for you bob g.
Subject: Tech Stock Options
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To: lisa (35768 )
From: donald sew Sunday, Mar 1 1998 7:51PM EST
Reply # of 35784
INDEX UPDATE
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I just read Murphy's technical analysis and he brought up an issue which has not been discussed for some time, and that is interest rates. From Murphy's comment, it appears that as long as the interest rates stay below 6% the market has clear sailing and the market will basicly continue to decouple from interest rates. Once it crosses 6% the fears of rising interests rates may increase, and of course the higher we go the more it will effect and re-couple with the stock market. I am no expert in interest rates, and do not know at which level the stock market will start to fear rising interest rates.
From a technical standpoint only, no fundamentals, it appears that interest rates should cross over the 6% range within 15 days, solidly. The lows are getting higher and the highs are getting higher. The low was on 1/2 at 5.695% and just this past Friday, it got to 6.011 on a intraday basis but backed off and closed at 5.918.
The question is - is 6% high enough of a psychological barrier to just start some nervousness, since on just a technical basis we will get there very soon. I have heard that the 6.5-6.7% range would put a solid halt to further strong upswings. As I am far from an expert in the area of bonds, would like to hear comments on this.
Seeya
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