Problem 5-08

Currently, Charlotte Art Importers is selling at $23 per share. Although you are somewhat dubious about technical analysis, you want to know how technicians who use point-and-figure charts would view this stock. You decide to note one-point movements and three-point reversals. You gather the following historical price information:

Date	Price		Date	Price		Date	Price
4/1	24		4/18	33		5/3	30
4/4	26		4/19	32		5/4	30
4/5	27		4/20	30		5/5	29
4/6	28		4/21	28		5/6	28
4/7	29		4/22	26		5/9	27
4/8	30		4/25	25		5/10	27
4/11	32		4/26	27		5/11	27
4/12	33		4/27	29		5/12	26
4/13	35		4/28	29		5/13	26

Choose the correct point-and-figure chart where Xs are used for uptrends and Os are used for downtrends.

The correct chart is -Select-chart Achart Bchart Cchart DItem 1 .

A.

40
39
38	X	O
37	X	O
36	X	O
35	X	O
34	X	O
33	X	O
32	X	O
31	X	O
30	X	O	X
29	X	O	X
28	X	O	X
27	X	O	X
26	X
25	X
24	X
23	X
22
21
20
19

B.

40
39
38
37	X	O
36	X	O
35	X	O
34	X	O
33	X	O
32	X	O
31	X	O
30	X	O
29	X	O
28	X	O
27	X	O
26	X	O	X
25	X	O	X
24	X	O	X
23	X	O	X
22		O	X
21
20
19

C.

40
39
38
37
36
35	X	O
34	X	O
33	X	O
32	X	O
31	X	O
30	X	O	X	O
29	X	O	X	O
28	X	O	X	O
27	X	O	X	O
26	X	O	X
25	X	O	X
24	X
23	X
22
21
20
19

D.

40
39
38
37
36
35
34			X	O
33			X	O
32			X	O
31			X	O
30	X	O	X	O
29	X	O	X	O
28	X	O	X	O
27	X	O	X
26	X	O	X
25	X	O	X
24	X	O	X
23	X	O	X
22		O	X
21		O	X
20		O	X
19