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Jul 10, 2006 - Issue #014
What's that ticking sound?
The weekly charts are most revealing. Many of them have adjusted their significant
support trend lines upward in a manner similar to raising a trailing stop-loss order.
Many others are on the verge of doing so.
When these upward support trend lines are first installed after a long decline in a
stocks' price, they represent strength and signal a change of direction in trend.
However, after a sustained upward trend, sooner or later, the final upward revision
often appears shortly before a major break to the down side.
So, what do these latest installed trend lines represent? New found strength or are they
pointing out the line of demarcation? I don't think we'll have to wait long to find out.
Intel (INTC) is still looking strong as long as its' support, which it currently seems
to be testing, holds.
Radioshack (RSH) has finally shown signs of life. It seems the companys' 'head-hunters"
have brought in a new "hired gun" to turn things around.
The big upsurge in price was probably due, in addition to fresh money coming in from
brokerage firm "buy" recommendations, to short covering, which is always the first sign
of strength. If the "shorts" cut and run, pay attention. They're telling you where to
put your money. Isn't it nice to have professionals point the way?
Comments? Ideas? Feedback? Let me have it, right between the eyes! I'd love to hear from you. Just reply to this zine and tell me what you think!