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Strategies & Market Trends : A.I.M Users Group Bulletin Board -- Ignore unavailable to you. Want to Upgrade?

To: Jack Jagernauth who wrote (10534)	3/21/2000 10:20:00 PM
From: OldAIMGuy	Respond to of 18928

Hey Jack, Yes, the 60% is spooky, but I'd really be concerned if all four components were singing the same sour note. That's when I know there's no good to come from the market in the short term. In this case, we have the Speculation index way out of control and the Divergence index confirming people's worries. It shows lots of new highs and new lows simultaneously. This indicates lots of investor confusion. My guess is that it will sort itself out quickly (and painfully for some) and then get back on track. I've never seen low P/E values like this at the same time of such silly speculation. My only guess is that the stocks being speculated don't earn money, therefore the Value Line P/E can be as low as it is. V/L only includes stocks that have earnings in their data for their P/E. (I guess it would be pretty hard to figure the P/E of companies that don't earn anything! :-) ) Yes, I'm concerned, but I've raised a ton of cash in the last year. It would be fun to have an excuse to put it all back to work! Relative Valuation is showing some pretty attractive numbers. It's usually been low only when the market's already been clobbered. I guess there's plenty of stocks that have been, but the NASDAQ hasn't shown it yet. Relative Valuation has usually tracked the indexes very well and been a good indicator. It's showing a very bullish value right now. I think we have to assume that it's "bullish for some" this time. I always like it when the ZEAL! index is low like now. It indicates that the number of issues available for investors is shrinking. This tends to concentrate the available investment money into the smaller number of remaining issues. I don't have the numbers here at home, but I believe the NASDAQ and NYSE combined has about 1000 less stocks available now than at its peak about 12 to 18 months ago. Even with all the IPO's the overall number of issues is declining. This has always been bullish. So, the Idiot Wave is showing Multiple Personality Disorder right now! I guess we'll know soon enough who wins! I'm glad you enjoyed the report and the graphs. Best regards, Tom