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The price action and specifically the breakout on 4/1 after the mother of all bases for the past 2 years was broadcasting loud and clear that something positive was coming on the fundamental front. Breakouts out of long bases are probably one of the most reliable patterns that something material has changed in the business fundamentals. Unfortunately, I missed this move as I have yet to figure out how to develop a system to catch breakouts on the exact day they occur or within a few days short of simply looking at hundreds of charts each day which unfortunately I presently do not have time for.

It looks obvious after it happens, but I bet if I took 50 cases of breakouts out of long bases, however you want to define that, and 50 cases that looked the same, but didn't break out, most people wouldn't score better than randomly on identifying which is which, if you just removed the actual breakout.

This would be perfectly easy to test, in the same way that it is possible to test the reading of mammogram films, for instance. You know how they all turn out! So a TA expert should be able to consistently distinguish between the ones that will break out and the ones that won't. If he can only do it after the fact, it's not worth much.

Regards, DTM
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