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AQ, In no particular order I would like to address several points you bring up in your "macroview post" that should be thoroughly exhausted with you or anyone else interested in dissecting this market going forward. 1) BKX broke down to 626 and I hope you can help me with this interrelationship via the broad market going forward. Truly, once this shakes out there will be tremendous opportunity in the banking sector going forward. However, given the calamity of the seriousness of this configuration from a negative TA standpoint, I would simply stay on the sidelines in this index and group in general until a bottom and retest of a bottom is put in play. Simply put, not here and not now, IMHO, unless you can convince me of a very plausible argument why to bottom fish now. Which leads me to #2. 2) why in the sam hell is the 30 treasury yield down to 4.7 something percent?? Surely there is this flight to quality but what is the underlying message? Junk bonds spreads relative to AAA paper is at its widest point since 91' and it may exacerbate even wider... Why is this? Deflation? Markets have already factored in coming deriviative problems and unwinding of speculation. But is there more??? How about the ECU coming on Jan 1, 99 and the D-mark now acting as proxy for new currency unit and $$ now taking a backseat? Help me on this, sir IKe...Lower $$ is confidence crisis in Bubba's ability to lead and paralysis of his own unbecoming outside activites. DAX is new leader no doubt going forward with CAC as supporting cast. 3) I was most impressed that 7550 held like rock of gibralter. We now know where serious line in the sand is drawn for BEAR/BULL tug of war. I read a report that there was a huge buy program 15 minutes before the bell that accounted for 106 points of the DOW reversal. I have no proof of this and even checked time and sales of several Dow stocks. However, this support will be tested again, and this last test WILL FAIL, IMHO. I've read Abbey and Goldman and I truly believe one more shakeout is in the offing. Then we can re-establish supports and go from there. Just some thoughts... JT |
