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Strategies & Market Trends : Technical analysis for shorts & longs

SPY 690.27

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Dec 26 4:00 PM EST

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To: Clint E. who wrote (18314)	11/5/1998 9:40:00 PM
From: j g cordes	Read Replies (1) of 69246

Hi Clint and hello thread.. a number of guru types and ta projections are posting 1150 as the trading top. In some cases its not only a trading top but the beginning of an extreme slide taking the S&P down to the 850 area by January (6750 Dow), or -2250 pts from here.. Its worth while to look at what might support such a move. Two obvious ones are that interest rates won't be cut as expected, then we're faced with a no-cut and earnings expectations undermining the current market. Consumer spending is the bedrock of this market, indeed its relied on world wide.. we're now in a 60 year low on the public savings rate with no counter support from increasing wages. "Consumer jitters" will soon hit the market talking heads. Thanksgiving black Friday will be a retail hold your breath. I'd add another quickly, which is that we're conditioned to run with a market direction easily up or down. This current rally took many by surprize for only a week or so before their extreme pesimissm became extreme optimism. The same can just as easily reverse sending the market into a downside capitulation. The current run from approx_ 925 to 1133 = 208 sp points A very normal 1/3 retracement would take us down approx_ 70 points That's roughly 550 Dow Average points. A 50% retracement would be about 820 points. The downslope on selloffs is roughly twice as steep as the climb. This rally has taken about a month.. if selling began in earnest next week for example we could see 8150 by November 20th. Not yet a prediction, just noting the diameter of gravity. Jim

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