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To: Glenn Petersen who wrote (30)	5/7/2000 8:35:00 PM
From: Big Dog	Respond to of 50

Glenn: You may be right about being patient here: "Market needs more conviction" Market Snapshot By Julie Rannazzisi, CBS MarketWatch NEW YORK (CBS.MW) -- The market's surprising rally in the face of strong economic news Friday was encouraging, but the run-up lacked the kind of backing needed to make it convincible in the long run. "We saw a buyers' strike throughout the week. There was no liquidity and people were on the sidelines," said Terry Gabriel, technical analyst at IDEAglobal.com. "It will be pretty choppy heading into the May 16 Federal Open Market Committee meeting." Most market watchers believe the April employment report has sealed a 50 basis point rate hike. But Gabriel said, players remain uncertain as to the number of Fed rate hikes that will follow. "The market doesn't have a sense of what the Fed will do in the June through August period," Gabriel continued. The Dow is down 1.5 percent for the week while the Nasdaq lost 1.1 percent. The volume debacle The recent dearth of trading volume -- Friday's Nasdaq volume was the lowest of the year -- suggests lack of conviction on the part of investors,ÿ who continue to lick their wounds following April's bruising sell off. "If we go back to the start of this rally phase on April 17 -- the day following the now infamous CPI -- it's striking how little upside volume there has been. In those 13 days through Thursday, volume expanded in a rally only once on the NYSE and only twice on the Nasdaq," notedÿ Frank Gretz, chief strategist at Shields & Co. "The low volume suggests that despite some impressive price gains during this time, there was no real buying. And a sustained rally isn't about a lack of selling, it's about buying," he continued. Still, though the lack of volume in the recent rally helps argue that prices aren't going to run back to their highs anytime soon, it doesn't argue that there will be a new downdraft, Gretz added. In fact, there appears to have been enough of a washout in many previously extended Nasdaq stocks to say that the lows have been seen -- or are near, Gretz opined. A trading range environment appears the most likely scenario for most Nasdaq stocks, he concluded. ragingbull.com