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

To: Crimson Ghost who wrote (46392)	4/14/2000 11:17:00 PM
From: Secret_Agent_Man	Respond to of 99985

the dow is still too high even after today, the bubble still exists...just look at AMZN.... the NAZ should absolutely retest last years low 2329 and the dow could to get to 9500.(+/-) 200 The whole bubble needs to be popped not just part...then start with real fundamentals not hype...the houses have long since lost any credibility as well as the bubblevision puppets...all bounces could be sold until fair value is trully reached....then the cycle can begin again...the crash of the millennium was and is still due... prophecy not yet fulfilled. Abby Cohen "death of a sales-woman" cheers

To: Crimson Ghost who wrote (46392)	4/14/2000 11:39:00 PM
From: pater tenebrarum	Read Replies (5) \| Respond to of 99985

George, nevertheless, the countertrend rallies will likely be quite powerful...and probably will only serve to trap more inexperienced investors. but they will be playable... re: POG, agree on your common sense remark. a price of 180 would lead to a wave of mine closures and the cost of production is a lot higher than that. heck, the replacement cost for currently mined gold (i.e. exploration costs + cost of starting new projects) is roughly around 350/oz. which is why it makes no sense to hedge at current prices. they are not sustainable anyway. imagine Switzerland announcing on Monday it will keep its 1,500 tons of gold after all...all hell would break loose. the big bullion banks have INCREASED their open gold derivative positions by 50% in Q1. the gold carry trade...which will blow up concurrently with the Euro carry trade imo. bearish bubbles also burst.... regards, hb

To: Crimson Ghost who wrote (46392)	4/14/2000 11:58:00 PM
From: jbe	Read Replies (1) \| Respond to of 99985

Do you think investors have learned something from this debacle? Not a bit of it! Let me share something with you, which I think may back up my point. About a month ago, it finally hit me (duh!) that more stocks had been going down in the past year than had been going up. So I thought it was time to learn about, and then venture into, shorting. In the course of the exercise, I ran a bunch of screens (on Telescan), looking for stocks I thought would be the most vulnerable. What I screened for was the lowest possible eps this fiscal year & next, the lowest possible projected annualized 5-year eps, negative cashflow, high debt, negative interest coverage. Well, the screen came up with a slew of telecom, internet, and biotech companies -- all with little red arrows pointing down (meaning, they were all in a downtrend). That, to me, signalled that investors were finally catching on to the fact that these high-flyers were not really flying anywhere. I was too nervous, knowing the volatility in those sectors (in the past, any such stock could go up 20% in a single day just as easily as it could go down 20%), to short more than two stocks, more's the pity, because as events this week subsequently proved, I could have made a boodle shorting them all. Then, today, I decided to test my hypothesis (that investors had learned something). I ran another screen, this time, looking for companies with reasonable valuations, good 1-year eps, sales, and cashflow growth, and with a projected 5-year growth rate of no less than 20% annually. If my hypothesis was correct, those companies should have done better this past week. Well, guess what. They did a little better -- of the 50 stocks, ten had green arrows (showing an uptrend) -- but most of them had been pummeled as badly as the no-earnings cashburners. Hmm. So then I ran a screen to find the stocks that had performed the best this past week. Well -- what schlock! Most of them I personally wouldn't touch with a ten-foot pole! The only exceptions, in case anyone is interested, were: Fastenal (FAST), Province Healthcare (PRHC), Yellow Corp. (YELL), and Rare Hospitality (RARE). The only thing these stocks had in common was that they were in out-of-favor sectors. I can only presume that most investors' idea of a 'value' stock is one that until now nobody else has been eager to buy (usually for good reason, I would suspect). So -- do investors really understand what is going on? My answer would be that many of them haven't a clue. I would also add -- beware the commentators, who so love to impose a "rational" pattern on events, even though there isn't one (e.g., investors are "tired waiting for earnings that never materialize" OR "investors are worried about inflation" OR "investors are concerned about interest rate hikes" OR whatever...). Maybe chaos theory would provide a better explanation. In the meantime, short them all -- good, bad, and indifferent!