Stock Attack -- A Complete Analysis Message Board

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Strategies & Market Trends : Stock Attack -- A Complete Analysis

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To: Chris who started this subject	8/20/2000 6:07:26 PM
From: donald sew	Read Replies (1) of 42787

AUG 20 INDEX UPDATE --------------------- DOW - midrange SPX - overbought OEX - overbought NAZ - overbought NDX - overbought CBOE PUT:CALL RATIO - .45 5 DAY TRIN - 4.34 VIX - borderline CLASS 1 BUY SIGNAL(inverse to market) Last week produced some bullish signs: DOW setting a significant HIGH high and breaking above MAIN DOWNWARD TRENDLINE(DIAMOND TRENDLINE) NAZ breaking above 200 DMA on a intraday basis not closing NDX breaking above 200 DMA SPX setting minor HIGHER HIGH OEX setting minor HIGHER HIGH NYSE market internals improved Yes last week was bullish but I AIN'T convinced yet, for the following reasons: 1) low volume 2) VIX continuing to set LOWER LOWs implying complacency, some could argue thats a bullish sign since the VIX could go lower 3) Inverted yield curve. Either the short-term rates will drop to or the longer-term rates(10 year rates) will rise, or some combination of the 2; however any rise in rates could stall this rally. 4) Mid-term overbought readings in the DOW, SPX, OEX As mentioned a few weeks ago that there was significant resistance for the NDX around the 3800 range and the 62% FIB rebound level at 3805. Although the NDX did get to 3860 intraday, it closed at 3807 giving up all of the intraday gains and a bit more and formed an INVERTED HAMMER and a BEARISH HARAMI(just moderate candlestic reversal signals). Although the resistance line at 3800-3805 was broken intraday, the pullback to the resistance line was a hint that this break may just have been an overshoot. As mentioned previously, I am not expecting any rally after the FOMC meeting to be too strong or last long with my cycle analysis calling for a mid-term top during the 1st week of SEPT, and that selling should intensify. Also, I will not turn bullish on the NAZ until it sets a HIGHER HIGH above 4289. Keep in mind that if the NAZ can not get over 4200 area, then the NAZ could be forming a HEAD & SHOULDER pattern. With earnings announcement over and the negative seasonality of SEPT, that could be a good environment to develop and break the right shoulder of the H&S if the NAZ cannot break above 4200 area.

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