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

To: Jerry Olson who wrote (40123)	2/13/2000 11:35:00 AM
From: Michael Watkins	Read Replies (2) \| Respond to of 99985

Hey OJ, I've seen you refer to the NYSEBP - can you clear up for me what that is? I've been following the NYA closely and it offers the most disturbing picture of all the markets. 615 I consider the main lower support level for the NYA's primary uppermost trading band, and Friday the market closed well below it. 630 I consider key upside resistance from here. Three times the market has penetrated and closed this low since Aug. Once it rallied to just above 630 and within 3 sessions moved lower again. The other two times it moved lower immediately. The picture is strongly one of a failing market. I don't disagree with you in your expectations of a rally from here, it seems perfectly possible. If it occurs I'll be watching the 630 level very closely for failure. I think the risk of it failing is higher here tho, this is not a healthy market picture - 6 tests of an important support and two major failures already, three if you count Friday but that story is being told still. Put another way that we can all appreciate, with thousands of stocks out there, if we saw this chart and were looking to go long something, we'd move on very quickly. Which is exactly what has been happening... to the Nasdaq... OJ - what would your charts say if the NYA moved up to 630 again? Is that a 70% level? Maybe a rally happens and then it slams back down. I sure would like to see the NYA move strongly above 650 before it could be pronounced healthy... Re bias, not to worry. Even though my gut and charts say this is a balance point of some significance right now, I still trade based on the market immediately in front of me. If it says up, I'll be there. (ok, one last bearish thought - with a "Tale of Two Markets" happening I do wonder what will happen if the tech market pulls back strongly and how it will impact the rest. We can't chart that one until it happens. I'm enormously interested in the outcome - I hope it doesn't resolve next week with a dull whimper (in any direction), it seems as though the conditions for a big move are in place.) PS: If you could prop up the market on Monday I'd appreciate it. I will only be trading the opening moves on Monday as I've got meetings at 11:30 ET.