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

To: HairBall who wrote (24974)	9/6/1999 12:15:00 PM
From: Tai Jin	Respond to of 99985

My upside targets are DOW 11200, SPX 1405, and NAZ 2915. Then they will probably come back to retest recent support. So I guess I'm calling for a trading range which eventually breaks down. ...tai

To: HairBall who wrote (24974)	9/6/1999 1:00:00 PM
From: j.o.	Respond to of 99985

Hi LG - I've been looking at the charts all morning, and one thing sticks in my mind...the trading range. The Nasd100 has been trapped in a (slight uptrending) trading range since February, and is right at the top thereof. We had one small false breakout the last time we saw these levels, and if we got a repeat we could see up to 50 points higher in this index before it's significant. In the Dow, the trading range that we've been in since May gives us upside to 11,500. If we were to take out those levels it would look like we had just completed a wave 4 of the upmove since October 98, and have room up to 13,100 to 13,500 (moves = wave 1 and wave 3 in percentage terms). We have just heavily tested the support line of this upmove, so perhaps this is not very unlikely. That said, the Dow is the only index which makes sense of this wavecount. Therefore, I consider this scenario unlikely. The S&P looks like it still wants to make a big H&S, starting in March, with the Neckline around that 1287 level. We could well re-test the recent highs, possibly touching 1400, but everything short of a high-volume break of that level would leave me expecting resolution of this pattern to the downside. In short <gggg>, I would expect some volatile attempts at higher levels over the next few days, but do not ultimately expect success. I will sell into rallies with intent to cover if we breach 2550 NDX and 1400 SPX (breaks on high volume only). BTW - I think that the Dot.x has room to 610/615. Selling into that too. We'll continue to see supply weighing on the Nutz... Call me a C with a prediliction toward B if we start to move back below the 25/50d EMAs. Hope that you are all enjoying the Labor Day w/e... j.o. indextrade.com

To: HairBall who wrote (24974)	9/6/1999 1:20:00 PM
From: James Strauss	Read Replies (1) \| Respond to of 99985

The Market... **************** LG: Interest rates are still the most powerful influence on the market... With a possible third rate cut hanging over the market it's likely that the S&P 500 will retest the 1300 area... It's very important that it holds there... We currently have a junction of the 5, 13, and 20 day MA's... We are at a point of a break out or break down... Given that September is historically the worst performance month of the year for stock prices we are likely to see a continuation of market weakness until we get that third rate hike out of the way... Jim

To: HairBall who wrote (24974)	9/6/1999 1:48:00 PM
From: Lee Lichterman III	Read Replies (3) \| Respond to of 99985

The PPI report could put a damper on my outlook and I think the risk is too high to just try to trade my prediction and walk away but ... I am looking for a rally to around the 1390 area possibly as high as 1410 on the SPX before the CPI report causes a pullback/pause around expiration time. From here, we should remain range bound until the FOMC meeting on the 5 th of October. I predict the Fed will NOT raise this time since there hasn't been enough time to see the effects of the last 2 raises and I am getting TA signals that the TYX is heading down. When the Fed does not raise, we are going to have the mother of all blow off rallies to at least 1500 SPX before the big Kaboom in the spring when China devalues, Russia defaults and "cats and dogs are sleeping together mass hysteria and chaos, we're talking real wrath of god stuff" <gggg>(Ghostbusters) Hey dream big right! Of course in a few weeks or next spring I will deny ever writing this post Good Luck, Lee

To: HairBall who wrote (24974)	9/6/1999 2:34:00 PM
From: Fun-da-Mental#1	Read Replies (1) \| Respond to of 99985

I vote B on the MDA poll because: First of all, 3 obvious reasons already known to this thread: 1) "3 steps and a stumble." Current interest rates are too low for such a hot economy. 2) falling dollar makes American investments less attractive, and gives another reason to raise rates 3) Seasonality. Market only rises in September 40% of the time (Zwieg, Winning on Wall Street) and biggest crashes happen in October, plus there's the parallel with last year. Plus some new reasons: 4) The long-term uptrend that started in the beginning of 1995 is already broken. siliconinvestor.com Long-term growth is usually exponential. This is a log-linear chart so exponential growth plots as a straight line. 1995 saw a break from a high but sustainable growth rate to an even higher, totally ludicrous growth rate of about 25% a year. In 1998 it stumbled, then rushed to catch up, didn't quite reach the long-term trend line, and now it's falling away from it again. 5) Final year of a classic bubble pattern. Refer back to the chart referenced above. The Dow had a 3-fold increase from 1925 to 1929. The Nikkei tripled between 1986 and 1989. Now we've seen a 3-fold increase in the S&P 500 from 1995 to 1999. If the pattern holds we crash this fall. Some people (especially Heinz) see this pattern but expect the uptrend to continue for a while yet before we crash. I've heard two reasons for this: (a) that we haven't yet reached the excesses of 1929 or 1989, and (b) that this bubble will be the most excessive ever. I think (a) doesn't fit the evidence, and (b) is just a wild speculation. We haven't reached the P/E of the 1989 Nikkei (peak 60 I think), but last I heard we were at 37 which completely blows away the previous all-time high for the S&P 500 of 23 (again Zwieg is my source for this). That's right, 23. The P/E was about 20 in 1929. Also I think the P/E of the Nikkei reached its peak while stock prices were falling, because earnings were falling even faster (somebody correct me if I'm wrong on that), and the Japanese tend to under-report earnings for tax reasons anyway, so P/E of Nikkei may not be comparable. 6) Increasing bearish comments from popular analysts. These guys are the leaders of public opinion, and the public has to remain basically bullish to support such high valuations. Bearish sentiment is a bullish contrarian indicator when we're at the bottom, but when we're at the top it's a very bad sign. Sorry if these comments are a waste of time for daytraders but I assume you tuned out already. Best of luck to everybody and thanks for all the great posts here. Fun-da-Mental

To: HairBall who wrote (24974)	9/6/1999 8:04:00 PM
From: Matthew L. Jones	Read Replies (1) \| Respond to of 99985

LG, I, for one, don't have a clue. From my T/A the cup's half... (I don't know if it's half full or half empty). I think most of us sense that the market is at a crucial point... either scenario you pose is viable. I decided to day trade again until the market gives us a little sustained direction. It is certainly a day trader's market! The preoccupation of the investing public with every word that falls from the lips of the Fed is starting to frustrate me. It is apparent that everyone is very nervous and nervous times like these are times when the littlest thing can trigger a huge emotional response in either direction. So there is my 2 cents worth. Sorry I didn't post an opinion when you first asked... I just don't know. MLJ

To: HairBall who wrote (24974)	9/6/1999 11:00:00 PM
From: KM	Respond to of 99985

My guess is B. But I'm a natural born skeptic <G>

To: HairBall who wrote (24974)	9/6/1999 11:28:00 PM
From: HairBall	Read Replies (1) \| Respond to of 99985

Tokyo, Sept. 7 (Bloomberg) -- The yen was little changed near an eight-month high against the dollar on expectations that Japan's rosier economic outlook will prompt investors to shift more funds to Japan from U.S. markets. quote.bloomberg.com Regards, LG