Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Les H who wrote (37093)	1/9/2000 7:05:00 PM
From: bearshark	Read Replies (3) \| Respond to of 99985

Does anyone know how to post a simple excel document to this board without it turning into gibberish? I have tried "Use Fixed Font" with no success.

To: Les H who wrote (37093)	1/9/2000 10:15:00 PM
From: StockOperator	Respond to of 99985

I know my posts have been infrequent as of late. The unprecendented move in prices for tech stocks during the past two months has left very little to discuss regarding MDA. Although overall breadth and valuations can always be debated, the same was true last year at this time. However, the trading action in the new year once again brings into question where this market may be going. In my last post I made the comment that I thought the Dow compared to the rest of the avgs had less room for slippage. I said this because overall the Dow is still trading within a tight consolidation pattern months in the making. The Naz on the other hand is in its third month of a breakout, exactly why we have seen such an explosive move up. Technicans love to see bullish consolidating patterns because they have a good idea once that pattern breaks, prices will usually be taken to a whole new level. With the break in prices a new trend is established (from that breakout) that is usually much faster and tighter. So far we have seen that for the NAZ composite and what we are also beginning to see for the RUT as it breaks into record highs. A quick look back to 1995 on the chart for the DOW would reveal a similar type pattern. But despite the record for the DOW on Friday's close we do not as of yet have a break of its longer term pattern. Prices are running into the upper trend line resistance here. But despite the volatility of the past week the DOW did manage a 25 pt. gain overall. Which may not sound like much but in the context of the overall volatility a gain period is significant. Prices for the RUT, S&P and NAZ all closed at their highs of the day indicating significant buying pressure. Utilities had an impressive week but according to my work are now hitting serious resistance from a trendline that shoots down from the break of their highs set eight months ago. I honestly believe they will have to back and fill some more here before breaking out. When looking at interest rates I have yields running into MY last point of resistance on the chart. This entire move is 16 months in the making while the last great move in rates (93) last 13 months. A break above this resistance area would cause me to reconsider my longer term analysis that rates overall are heading downward. We should get our answer in the next month or so. Let me just add that when looking at the overall trend for the utilities as well as the yield on the 30yr combined with the fact that everyone and their mother is expecting higher rates I still believe that we are going to see an explosive move higher in the utilities as well as an easing in rates. In a nutshell you have the NAZ, RUT, S&P and DOW breaking into record territory. The utilities and transports both at multi low support areas on their charts perhaps just now beginning to make a break. Combine this with a make or break position in the bond market and I believe we are about to see a more broad based move in prices overall. Of course be aware that I believe this analysis is dependent on rates overall. Here are three stocks that are worth watching this week. They have what I like to call "do or die" patterns in that prices have worked there way into a position where a breakout or breakdown is inevitable. They are CMRC, PRGY and LAUN. My initial read says they should break higher however a breakdown is always possible. Good trading. SO