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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Jerry Olson who wrote (17979)	6/20/1999 10:01:00 PM
From: Doug R	Read Replies (1) \| Respond to of 99985

OJ, It's good to be type "B" ;-) The main point is that there is now no possibility of lower rates looking out at least a year. That may be what hasn't been factored in. If it starts to become evident that the "no more inflation" crowd is right, it could be quite a while before the type of gains seen over the last few years will have a chance to resurface since a threat of recession also wouldn't be there to prod the Fed into lowering rates. That would keep the Fed leaning toward a tightening bias. (with "leaning toward" a tightening bias not really being the same as "adopting" a tightening bias....the newest Fedspeak) If the Fed opts to wait until August, the market remains rangebound until then and a few eyebrows raise up thinking, "well, they took their time and made good and sure it was the move to make AND since it's the move to make after all that time, maybe there is some inflation lurking around the corner."...and the market starts sliding. Hitting us with a rate increase now would be better. Any drop due to a miscalculation by the "already factored in" crowd would definitely go too low. But the market always does that anyway. The Dow 9700 number comes out of last year's IHS. That's the level for a hard retest of the breakout. I'm using the S&P to get a timing handle if it occurs. Have you looked at PIXR lately? Looks like it's going to make a move well over 60. There's gotta be some good option stuff happening there. Doug R