Mike Scott Webinar Today

[Pascal]

Mike,


In your slide 21, you state the bar count rules.
Where do you start that bar count?

Can you provide a few typical rules of where to start?
For example," since the high before the previous pull-back started" or "max past 20 days."

The bar count summation will be different depending on the starting point.

Also, are recent patterns more important than past patterns? For example, if you count 20 days, are the last 5 days more important than the previous 15 days?


Pascal

[Mike]

Mike,


In your slide 21, you state the bar count rules.
Where do you start that bar count?

Can you provide a few typical rules of where to start?
For example," since the high before the previous pull-back started" or "max past 20 days."

The bar count summation will be different depending on the starting point.

Also, are recent patterns more important than past patterns? For example, if you count 20 days, are the last 5 days more important than the previous 15 days?


Pascal

Pascal, The bar count starts at the beginning of a base formation. The beginning of a base is the first down week after a closing high and counts up to but not including the breakout week which is possibly the breakout above a handle formation or a move to a new high in case of no handle. Minimum length of a base is usually 7 weeks however flat bases can be 5. Cup formations can be as much as 65 weeks.

The whole process is to help gauge whether institutions are accumulating or distributing. How the price closes at the end of the week helps tell what they are doing. As such more recent bars on the right side of the base are more important than the left. The method I described makes no such discrimination however it is a subtly that I might bring into a close call.

[barbados11]

Pascal, The bar count starts at the beginning of a base formation. The beginning of a base is the first down week after a closing high and counts up to but not including the breakout week which is possibly the breakout above a handle formation or a move to a new high in case of no handle. Minimum length of a base is usually 7 weeks however flat bases can be 5. Cup formations can be as much as 65 weeks.

The whole process is to help gauge whether institutions are accumulating or distributing. How the price closes at the end of the week helps tell what they are doing. As such more recent bars on the right side of the base are more important than the left. The method I described makes no such discrimination however it is a subtly that I might bring into a close call.

Hi Mike, I also enjoyed your presentation and I thank you for it. One clarification I'd like to get is on counting the tall bars. Does it mean any bar over average volume (ie, 1% or more above avg.) or do you want to see some height over the average volume say 10% or more?

Best,

Pablo

[Mike]

Hi Mike, I also enjoyed your presentation and I thank you for it. One clarification I'd like to get is on counting the tall bars. Does it mean any bar over average volume (ie, 1% or more above avg.) or do you want to see some height over the average volume say 10% or more?

Best,

Pablo

Pablo, the tall bars mean the bars that touch or are above the 10-week moving average volume line.

[barbados11]

Pablo, the tall bars mean the bars that touch or are above the 10-week moving average volume line.

Mike,

Good to know since sometimes there are several bars that are just under the 10 week average so bars that touch the average don't look tall.

Thanks,

Pablo

[barbados11]

Mike, do you have any rule about entering a position if the uptrend resumes without a FTD? Today we could since the S&P highs are a whisker away.

[Mike]

Mike, do you have any rule about entering a position if the uptrend resumes without a FTD? Today we could since the S&P highs are a whisker away.

IBD will sometimes turn the buy switch on without a FTD if the S&P or NASDAQ close at a new high (above 1897.28 on the S&P500). The NYSE volume by the way is running just 2% lower than Friday. If I were talking about the NASDAQ making a new high with many stocks setting up in proper bases it would be a near certainty that the buy switch would go back on. Many leading stocks have been damaged and need time to repair, so time to be cautious.

If we had a target rich environment with quality stocks breaking out and working I would consider entering some positions in advance of a FTD. I just don't see it that way right now.