Having been surprised by missing the gaps on NQ , I'm equally surprised to see how the DOW is shaping up. Clear cut CCI trend line break, RS switch on RSI and major Inv. H&S on the price and bounce on the 50 RSI.
Please forgive me as I'm not that good at the 3 R's. However here goes.
The answer to your question is - the software does it for you !!!
Now that was'nt so hard was it ?
No seriously, we are all looking for market tops, bottoms,reversals and trends. So I use P & F as my home base as it were.
The chart above is a 100 pt. 3 box reversal.
each column is made up of O and X's and the value of these is 100pts. It takes 3 X's before any-thing shows on your chart from a down column of O's (that's the 3 box reversal part), then after that a X will show when there has been a 100pt. rise. The X's keep on going until there is a 300pt reversal, then 3 O's will show. Now you would use your best and favourite methods to decide if this was just a retracement or a full blown reversal. As you can see in the chart what most of us hope is the bottom I,ve drawn the red major support line, above that are the minor support line and the two resistance lines. After the big move up from 7300 ish we retraced 300pts (3 O's) the next column then showed a column of X's, this is the break-out. At this point I put my target on. Then I watch all you day traders (very nice people), to swing me in and out of the game.
If this does'nt make much sense, Chartman has kindly offered to help me out with the text.
You can tell I'm bored,I'm looking at the Pre dinosaur Dow charts
Anyway, interesting point here. Those that have followed my rantings for a long time will recognise one of my pets- the 3/4 trend line slope change. Whichever way you look at the chart, we have had the fourth down slope rate of change.I dismiss the downtrend resistance line that touches 9000 on 21/05 as it doesn't fit the " end of downtrend profile" that we see on the intraday charts that prove so reliable. This must bring smiles to the Bulls out there... Not that I'm going to rush out and go long on Monday- to the contrary. But I think I'll look to top up my pension soon ..... We have an Inverse H&S that has a target of 8800, which is where we are today. We have a nice Bull triangle on RSI too.
All in all, it seems to me that everything is stacking up the same way in all the time scales.To me , that adds up to 10,500, which just happens to be the last major high. Timescale? Mid March.....
On the other hand, it could all go belly up and we take a dive to 6000, but I don't see it.