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To: Bill Harmond who wrote (93157)	2/8/2000 1:21:00 AM
From: Rob S.	Respond to of 164684

Hi William. I think the market is pretty close to topping out. Of course that may be an ambiguous statement - the "market" is more than ever made up of several sectors - some of them have soared and some of them have tanked while others have just treaded water. I think the tech stocks will likely come under pressure within a couple weeks and either trend sideways or down. There are several cross currents that I think will influence the techs, many of them aren't very clear. Of course there is the healthy growth rate for electronics including semis and communications equipment. But then the stocks are highly valued and that good growth story has already been factored in IMO. Contradicting that is an indication that companies may have anticipated that growth and have laid in larger than needed inventories of components and finished goods and the order pipeline may have gotten ahead of itself. Lucent, Tellabs and others have reported that some adjustments are needed and inventory levels have been reported to be higher for memories and some other components. Consequently, lead times and prices have dropped recently after several months of resisting the "normal" downward pricing pressure indicative of semis and other segments of the electronics industry. The Asians have been rapidly adding capacity for commodity components such as memories via process shrinks and build outs. Demand for processors remains robust but a few analysts have the opinion that because AMD and Intel are bringing on capacity at a much higher rate than demand. And because Intel has indicated that they will aggressively defend their market share against AMD's move into the high end, a price war will ensue by this summer. In the past when Intel and AMD went at it for market share the result was a downward spiral for most of the semis. Contradicting that trend is the fact that growth in the communications and networking sectors is becoming a larger part of the overall industry. But then, the communications sectors look very pricey and any problems with related sectors will cause a chill in them as well IMO. From a TA standpoint, several analysts have pointed out such things as violent swings in the market and divergence between sectors as being "topping action". Of course they have been often wrong in the past. But I think there may be something to that at this juncture. The accumulation indicators look surprisingly weak for most sectors despite the recent sprint back up, including the highflying techs. Guessing the direction of the market is perhaps a fool's game, but my guess is that this great run up has only up to several more days to go before it at least pulls back modestly (10%-15%). There is a distinct possibility for a 20% pullback but I won't guess at a 25% pullback (maybe after the fact as do most of Wall Street's analysts).