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Strategies & Market Trends : MDA - Market Direction Analysis

SPY 662.63

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Nov 19 4:00 PM EST

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To: dennis michael patterson who wrote (2578)	12/22/1998 9:53:00 AM
From: donald sew	Read Replies (2) of 99985

INDEX UPDATE ================================== The DOW pulled back 90 points off its yesterdays highs, and such action satisfies the minimum requirements of the my CLASS 1 SELL signal(75 points). Now the question is whether it will continue to the downside. I am still sticking with the position of a ZIG-ZAG pattern in the STAIR-STEP. Little upside/downside for the last few trading days of this year. On the negative side: the BUY-IN day for my SELL SIGNAL is today but the DOW reverse 90 points off its highs yesterday which is significant. This implies that the reversal may have started earlier, which implies a little more weakness than expected. Statistically, when a reverse occurs before a BUY-SIGNAL implies strength and befor a SELL-SIGNAL implies weakness. The reverse also applys when a BUY-SIGNAL is late implies weakness, and when a SELL-SIGNAL is late it implies strength. Hope I made some sense. Please keep in mind that per my system time is more crucial than price movement. I noticed 2 bullish signs: 1) yesterday the NEW HIGH jumped up substantially to over 100. 2) the market was up big intraday on negative TICK, while the up volume was far greater than the down volume(at the highs). My understanding is that the TICK indicates the number of orders(not volume) executed at the ASK price compared to the BID price, so there were more orders selling than buying, but the market was heading up strong. Tie that with the fact that the up volume was significant higher than the down volume, such implies that sell-orders were smaller than the buy-orders. I am assuming that the such implies that the big-boys were buying while the smaller players were selling. I am no expert in this area so if I am off-line, please comment. Those 2 bullish signs should not be discounted, since it is implying that there is buying power. Most doubt that the FEDs will reduce rates today, but if they do that could over-ride the technicals, and push the market up strong. Seeya

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