31 replies to this topic

[steve]

We had a weekly key reversal this week and we had one three weeks ago, and if the S&P 500 closes at this level on Jan 31, we will have eight consecutiove monthly up closes on the S&P 500 index.

[dcengr]

Looks like a key reversal occured on the week of 1/17/06? It was also a yearly high, multi month high, high RSI, etc. The price close for the week was much lower than the low tail of the previous week. The following week appears to be up. Would that week be defined as a key reversal?

[eminimee]

Using my favorite chart.....if the rsi breaks what seems to be a neckline........the most to expect is a wave 2 bounce......

Jury still out on that obviously and my hourly patterns still keep chances alive for at least a test of the highs.

http://stockcharts.com/c-sc/sc?s=$SPX&p=W&st=1999-01-01&i=p14175576400&a=57601821&r=659.png

[The End]

We had a weekly key reversal this week and we had one three weeks ago, and if the S&P 500 closes at this level on Jan 31, we will have eight consecutiove monthly up closes on the S&P 500 index.

We did not have a key reversal three weeks ago. It was not making a high for the move. The definition of a key reversal is quite clear.
Also, note that when you see one it does not mean that you can't meandor about for a little while. It should be considered a warning if it's of the Topping variaty.

Looks like a key reversal occured on the week of 1/17/06?

It was also a yearly high, multi month high, high RSI, etc.

The price close for the week was much lower than the low tail of the previous week. The following week appears to be up.

Would that week be defined as a key reversal?

I don't see a key reversal in the month of Jan 2006 when looking at a weekly chart.

Edited by The End, 26 January 2007 - 07:25 PM.

[dcengr]

We had a weekly key reversal this week and we had one three weeks ago, and if the S&P 500 closes at this level on Jan 31, we will have eight consecutiove monthly up closes on the S&P 500 index.

We did not have a key reversal three weeks ago. It was not making a high for the move. The difinition of a key reversal is quite clear.

Ok looks like I need more definitions or not understanding properly then..

Let me write this stuff down the way I think it is now..

1. Prior week must be making all time highs on yearly or monthly basis, RSI should be high, etc.
2. The following week must make higher high than the prior week, and close lower than the lowest low of the previous week (ie close must be lower tha the tail of the prior week).

Would that be correct? If so, then my previous assumptions of key reversal on 1/17/06 would be false since the highest high made on the reversal week did not exceed the high of the previous week..

[The End]

We had a weekly key reversal this week and we had one three weeks ago, and if the S&P 500 closes at this level on Jan 31, we will have eight consecutiove monthly up closes on the S&P 500 index.

We did not have a key reversal three weeks ago. It was not making a high for the move. The difinition of a key reversal is quite clear.

Ok looks like I need more definitions or not understanding properly then..

Let me write this stuff down the way I think it is now..

1. Prior week must be making all time highs on yearly or monthly basis, RSI should be high, etc.
2. The following week must make higher high than the prior week, and close lower than the lowest low of the previous week (ie close must be lower tha the tail of the prior week).

Would that be correct? If so, then my previous assumptions of key reversal on 1/17/06 would be false since the highest high made on the reversal week did not exceed the high of the previous week..

RSI has nothing to do with it. But a high RSI would most likely be present if you are making a high for the move. It does not have to be a multi year high but in th current case it is. You understand the rest of the definition.

[NAV]

Key Reversal Day - In an uptrend, prices open in new highs and then close below the previous day's closing price. In a downtrend, prices open lower and then close higher. The wider the price range on the key reversal day and the heavier the volume, the greater the odds that a reversal is taking place.


http://www.stockchar.../GlossaryK.html

Edited by NAV, 26 January 2007 - 07:36 PM.

[dcengr]

Key Reversal Day - In an uptrend, prices open in new highs and then close below the previous day's closing price. In a downtrend, prices open lower and then close higher. The wider the price range on the key reversal day and the heavier the volume, the greater the odds that a reversal is taking place.


http://www.stockchar.../GlossaryK.html

Ok just a subtle question here.. but it says "prices open in new highs". Does that mean it has to gap up above the close of the previous bar? Or is it sufficient to open at the same price as the closing price of the previous bar?

The example given in the initial post would suggest that opening at the same value as the close of the previous bar is sufficient.

[NAV]

Does that mean it has to gap up above the close of the previous bar?

That's correct.

[securelstmile]

The end, thank you for taking the time to explain this.