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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA
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To: J.T. who wrote (92)6/14/1999 3:15:00 PM
From: J.T.  Read Replies (1) of 19219
 
MARKET COMMENTARY, June 14, 1999 Mid-afternoon update

Some observations:

1) DOW strength is masking underlying broad market weakness. Oils, chemicals, and cyclicals are keeping the index strong. Definitely late in trend stuff. Obvious observation of weakness is in interNUTS like DOT, IIX, and GIN Index. AOL, EBAY, EGRP, CMGI et al is breaking the spirit of orbital bulls. They now need to rethink strategies going forward as the rules of the game have forcefully changed. SPX is listless in this rally but nevertheless is still up.

2)I have mentioned CONTINUED TROUBLE WITH BKX and its life-support it needs to stay above:
Mita Post #92

<BKX gapped down this morning on the open from yesterday's close. We are now at 824 and near the lows of the day. First close below 822.67 and we are on High Alert Status. Second close below this level drives another nail in nirvana bull argument to new highs now and commencement of intensified correction.>

We got down to intraday low of 820.92 and have bounced off this 822 low support again. We are now back up to 826 and this would be a technical plus for the bulls if it finished near the highs of the day at 828 area.

3) RUT is breaking down and needs to hold 832.50 support. We are near lows of day at 833.20. TWO CLOSES BELOW 832.50 AND THIS WILL DEAL ANOTHER RIGHT HOOK TO BULLS.

4) SPX is tired and dragging its @ss along DOW coat-tails. I am tightening this index up: TWO CLOSES BELOW 1,293 AND BOYS WILL RUN THROUGH 1,281 LOWER SUPPORT AND ATTEMPT TO BRING IT BACK UP above this important support. TWO CLOSES BELOW 1,281 AND BEAR CORRECTION ACCELERATES LIKE FIRE CATCHING WIND.

5) VIX IS GAINING MOMENTUM OF STRENGTH. Again my post-MITA 92 mentions critical resistance levels that we are fast approaching:

< VIX INDEX is popping up much higher this morning. This index is an early indicator of market trend changes. We have established two day support at 23.45 and 23.47 June 4 and June 7. Two day close below this level and market reverses back up. Resistance is at 28.70. TWO CLOSES ABOVE 29.66 AND THIS CORRECTION ACCELERATES DRAMATICALLY. We are at 26 interday right now.>

VIX is now pulling back to 26.75 from intraday high of 28.07

6) DOMINOE EFFECT OF ONE INDEX AFTER ANOTHER IS BREAKING SUPPORTS. THIS BECOMES CANCEROUS AND EVENTUALLY CATCHES ON TO THE STRONGEST INDICES LIKE SOX AND DOW.

7) RALLIES ARE BEING SOLD INTO STRENGTH.

8) I WILL INTRODUCE SEVERAL NEW INDICES AFTER THE CLOSE WHICH WILL ENHANCE OUR LASER-BEAM IMAGE OF ADDITIONAL EARLY WARNING INDICATORS OR POTENTIAL CRACKS IN BULL ARGUMENT.

Best, J.T.
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