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Gold/Mining/Energy : Strictly: Drilling and oil-field services
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To: Big Dog who wrote (25997)7/20/1998 12:27:00 AM
From: waverider  Read Replies (1) of 95453
 
Your Dogness, I'm not an expert on this A/D line thing either but this is what it says to me:

Under normal, healthy conditions, when the market goes up there should be a supporting number of advancing issues as opposed to declining issues. We had that for the past 5 or 6 years if my reading is right. When the market went down, so did the advance/decline line...as one would expect. BUT now what we have is that the number of advances is NOT keeping up with decliners and that the index rise is VERY narrow. To have a healthy market, it must be broadly based. It isn't anymore. That is what scares the hell out of me.

To understand my position you have to put things into perspective. I've kept track of my previously sold positions in the oil sector as I have mentioned before. Had I held on, I would have been wiped out. It is as if I have experienced the pain, but didn't have to feel it. With that kind of fright looking at me dead eye in the face, I am a lot more conservative with my investments now.

I bought VRC, SLB and CDG based on this little rally we had last week. I'm probably going to dump 'em in the AM tomorrow if the rally continues to fizzle. I can deal with 10% losses...not more. That is my limit now (especially since I have seen 110% losses in my "had I held portfolio).

We will probably see more downgrades and earnings cuts into next month (hence LT's prediction). I'll wait 'til then for some kind of re-entry
if next week continues the slide of last.

Concerning the oil sector. It has been so beaten up...in major, long term market corrections, my understanding is that previous laggards often fair worse. That's us.

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