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Strategies & Market Trends : The 56 Point TA; Charts With an Attitude -- Ignore unavailable to you. Want to Upgrade?

To: hman who wrote (35467)	5/12/2000 3:35:00 AM
From: Doug R	Read Replies (6) \| Respond to of 79230

David, I have been extremely bullish about the long term prospects of the market on SI since the inception of this thread...nearly 35 months. Every time over that period where I have temporarily suspended aggressive long side trading in order to avoid corrections I have tended toward "reasonably" (imo) overstating downside potential in order to drive home the point that capital preservation should be of paramount concern. I've yet to miss a correction call over that time but you should be aware that when I suspend my long side trading, I am not calling for a "crash". Actually, from my point of view, the labeling of any market as bull or bear or crash or correction or flat or whatever is quite irrelevant since labels only cloud reality. Labels are arbitrary. What stocks do...what markets do is reality. Knowing what stocks and the market are doing does not depend on any label. I may be going conceptually deeper here than the answer you are looking for but I feel it's important that I make these points. I'm glad to know that you took actions based on what I've ascertained that have been profitable for you. I do not want to even try to make decisions for you but I can provide my assessments for anyone that cares to assimilate them into their own decision making processes. OK...now that I've hemmed and hawed enough... 4 to 6 weeks ago the market entered a period of a high degree of predictability, therefore providing a few weeks of opportunity to greatly outperform (I took advantage of this with GLW, NSOL and a few others during that time). NOW.......the market is entering a phase where there is a greater risk of being "whipsawed". Over the last 4 or 5 trading days this prospect has begun developing as a "trend" and a few of my trades were disappointing (exemplified by the RFMD trade.....fortunately I did not seriously go after NXTL). Given that the truly long term outlook of the market is still up...this whipsaw period will very likely resolve itself in a resumption to the upside. It's difficult at this point to say how dramatic that upside might be but when upside resumption is established, it will be important to place much less emphasis on short side activity in keeping with having a handle on what stocks do. In the larger timeframe, the current downswing over the last several weeks can be viewed as an intermediate term contra-move. Within this swing down there have been shorter term upswings (like today) that are counter to the intermediate term. It's now becoming apparent that the juxtaposition of long-term/intermediate-term/short-term counter moves are beginning to enter the gray area of whipsaw city. This is an indication that the predominant trend is "preparing" to reassert itself. With all this in mind...and...with the understanding that PPI, CPI, Fed meeting and a weekend are all converging here...I cannot be prepared to endorse hardline shorting beyond this coming Monday. My next task is to try to winnow out the influence on and by the technical profile in regard to this month's options expiration in relation to overall volume considerations and how the S&P's 13 dRSI behaves after the Fed hike. stay tuned, Doug R