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

To: AllansAlias who wrote (45006)	4/4/2000 7:59:00 PM
From: HairBall	Read Replies (1) \| Respond to of 99985

Allan Haggett: You will find a lot of sports metaphors used on this thread...<g> But I'll not step on heinz's explanation... Regards, LG

To: AllansAlias who wrote (45006)	4/4/2000 9:48:00 PM
From: pater tenebrarum	Respond to of 99985

Allan, certainly...it used to be that brokers and banks, let's say financial stocks in general, were regarded as a measure of the market's health. this may not be true to the same extent today as it was in the '70's and '80's, but the '98 swoon for instance was preceded by a new high in all major indices on a day when brokers had a pretty harsh sell-off. so the brokerage stock warning sign worked well for that particular downturn. the theory behind this is that the brokers to a large degree prosper when the market does, as they get more commissions when trading volume is high, and are able to do more deals like IPO's and mergers. in a bear market, or following a sharp short term market downturn this type of business usually dries up. the stocks often signal impending market weakness with a small lead time... regards, hb