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

To: John Madarasz who wrote (41995)	3/2/2000 9:23:00 AM
From: Lee Lichterman III	Respond to of 99985

Just wrote this on another thread... . I don't think they can afford to let the NASDAQ go down here yet. There are mostly a few hundred to 2000 calls and puts in the QQQ until you get down below 200. Down there, there are over 7000 puts open so I think the incentive to hold it up until expiration is clear. Of course the Premiums on QQQ are almost as high if not higher thanthe OEX so that gives some fudge factor depending on when they were sold. As per my other post, I forget which board, even though the DOW is acting weak taking 3 days to retrace last Friday's loss, and the underlying stocks are also weak, my weekly DOW stuff is showing we are nearing a bottom and should head up in the near future. I am not sure what to make out of it. Best guess is, one more bout of weakness if we don't move up strong on economic news this week, then we blast off. Next problem is where will the money come from. A rotation out of the NASDAQ is the first obvious solution but knowing the open interest in puts is so high, I doubt they want to let the put buyers win one. CSCO, EMC, SUNW, MSFT etc have been just laying around the last few days so maybe a sell off in the smaller issues and a pump job in the heavy weights to hold up the NASDAQ/NDX while they pull all the profits and internals out without J6P noticing? That is my best guess there also. Problem is that doing that will push the NDX up and break out of the wedge for a head fake. This period has been reminding me of 1994 for months and months ( other than reminding me of April 1998 in how they gutted the DOW before they let it drop). Looking at '94, it too played games all spring before it had the washout then finally let the broader market move up well into April. When all is said and done, I think we maintain in the NASDAQ until option expiration/triple witch, then they pull the plug inthe NASDAQ and possibly fuel the DOW if it doesn't blast off sooner. By summer the two will be back in sync. I would be more comfortable buying the DOW if it would retest the recent lows first though. There are some real bargains emerging in the underlying DOW stocks with some trading at values of over 5 years ago. The triple witch FOMC combo is going to be very interesting. <ggg> EDIT - Just realized next week the SPOO traders will be unwinding to roll out to June contracts, any ideas as to how this affects things???? Good Luck, Lee

To: John Madarasz who wrote (41995)	3/2/2000 11:35:00 PM
From: Dwight E. Karlsen	Read Replies (1) \| Respond to of 99985

"And it seems as though Americans are determined to demand more and more new cars, which, of course, implies the demand for more and more gasoline." This seems simplistic and wrong, since it doesn't take into consideration the number of old cars being scrapped. I have yet to find someone who can drive two cars at the same time. The old one is going to be parked, traded-in, or sold. If traded-in or sold, yes, when it sells, the new buyer is going to drive it. However, their previous car is going to go through the same process, until you have someone who buys a car, then calls a junk-car processor to come pick up their previous car..voila, no new net driving.