How reliable is buying when a rising 200 day ma
               appears to be successfully tested.

       
  Here we assume the 40 wk ma is practically the same as the 200-day ma.
                The 200-day ma is considered broken when it either subsequently declines
                more than 10% or when it then needs to consolidate for 7 months or more.

                In a bull market, there was always at least one successful test of the 200-day
                ma.   But it eventually fails.  A failure is much more likely, but not guaranteed,
                when the DJI last new high was not confirmed by the weekly A/D Line.

                Of the 9 bull markets where there were at least 3 tests of the 65 dma,
                in 7 cases the break occurred only when the A/D Line had failed to confirm the
                last DJI high.  Only twice did the 200-day ma not hold up when the A/D Line
                had confirmed the DJI's strength.


       
Conclusion: We should probably consider the 200-
         day ma a point to Buy as long as the Weekly A/D Line
         confirmed the last DJI high.  The first exception, in
         mid 1946, took place after an unmistakeable
         head/shoulders had formed.  The other case was in
         January and February 1977.  In this case, weekly
         A/D Line only marginally confirmed the DJI high.
         In the 2014 case, the weekly A/D Line did confirm
         the DJI high.


         
1935-1937    1 successful test  and then a failure.  NYSE A/D Line failed to confirm the last higH.         
          
>>   1941-1946    3 successful tests and failure.   NYSE A/D Line confirmed all the way up.
           >     1949-1950    3 successful tests and
failure.  NYSE A/D Line failed to confirm the last high.
           >     1954-1956    3 successful tests and
failure.  NYSE A/D Line failed to confirm the last high.
                 1958-1960     1 successful test  and
then a failure.   NYSE A/D Line failed to confirm the last high.
                 1963-1966     2 successful tests  and
then a failure.   NYSE A/D Line failed to confirm the last high.
                 1967     1 successful test  and
then a failure.   NYSE A/D Line failed to confirm the last high.
                 1968-1969    2 successful tests  and
then a failure.   NYSE A/D Line failed to confirm the last high.
                 1970-1971    1 successful test  and
then a failure.   NYSE A/D Line failed to confirm the last high.
                 1972-1973    2 successful tests  and
then a failure.   NYSE A/D Line failed to confirm the last high.
          
>>   1975-1976    3 successful tests and failure.   NYSE A/D Line confirmed all the way up.
                 1983-1984     1 successful test  and
then a failure.   NYSE A/D Line failed to confirm the last high.
          >
     1985-1986    3 successful tests and 6 month consolidation. NYSE A/D Line failed to confirm the last high.
          >      1986-1987   1 successful tests and
failure.  NYSE A/D Line failed to confirm the last high.
          >      1988-1990    5 successful tests and
failure.  NYSE A/D Line failed to confirm the last high.
                 1991-1994     2 successful tests (in that the decline did exceed 10%) and then
7 month hesitation. 
         
>      1995-1998     3 successful tests and failure.  NYSE A/D Line failed to confirm the last high.
                 1999-2000     1 successful test  and
then a failure.   NYSE A/D Line failed to confirm the last high.
          >      2004-2007   7 successful tests and
failure.  NYSE A/D Line failed to confirm the last high.
          2009-2010   1 successful test and failure.   NYSE A/D Line confirmed all the way up.
                 2010-2011    1 successful test and
failure.  NYSE A/D Line confirmed all the way up.
                 2012-2014    4 successful test and
???????.  NYSE A/D Line confirmed all the way up.

                Weekly TIGER DJI charts - http://tigersoftware.com/TigerBlogs/May15,2011/index.html

WK2934.BMP (1108854 bytes)
WKDJ3337.BMP (1440054 bytes)
 

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