• 1 day China Launches Digital Yuan As U.S. Dallies
  • 5 days Squid Game Rampage Fails to Lift Netflix Stock After Stellar Earnings
  • 5 days Why Tesla, EV Stocks, Could Remain Highly Volatile For Years
  • 7 days Did Big Bank Earnings Just Signal ‘Real’ Economic Recovery?
  • 8 days The Cannabis Industry Is Looking To Fill The Employment Gap
  • 8 days Apple Capitalizes On Upward Momentum Ahead Of Earnings
  • 11 days Earnings Beat Isn’t Enough for S&P 500 Q3
  • 13 days The New World Tax Order
  • 14 days Is Crypto Finally Ready To Pay The Piper?
  • 15 days Is It Time To Buy The Global Gaming Market Dip?
  • 18 days Even The Mafia Has A Millennial Problem
  • 20 days Zuckerberg Loses Billions in Social Media Outage
  • 21 days ‘Pandora Papers’ Leak Reveals More Financial Crime
  • 22 days US Retail Has A Major Supply Chain Problem
  • 25 days China Has Set Out To Crush Crypto...Again
  • 26 days Top Performing Cannabis Stocks of the Year
  • 27 days Millennials Could Power A 20-Year Bull Stock Market
  • 32 days The Million-Dollar Question: Will China Bail Out Evergrande?
  • 34 days 3 Restaurant Stocks In Full Recovery Mode
  • 34 days Bitcoin Is Driven By Testosterone
  1. Home
  2. Markets
  3. Other

Lindsay's Second Test of the Low in a Horizontal Base

With the late rally and the close above the 1867 and 1872 lows, this pattern is in play. This scenario targets an 8/25/16 (+/-1) high (which happens to be an AstroWindow and the 29th Ganniversary of the 1987 high) before the next serious decline. Quoted below is what Lindsay said by way of respected Ed Carlson. Look at the SPX chart (I substitute the SPX in these times for the DJI) and see what you think, using a base starting with 8/24. The "separating decline" is that plunge into 8/24. The preceding "three peaks" are often a bit nebulous and can be more than three and can be a matter of Lindsian artistic interpretation. Also note the weekly MACD and RSI:

"The first step in identifying the formation is labeling the three peaks and the ensuing deep decline Lindsay called the 'separating decline.' During the separating decline the market must reach a level which is lower than at least one of the reactions following peaks one or two.The sell-off is followed by a period of base-building called, appropriately, the 'base.'

We're looking for an interval (roughly seven months and ten days) from either the bottom of the base or the separating decline to the top of the bull market. Typically, a base is horizontal and we count from the second test of the low in the base." - EC

S&P500 Daily Chart

 

Back to homepage

Leave a comment

Leave a comment