1946 DJIA AND NYSE A/D LINE AND ITS TREND CHANGE BUYS AND SELLS
The
peace rally stalled out after the DJI advanced past 200.
A bearish
head and shoulders’ pattern unfolded with a flat, well-tested neckline.
Note how the Accumulation Index turned negative on
the
extended
right shoulder. This was bearish. Selling and selling short at the
peak expected when assuming the pattern would develop symmetrically,
so that the right shoulder’s peak would approximate the left shoulder’s
peak would have been profitable. A perfect
“sell S14” appears at the
July peak. The DJI ha moved 1% above the
21-day ma with the
P-Indicator very negative. Note the miniature
head and shoulders
in the week before and after the July peak, just before the breakdown
in August.
The bear market of 1946 ended with an October low, just as
many bear markets do. There were four tests of
176-179. Tiger’s
Accumulation Index turned positive in October and November
on these declines to the lower band.
A
US Securities and Exchange Commission study investigated whether
the August market dive was a “bear raid” instituted by professional short
sellers.
It later of the 1946 market crash concluded that between 17% and 28%
of the shares sold were sell orders triggered by
mechanically applied formulae, especially the by the obvious head
and shoulders pattern. So, even before the
invention of options and
futures trading, nervousness arising out of a changing trend brought
about heightened volatility.
Usually, if the economy has
been in a recession and the stock market
experiences a pronounced bear market and then a
reversal
by 15%, it then
rises by at least 15% or more. The 1946
decline took place without
the market only rising 24% from the bottom, instead of
at least 30%.
(http://72.14.253.104/search?q=cache:yA4Qfr-DxgEJ:www.albany.edu/~renshaw/stk/stk09S.html+1946+market+crash&hl=en&ct=clnk&cd=12&gl=us&client=firefox-a
Edward Renshaw - Professor of Economics - tate University of New York at Albany - Major
Fluctuations in the Stock Market
Events: 1946
1946 PEERLESS DJI, REGULAR BUYS, SELLS AND INTERNAL STRENGTH INDICATORS
1946 PEERLESS DJI, EXTREME BEARISH BUYS, SELLS AND INTERNAL STRENGTH INDICATORS
Yalta Conference (Roosevelt,
Churchill, Stalin) plans final defeat of Germany
The UN Security Council holds its first session
March 2
A communist-dominated government under Petru Groza
assumes power in Romania.
March 5 - In his speech
at Westminster College, in Fulton,
Missouri, Winston Churchill talks about the Iron Curtain.
March 15 - Clement Attlee
promises independence to India
as soon as they can agree on constitution
May 20 - In Britain, the House of Commons decides to nationalize mines.
May 26 - Czechoslovak
parliamentary election, with Communist victory
(38%), last before communist take power
June 8 - In Indonesia, Sukarno incites his
supporters to fight Dutch colonial occupation
· July 22 - King David Hotel bombing: Irgun bombs King David
Hotel in Jerusalem,
headquarters of the British civil and military administration killing 90.
July 25 - Nuclear
testing: In the first underwater test of the atomic bomb, the
surplus USS Saratoga is sunk near Bikini Atoll in
the Pacific
Ocean when the United States detonates the "Baker Day" device.
August 19 -
Violence between Muslims and Hindus in Calcutta leaves 3000 dead.
· October 2 - Communists take over in Bulgaria
November 8 -
Vietnamese riot in Haiphong
and clash with French troops. French cruiser Suffren opens fire. 6000 Vietnamese
killed.
November 15 - Netherlands
recognized Republic of Indonesia.
December 12 - Léon
Blum founds a government of socialist parties in France
-
The new communist government held power in Tabriz center of Iranian Azerbaijan Provience.
· December 19 - Martial law in Vietnam
Chinese
Civil War intensifies between Kuomintang and Communist Party of China.
---Passim - The British government takes emergency powers to deal with the
balance-of-payments crisis. Bank of England nationalized.