Sunday, June 07, 2015 10:07:07 PM
*** Richard D. Wyckoff's REAL Rules of the Game
SHOWS IWM D
The Russell 2000 iShares (IWM) has a different look from the $INDU. The BCLX and the AR arrived in late March. Note how well they contain the subsequent price action. A decline off the Secondary Test (ST) comes on expanding volume and is a sign of active selling and results in a Sign of Weakness (SOW). The May rally does not take the IWM to a new high and we label it a ST. Later the label may change to a Last Point of Supply (LPSY). The primary distinction between the two is that a ST decline to the prior lows of the Distribution Range and the LPSY is the last rally point prior to a larger downtrend. The volatility of the last four bars is somewhat high, and there is no further upward progress. We would conclude this to be churning near the highs. The bulls need a follow through of prices to new highs soon. Otherwise testing the bottom of the trading range or declining further is a real possibility.
http://stockcharts.com/articles/wyckoff/
SHOWS IWM D
The Russell 2000 iShares (IWM) has a different look from the $INDU. The BCLX and the AR arrived in late March. Note how well they contain the subsequent price action. A decline off the Secondary Test (ST) comes on expanding volume and is a sign of active selling and results in a Sign of Weakness (SOW). The May rally does not take the IWM to a new high and we label it a ST. Later the label may change to a Last Point of Supply (LPSY). The primary distinction between the two is that a ST decline to the prior lows of the Distribution Range and the LPSY is the last rally point prior to a larger downtrend. The volatility of the last four bars is somewhat high, and there is no further upward progress. We would conclude this to be churning near the highs. The bulls need a follow through of prices to new highs soon. Otherwise testing the bottom of the trading range or declining further is a real possibility.
http://stockcharts.com/articles/wyckoff/
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