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Strategies & Market Trends : MDA - Market Direction Analysis

SPY 683.38

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Nov 12 4:00 PM EST

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To: el paradisio who wrote (61348)	10/24/2000 2:55:31 PM
From: Les H	Read Replies (1) of 99985

WHAT TO EXPECT NOW. October 23, 2000. ORD ORACLE. In candlestick charting on the December S&P's a "Advance Block" was drawn. This is a three-day pattern that warns the rally is running into trouble. The "5 day ARMS" closed today at 4.51, which is just neutral. The "Percent Volume" indicator closed at .482, which is also neutral. No high uptick reading today of any consequence. The market rallied up on Friday on the Lighter volume than Thursday. This condition shows a lack of convictions to the upside and it a short-term bearish sign. There may be a pull back to test the October 18, 2000 low again and possibly break it. There is an outside chance the SPX may head all the way down to the October 18, 1999 support near the 1240 area. Right now, we don't have a signal for a top, but it may show up near term. We are staying flat the S&P's. The Nasdaq Composite broke below the May 24 low on October 18 on increased volume and than closed above it. This condition implies that the Nasdaq will go down and test that low again, near term. Friday the volume decreased from Thursday as the market rallied. This condition also warns the market is running into resistance and is one of the reasons we sold our long position on Friday in the Nasdaq Composite (for around a 5% gain). We think when the Nasdaq Composite does pull back to the October 18 low near the 3000 level; a buying opportunity will present itself. We are flat the Nasdaq Composite for the moment. The Gold market made a low in October 1999, according to the "Wyckoff method" of technical analysis. A pull back occurs that retraces about 50% of the October 1999 rally and would put the Gold market near a low at current level. This low may take more weeks to complete. We are holding our long position in the XAU. marketweb.com

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