MDA - Market Direction Analysis Message Board

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Strategies & Market Trends : MDA - Market Direction Analysis

SPY 680.44

+0.6%

Dec 19 4:00 PM EST

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To: set who wrote (51313)	5/19/2000 4:50:00 PM
From: pater tenebrarum	Read Replies (1) of 99985

Shahar, you are right , there's no failure yet...however, we're very close. the historical examples suggest that an actual failure would indicate still lower prices ahead. the best chart pattern and a/d divergence comparisons i have found that show similarities to the current Nasdaq patterns have unfortunately mostly had downside resolutions. the only reason why i'm a bit reluctant to predict an exactly similar outcome is the fact that the other indices have as of yet failed to show much weakness. but if i were to disregard that fact and look at the NAZ in isolation, i would probably tend to expect a Nikkei 1990 type decline, with another big leg down directly ahead. much will depend on what the next rally looks like. if it is strong and accompanied by a spirited a/d line rebound with a/d volume strongly positive, i would discard the Nikkei scenario. however, if all we get is a weak bounce off horizontal support with secondary and tertiary stocks remaining in their downtrend (i.e. no a/d confirmation of the bounce) i would look at the Nikkei for guidance regarding the likely size of the next leg down. regards, hb

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