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

To: James F. Hopkins who wrote (19703)	7/8/1999 5:06:00 PM
From: Les H	Read Replies (1) \| Respond to of 99985

FORTUCAST FINANCIAL TIMER PRECISE TIMING AND MOVEMENT ANALYSIS BY BARRY ROSEN “Serving Futures Traders Since 1987” UPDATED JULY 7 FOR MARKETS OF JULY 8, 1999 STOCKS and SEPT. S & P e-minis WEEKLY CHART TREND: Higher to DOW 12658. DAILY CHART TREND: Higher. TODAY'S EXPECTED DIRECTION: Lower. NEXT HOURLY CHART NEXT DAILY CHART NEXT WEEKLY CHART TURN: 7/8 L TURN: 8/5-6 H TURN: 8/99 H SHORT-TERM POSITION TRADING STRATEGY: Buy 1385.25 with a 1379 stop. (07/08) DAY TRADER'S SUMMARY: Wednesday' relatively feeble rally suggests that we are still open to a push lower to 1384 or DOW 10972 on Thursday. Probably it only has a 30% chance. Because of the great upside potential to 1441-1455, traders willing to hold for 3-4 weeks should use a 1379 stop and add at the lower target. Day-traders may have a nice sale setting up on Thursday--especially if the market continues to stay below the 1408 region. Because this market is in transition and it won't take much to turn hourly stochastics higher, it will be better to hold position longs. If we take out the 1409 region, we will change our strategy to buying on the day. Minor cycles do look weak into at 11:15 Central time. With a bullish cycle peaking into late Monday, the influence of that could be felt early so do not get too caught up on shorting this market if it fails to fall. (07/08) Look for support at DOW 11072 and then at 10972 on Thursday and that is probably a place to start accumulating. We should quickly rally into Monday and could even go quickly the 11538 region. Overall, we would continue to accumulate as this bull is not over and we are extending our time window for a high into the first week of August and even looking for a secondary high as late as the week of August 24-28. We are expecting a messy correction between about August 6-11, and it may jolt everyone. OVERALL: The close above DOW 10900 was very positive and now allows the higher target on the DOW to come in at 12,680. That translates at least 1540 on the S & P cash and possibly as high as 1588 on the S & P cash. That means the summer rally should go into full swing. We have been confident that the bonds would rally into July or even early August and that will support a stock market rally so we would buy the dips and continue to hold long funds. Our June 14 position trade long for mutual funds is looking much better now that all the doubt is gone after the post-FOMC rally. BIGGER PICTURE: The technical breakout on Wednesday, June 30, helps eliminate all doubts about a summer rally. We have been feeling that the DOW needed one more new high--and looking at the yearly charts, a pattern completion in the 12,500-12,600 would be very complete. We will watch patterns but expect to at least be higher into the week of August 6 and we are open to further upside in August depending on where we are in the pattern. There appears to be a secondary high as late as August 24-28 if we can get through a nasty cycle in early August. Once the new high comes in, we will get a nasty correction that will quickly go to DOW 9200 and probably last into November; we are open to a deeper correction but will not speculate about it until we can measure it. OEX NOTES: (07/08) Stand aside. SEPT. T-BONDS WEEKLY CHART TREND: Bottoming and higher to at least 118.08. DAILY CHART TREND: Higher. TODAY'S EXPECTED DIRECTION: Bottoming. NEXT HOURLY CHART NEXT DAILY CHART NEXT WEEKLY CHART TURN: 7/8 L; 7/9 H TURN: 7/26 H TURN: 8/99 H SHORT-TERM POSITION TRADING STRATEGY: Buy 114.17 mit and 115.00 mit with a 113.31 stop. Hold into late July. DAY-TRADING STRATEGY: Buy 114.17 or better with a 114.03 stop. Exit 115.25 oco market on close Thursday. (07/08) Bonds are very oversold and could easily turn higher on Thursday and reach up to the 115.15-115.17 region and possibly 115.27. We may not get a pullback and downside action has been light, suggesting that traders are accumulating rather than actively selling. We may be too optimistic looking for the lower targets but we need them for a decent risk/reward. Friday looks much more clearly up into late Monday. Traders with big pockets may even want to accumulate from higher levels as we do see strong upside potential into late Monday. OVERALL, we suspect that we can continue buying pullbacks until we hit the 118.08 region. Higher numbers are possible. LONGER TERM (6/25) The minimum bounce on bonds would be back to the 118.08 region with a max. rally to the 120 region. The minimum time window is the July 26 area but early August is possible for a secondary target. If the market were to just continue falling here, we would expect a move to 104 but that appears unlikely over the next month. SEPT. CRUDE DAILY CHART TREND: Topping. TODAY'S EXPECTED DIRECTION: Higher. NEXT HOURLY CHART NEXT DAILY CHART NEXT WEEKLY CHART TURN: 7/9 H TURN: 7/13 H TURN: 8/99 L SHORT-TERM POSITION TRADING STRATEGY: Cover shorts at 1991. Buy 1991 mit with a 1949 stop. Exit 2060. (07/08) The API's were very friendly and gas appears likely to go to the 6200-6300 region and it should pull crude up to 2025 and probably 2061. Upward energy will probably dominate into Friday's close so we abandon attempts to top-pick this early and wait for a close below 1950 for signs of a reversal. LONGER-TERM: (6/30) Look for pullbacks into July and August before the next major swing to the upside occurs. The next low should hold 1600, and the November high should go to at least the 2856 region if not the 3250 region.