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Oct 16, 2006 - Issue #028

Record High!

DJ-30: 11960.51 +110.30 +0.93%.

In the Real World: 49.81 +0.46 +0.93%.

UP: 19 (-3), Down: 11 (+3).

Trends (weekly): This is the subjective part.

Rising 21 (n/c):

AIG, AXP, C, DD, DIS, GE, HON, HPQ, IBM, INTC, JNJ, JPM, MCD, MO, MRK, MSFT, +*PFE, PG, T, UTX, VZ.

Consolidating 5 (n/c):

CAT, GM, -*KO, WMT, XOM.

Declining 4 (n/c):

AA, BA, HD, MMM.

* denotes change of category.

+/- denotes change of direction.

Notice anything new in the above score card?

From now on, we're going to see the "real world" DJ-30 for what it is, side by side with the phoney imposter. Simply add the components and divide by 30. Simple!

What does this accomplish? Well, for one thing, it knocks off the BS! It makes the average "real". It gives us a figure with which we can identify. It allows one to see things in proper perspective.

If it makes you question how they can throw 30 prices into that 'witchs' brew and come out with 12,000, it will be doing its' job!

If it keeps you sober when everyone else is drunk, it will be doing its' job!

If it keeps you from being deceived when everyone else is being manipulated, it will be doing its' job!

For the record, when the Dow made new all-time closing highs thursday and friday, only two stocks also made new highs (AXP and UTX). Many components, although in rising trends, were hardly in new high territory yet the formula cranked out new highs??? Give me a break!

However, we shouldn't complain. Afterall, knowing how Wall Street wants us to think actually gives us an advantage.

Never forget what trading is all about. There are two sides to every trade; buyer and seller. Each doing the opposite. They both can't be right.

Smart money tends to be big money and big money must go about the business of accumulating and distributing stock positions swiftly and secretly ahead of everyone else.

While smart money acts on information not yet available to others, tape readers endeavor to intertrept the smart money trading activity and follow them.

Stocks that appear to be under accumulation: DELL, CHS, WON.

Stocks that appear to be in distribution: CAL.