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

To: donald sew who wrote (32608)	11/6/1999 1:46:00 PM
From: Benkea	Respond to of 99985

urbansurvival.com Shepler Capital Management: Weekly Outlook for 11/8 - 11/12/99 Time to Buy Dips? In last week's commentary we stated: "Our intermediate-term indicators are all now on solid buy signals and our Elliott wave count suggests that Dow 13,000 and SPX 1600 levels could be seen before this uptrend is complete. By all counts it appears that the bull is back, and that bears have gone into hibernation for the winter. Short-term we expect a minor high in the 11/3 +/- 3 trading day timeframe, we are in the timeframe now, so some type of brief pullback could be expected in the days ahead. We would view any such pullback as a buying opportunity." Very short-term overbought readings at the start of this week led to some sideways choppy trading for the market. Considering the previous weeks massive rally, this weeks selling was relatively subdued. Market internals continue to show signs of improvement, with impressive volume and breadth numbers being posted all week, and NYSE new highs threatening to overtake new lows. However, as we noted in last week's update, our cycle analysis called for a turning point high in the 11/3 +/- 3 trading day timeframe. We believe that this high was posted at Friday's morning high of 1387.49 SPX, which should be followed by some weakness going into the 11/16 Fed meeting. Positive beginning of month seasonality expired Friday, and next week is pre-expiration week which is typically a countertrend affair. Also today's higher high in the SPX showed a bearish divergence versus 5 day advancing volume, in addition to some bearish momentum divergences on our hourly charts. So, while we look for some potential weakness next week, we continue to view any pullback here as an intermediate-term buying opportunity. In fact any sell-off into Friday 11/12 would set-up the "buy the Friday pre-expiration week" trade. There is good support around 1330-1340 SPX region for any pullback, and below that critical support around 1310 SPX. Resistance is at 1390 SPX, and above that at 1405 SPX, and finally the July highs of 1420 SPX. In short, while the market could see some downside action next week we would expect the rally which will follow to bring new highs for the Dow and SPX to join the new highs which are already being posted by the NASDAQ. And this next rally could be very explosive in nature based on seasonality, cycles, and our Elliott wave count. (c) 1999. Bill Shepler - You can write to Bill at wshepler@yahoo.com

To: donald sew who wrote (32608)	11/7/1999 9:43:00 AM
From: MonsieurGonzo	Respond to of 99985

Donald:" oilpatch " >I checked the charts on DEC CRUDE (CL99Z) and it appear that it has already started to bounce off of a HIGHER LOW, but the OSX has not yet reacted to the upside... ...yes, that's true Don; there is an apparent divergence. In the shorter-term, OSX.X - OilService Sector follows almost every whim of the crude oil price futures. In the intermediate term, OSX follows crude oil stock levels, and there has been a lag in demand so far this cold-weather season, resulting in some stocks build-up (which may account for some of the divergence with price right now, in addition to seasonal unwinding of positions). In the longer-term and more fundamental sense, OSX follows the onshore+offshore active rig count, and is affected by the cost of kapital. IOW, it's a good idea to be aware of not only price, but also stocks and rig count trends. Oil biz buzz in Houston is that fundamentally, XON BPA RD management are more focused on absorbing acquisitions, reducing costs - rather than exploration & new capital equipment investments, fwiw. For the sake of our currency, bondz and transports, Don - I'd like to see oil prices stabilise into a trading range, not lower than $18/bbl, nor higher than $27/bbl. -Steve

To: donald sew who wrote (32608)	11/7/1999 11:13:00 AM
From: NickSE	Read Replies (1) \| Respond to of 99985

FWIW, my P&F read on oil... CLZ9 - Dec. 99 Crude Oil - Last 22.92 charts.quotewatch.com Remains in an uptrend and will generate a double top buy signal with a break of 23.8. Resistance level at 24.7± (previous top). Support levels at 21.6 & 20.6 and at 19.6 (bullish support line-critical). OSX-Oil Service Sector - Last 69.31 204.232.40.6 Remains in an downtrend and has generated a double bottom sell signal with it's break of 70. Support levels at 68 and 66. In order to reverse trend it would have to penetrate its bearish resistance line at 76 and confirm at 79. XOI-Amex Oil Index - Last 472.75 iqc.com As of Friday, is in a downtrend with its penetration of its bullish support line with two successive double bottom sell signals. A break of 470 will confirm the downtrend. Support levels at 445 and 425. In order to reverse trend it would have to penetrate its bearish resistance line at 520 and confirm at 550. OIX-Cboe Oil Index - Last 276.27 bigcharts.com Has recently entered a downtrend and been confirmed with its penetration of its bullish support line at 288. Support levels at 260 and 250. In order to reverse trend it would have to penetrate its bearish resistance line at 296 and confirm at 304. I checked the charts on DEC CRUDE and it appear that it has already started to bounce off of a HIGHER LOW, but the OSX has not yet reacted to the upside. This looks like the 3rd test of the bottom for the OSX. I think that the 68-69 range is a fair spot to step in although there is still a chance of retesting 66-67. Note: Support and resistance price levels are based on an intraday movement and not closing. Regards, Nick