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Stock Market Lindsay's Preliminary Low Sequence

Stock-Markets / Stock Markets 2015 Feb 25, 2015 - 09:51 AM GMT

By: Ed_Carlson

Stock-Markets

On August 23, 1972, the late technician George Lindsay made a presentation to the Society for the Investigation of Recurring Events (S.I.R.E.) in New York City. In that presentation he explained his preliminary low sequence.

Rather than the terms bull and bear markets (which can be of almost any duration) Lindsay created a concept called basic advances and basic declines. These basic movements are timed using his standard time spans which he found that, since 1798, all bull and bear markets fit into. When a basic decline terminates prior to the final low of a bear market that higher low was called a preliminary low (point 1).


Lindsay' principle of continuity directs us to count the next basic advance from that low rather than the ultimate low. Lindsay found anytime a basic advance is counted from a preliminary low the market action resembles Figure 1 below. The most important and interesting idiosyncrasy of this period is that the period just before and after point 5 has always been marked by slow and halting movement (see George Lindsay and the Art of Technical Analysis, FT Press, 2011).

Preliminary Basic Low

With the basic decline from the 2007 bull market top having ended in November 2008 the next basic advance is counted from that preliminary low and the time since then resembles Lindsay's template above. The pattern warns of a bull market top in the near future (to be continued next week).

Try a "sneak-peek" at Lindsay research (and more) at Seattle Technical Advisors.

Ed Carlson, author of George Lindsay and the Art of Technical Analysis, and his new book, George Lindsay's An Aid to Timing is an independent trader, consultant, and Chartered Market Technician (CMT) based in Seattle. Carlson manages the website Seattle Technical Advisors.com, where he publishes daily and weekly commentary. He spent twenty years as a stockbroker and holds an M.B.A. from Wichita State University.

© 2015 Copyright Ed Carlson - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


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