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Determining Lows

Before the analyst can begin counting, he or she must determine from which lows the counts will be made. Like key dates in the 107-day Top-to-Top count, lows are determined by closing prices. “In deciding which day is the low, we go by closing prices with very few exceptions.” One exception Lindsay noted was for what he described as “extreme” intraday lows. Here again, he failed to define exactly what should be considered an “extreme” intraday low and depended on the reader’s judgment. At one point, he wrote that that it would “violate common sense” to call one particular day the low just because it was the closing low when an adjacent day contained an extreme intraday low.

“A count can be taken between any two lows, no matter how far apart they are, or what fluctuations take place between them. Thus, there are an enormous number of Low-Low-High counts. Since we are interested only in worthwhile downtrends, we use a small number of the total counts. They must therefore be sorted out systematically to avoid confusion.” The “system” Lindsay used to sort the lows was to differentiate between what he categorized as important lows and minor lows.


  

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