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Strategies & Market Trends : Z Best Place to Talk Stocks -- Ignore unavailable to you. Want to Upgrade?

To: Larry S. who wrote (22555)	3/18/2000 7:38:00 AM
From: Ron McKinnon	Read Replies (1) \| Respond to of 53068

from briefing.com Weekly Wrap: Suffice it to say, it was an interesting week of trading complete with a biotech meltdown, a blue chip meltup, and a Nasdaq correction. There was record volume, record intra-day point swings, record one-day point gains, and record weekly point gains. In short, there was a lot going on, but one thing about this week stands out above all others: it pays to be a momentum investor. That may not be what your parents and grandparents taught you, but it is a new lesson being learned by all, and today's student knows that when momentum shifts, you shift with it. If you're fortunate enough to identify the shift early then you'll find yourself riding on easy street for a day or two-- or three-- as the rest of the market follows. That's what happened this week as the momentum shifted in a big way from the new economy tech stocks to the old economy blue chips. The biotech meltdown on Tuesday was a precursor for the attitude adjustment as tech traders were scared by thought of how quickly a highflying stock can fall on the slightest of bad news. And most were holding on to plenty of highflying tech stocks. That said, they weren't scared by the thought of owning equities, and knowing they still needed to make a living, they looked for returns elsewhere, quickly determining that the badly beaten down blue chips were the place to go. If nothing else, these stocks afforded them minimum downside, and a safe haven in the uncertain tech environment that had been born out of the biotech downfall. Sure enough, that rotation got the ball rolling, and before long, the momentum game was on and stocks like Clorox (CLX), Home Depot (HD), and American Express (AXP) were going through the roof, achieving the gains in two days that had once been the norm for an entire year. So, the question is begging to be asked. Can this blue chip resurgence continue? The simple answer is yes, because this week's action was healthy from a technical standpoint and certainly drove home the fact that these stocks have intrinsic value. Will it continue with such conviction? The simple answer is no. Why, you ask? Because the momentum crowd measures returns in days, not years. They've gotten what they wanted out of the blue chips, and if there's one lesson they've learned, it is this: the tech sector is their true domain