MARKET INDEX TECHNICAL ANALYSIS - MITA Message Board

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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA

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To: J.T. who wrote (5905)	1/5/2001 1:55:17 AM
From: J.T.	Read Replies (2) of 19219

Rydex Total Assets Update for Thursday, January 4th 2001: Regular Series: SPX Long - NOVA 448.9 Million SPX Short- URSA 220.0 Million NDX Long - OTC 1,936` BILLION NDX Short- Arktos 80.5 Million XAU Precious Metals 28.5 Million Banking 158.4 Millionnew all time high Biotechnology 519 Million Money Market 812 Millionnew 52 week low ******************************************* Dynamic Series (200% correlation) SPX Long - TITAN 129.3 Million SPX Short- TEMPEST 14.8 Million NDX Long - VELOCITY 179.2 Million NDX Short- VENTURE 15.4 Million ******************************************* Mr. Greenspan throwing that curve ball on Wednesday still has me in a spin. Same goes for that zone I was in... it will be good to get away for the weekend and re-establish coherent analysis without emotion. At the FOMC meeting in November after the election when A.G. kept the tightening bias on I said the Fed was now behind the curve and he made a major mistake not moving to neutral or loosening bias. Then in December he went from tightening to loosening. Now a quick intermeeting 50 basis points fed funds cut and 25 basis point discount cut followed by a second 25 basis point cut in the discount rate. And now fed funds futures is predicting a 50 basis point cut at the end of January FOMC meeting...Why so late a move and now why so rapid a cut followed by potential more cuts? The possibility of 100 basis point cut in less than 30 days in January alone whats he know we don't know? What kind of message is A.G. sending? Sounds like he is panicking bout something and not his normal self abandoning his past incremental approach. Seems like he has lost his edge. Rydex: 1) Money Market total assets bother the hell out of me. I can see total assets plummeting on good follow thru today but today was a smart pullback and it hurt. Maybe the ones who didn't jump in yesterday were hoping for the 1 day pullback to get in. If that is the case they got their wish. Furthering this thought process, if now the market jumps smartly higher tomorrow off of the employment report these cash assets will plummet down to 750 million and lower. Right now, the rydex read here is double overbought levels. BEARISH. Rydex Banking TA confirms the BKX back to back new high levels as BKX closed at another all time high at BKX 956.13. This is well off the intraday high of BKX 977.26. Because of this pullback off the highs, 5 day rsi levels are still below double overbought at 78.58. So it still has potential room to run. On a benign employment report tomorrow BKX will close in on BKX 980 - 990 level... XAU continues to flounder lower. It closed below XAU 50 for the first time in 11 trading days. XAU closed at XAU 49.79 down 75 cents. Good support at XAU 47 and with a 5 day rsi oversold reading of 26.85, XAU is approaching a nearterm bottom. That coupled with very low TA in rydex precious Metals Fund you have a very explosive situation ready to uncoil higher.. BULLISH If the market can rally on a market friendly employment report tomorrow, and XAU continues lower it is possible I may move funds back into XAU and lock in long gains if theey can offset today's losses.... I am very uncomfortable with low total assets in ALL the Bear Short Funds, coupled with extremely high readings in double your pain Long Funds and low cash levels in the money market fund. This, in conjunction with A.G's peculiar actions of late...It just doesn't add up... Somtin' smells rotten in dodge... A conundrum of sorts... I have remained 50% Long SPX NOVA and 50% Long OTC... Best Regards, J.T.

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