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Posted by bkenison on October 10, 2008, 7:49 pm
Many years ago, I discovered a very powerful predictive relationship
between two of the indicators presented on the weekly charts
at:
http://www.pricecharts.com
You can get an inexpensive trial subscription at that site.
Observe the relationship between the 7-Bar ADX line and the Market
Sentiment line on any weekly chart. You will notice what I have
labeled the Widen/Buy and Narrow/Sell Effect.
When you see those two indicator lines significantly widen away from
each other, a major bottom buy point is imminent usually within three
to four weeks. When you see those two indicator lines significantly
narrow towards each other, a major top sell point is imminent usually
within three to four weeks.
Combining this information with a careful reading of extreme bullish
or bearish indications observed in the Commercials line of the Net
Traders Positions chart is another important confirming element. When
commercials are building extreme long positions, it is a sign that the
market is in strong hands and potentially bullish. The opposite is
true for extreme short positions.
When I see these signals occurring, I then apply Kenison Counting
Numbers to the monthly, weekly, daily and intra-day charts to
determine long-term put or call buying entry points. Then all you
need do is wait for the inevitable favorable price explosion. Kenison
Counting Numbers subsequently can then be used to determine the exit
point when the profitable new trend exhausts itself.
Copyright (c) 2008 Bruce Kenison. All Rights Reserved.
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Bruce Kenison is the founder of several market timing advisory
services employing the Kenison Counting Numbers precision market
timing method and is the editor of Bruce Kenison's Market Timing
Signals ezine and newsletter available FREE to investors and hedgers.
He is also president of a publishing and seminar production company
that recently published the 5th Edition of Bruce Kenison's Market
Timing Home Study Course. For a FREE subscription to the ezine or
newsletter and information on products and services, send a blank e-
mail with "Subscribe" in the subject line to:
brucekenison1@yahoo.com
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