Daily Chart Oscillators Offer a Bullish Look for January 2010

The chart above shows the basic volume oscillator using Terry Laundry's formula to calculate the function.  I have drawn the latest three (3) T's using this oscillator to determine the cash build up phase which is the time duration of the left half of the T.  The right side of the T is the time period where we expect a high probability superior market price appreciation.  As the price chart illustrates, once the middle post of the T has been discovered then the right side of the T is a rising market.  It is said that Genius is a bull market.  I say that true genius is to recognize the bull market.  T Theory cannot forecast the time when the next center post will be places, however, the right side of the center post T is hauntingly accurate at predicting the end of a bull move. My New T Theory has developed some new oscillators that help to quickly recognize a new center post placement or in plainer English, to find the bottom of the downtrend.

Upon close examination of the top chart you will notice that the cacophony of the vicissitudes characterizing the basic volume oscillator function can easily confuse anyone.  As a result, I have developed a series of derivative functions that that more clearly define the new center post placement and can clearly illustrates the cash build up phase.  The above chart illustrates three (3) functions with smoother curves that provide clear visual evidence of the new center post of each T and where the left side of the center post begins.  These new functions are a valuable tool in drawing our T's for T Theory.

The above chart shows further derivative functions that produce oscillators that form a bottom in concert and sometimes form a top simultaneously.  The horizontal lines are drawn at the level of one (1) standard deviation  of the functions. I have drawn double T's to illustrate the different tops each oscillator shows for the cash build up phase.  Both of the latest T's indicate further duration of the bullish persistence of  the Dow Jones Average.  The bullish daily T's combined with the bullish 10 minute T's confirm my bullish positions of Long DIA and BGU and short BGZ put on 1/6/2010.  The DIA is up 1% and BGU and BGZ are up 3% at todays close.

A further refinement of the New T Theory are my directional oscillators.  The oscillators in the above chart will cross each other when confirming a  uptrend.   The red and green oscillators will cross at the center post and at the end of a defined T.  These red and green oscillators are a good indicator for finding the position of a new center post and also confirms the end of a defined T.   Currently these oscillators are in bullish territory.  The outlook for January is very bullish at the present time. The only thing to worry about is a bursting of the bubble in China.  They have built a large inventory of unsold goods for export that the Chinese government is financing.  What will happen when they realize that all this inventory cannot be financed forever.  Someone in the Oxidant has to buy those goods and it is not happening. For now in the American Stock Market it is onward and upward.