Why do you ignore the presence of the 50 day simple day moving average? [In] 1996 . . . throughout that year the 50 SMA served as support . . . in several instances, from January through September. (July 29, 2000)
We don't ignore it, it is just that the exponential 50 day moving average was being used by the Nasdaq during its past consolidation. We have both on one of our chart settings, and in watching the pattern develop, it was clear that the exponential 50 day moving average was acting as consistent support. When we notice a trend, we don't doggedly follow the old 'rules.' The market is dynamic, and we need to adapt to it while keeping our overall principals in sight.
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