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

To: bobby beara who wrote (18674)	6/28/1999 6:50:00 PM
From: pater tenebrarum	Read Replies (2) \| Respond to of 99985

Bobby, an alternate count would be for wave 5 (as depicted on the chart) to actually have been wave 3 with the symmetrical triangle representing wave 4, in which case the fifth wave up would still lie ahead. this would conform with the blow-off scenario. my bearish contrary indicator post on the MITA thread seems to have worked, as the market promptly went up<g>. i would generally prefer the blow-off scenario as a fitting end to this bull market as well as being more in tune with historic precedent, which has the market rallying further after the first rate hike . some of the sentiment measures have shown a slight improvement due to last weeks decline, but they tend to flip immediately back whenever the market shows strength. this has produced a trading range; i am waiting for either a rally to develop that isn't trusted, or a decline that isn't being worried about to gauge which way this thing will break. as i have stated before, neither bulls nor bears can really claim right now that their respective favored scenario is backed by the better arguments. on a rational level, the bearish arguments may seem more sound, but this market has long ago left rationality behind. it can only be measured by the standards of a mania and not traditional fundamental models. still, even if fundamental considerations such as the absurd overvaluations are discarded as irrelevant, it has to be noted that the advance from the october lows to date has been lacking with regards to many of the technical underpinnings that characterize a true bull market (as i have pointed out in my MITA post). i think if a sharp correction were to occur soon, the long term health of the market would be better served than by a strong advance from current levels. many people have wisely chosen to be on the sidelines to await the market's reaction to the FOMC decision. on the other hand, the stocks that have been sold by those now watching and waiting have been bought by someone else, who decided to take a gamble on a 'summer rally'. in the meantime the low volume zig-zagging of the market has built up a lot of tension, and the longer it continues, the bigger the tension gets. that makes a melt-down and a melt-up equally likely outcomes imo. the move, when it comes, will be huge. regards, hb