Gary:
This guy also claims to be an E-waver and is much more bullish on the market than you (or me). Guess there are E-wavers and E-wavers.
BULLS GET TREAT FOR HALLOWEEN
In last week's commentary we stated:
"Thursday was a very positive session in that the market
was able to hold up in the face of bad news, which suggests
that the 10/18 may be the platform from which a multi-week
rally could be launched... We peg critical resistance at
1320 SPX. If bears cannot hold their ground at that level
then we are in all likelihood headed for new highs... bulls
have expanding daily volume on their side which supports
the notion that an impulsive uptrend is now underway... if
the overbought TRIN-5 fails to stop this rally, and the
1320 SPX level is exceeded on strong volume and breadth,
then the bears will be back in hibernation likely for the
remainder of this year."
After a mild pullback in the early part of the week, the
market gapped above our critical 1320 resistance area
Thursday morning on bullish economic data and never looked
back.
Breadth and volume measures were quite impressive
both Thursday and Friday, with 1 Billion plus shares traded
on the NYSE, and advancers beating out decliners by more
than 2 to 1 both sessions. The McClellan Oscillator vaulted
to its highest readings since 4/17/99 and new highs outpaced
new lows on Friday for the first time since 9/10/99.
So, as the stock market goblins of October are ushered out, it
looks as if bulls got the Halloween treat and bears got the
trick.
All the major indices broke out above their
downtrend lines from the 7/19/99 highs, with an especially
stellar showing from financial stocks which had previously
been the biggest drag on the market during this pullback.
In addition, both the US Dollar and the T-Bond reversed
their downtrends and rallied strongly this week, creating a
supportive environment for stocks. Our intermediate-term
indicators are all now on solid buy signals and our Elliott
wave count suggests that Dow 13,000 and SPX 1600 levels
could be seen before this uptrend is complete.
By all counts it appears that the bull is back, and that bears
have gone into hibernation for the winter. Since the market
discounts the future, it is our opinion that the process of
discounting a Y2K non-event is currently underway.
There is an old saying on Wall St., "In by Thanksgiving, Out by
Easter". We are now very close to entering that positive
seasonal period.
So, from this point forward we will look to buy the dips until we begin to again see signs of
technical erosion. At this time we expect the current rally
will last at least into January 2000, when a Y2K non-event
and strong 4th quarter results could become a "buy the
rumor, sell the news" situation.
Short-term we expect a minor high in the 11/3 +/- 3 trading day timeframe, we are
in the timeframe now, so some type of brief pullback could
be expected in the days ahead.
We would view any such pullback as a buying opportunity.
(c) 1999. Bill Shepler - You can write to Bill at wshepler@yahoo.com |
