Christopher: Read your TA with interest. Thought you mght like to know what Accompara said yesterday, when he confirmed his Monday call.
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Near-Term
Yesterday, the DJIA closed down -158.08 points to 9,133.03 or -1.70%. Tuesday's decline confirmed our near term concerns. Technology stocks and the Internet group are unwinding and will continue to be a drag on the over all market. On a percent basis, the DJIA is going down less than the NASDAQ Composite and the S&P 500 because it has less exposure to technology. This better relative performance will most likely dominate during this sell off phase.
On Monday, we listed a host of reasons for this anticipated weak market. So far, we are just in the early stages of this sell off. Be defensive and wait until we give you the all clear signal before you consider being aggressive on the long side.
S&P Mid Cap. Index (361.92)
Previous Support $370.00
New Support 343.46 (12/14/98)
S&P Small Cap. Index (164.30)
Previous Support $170.00
New Support 160.87 (12/16/98)
Russell 2000 Index (403.13)
Previous Support 412.13
New Support $387.61 (12/14/98)
The NASDAQ Composite ( 2310.79 ) has recently broken its three and one-half month uptrend with the move below 2400. This suggests initial risk to the January 5th low seen at 2206. The weakness which has been seen in some of the broader indices such as the S & P small and mid-cap, suggests a growing risk of violation of the 2206 area on the NASDAQ composite. A break below 2206 would suggest additional risk to the November 27th low of 1994.66. Similarly, the critical test area for the Dow Industrials is seen at the January 25th low of 9063, below which risk would exist to the December 14th low of 8676. |
