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

To: bruce-l who wrote (35546)	5/19/2000 3:23:00 AM
From: Doug R	Read Replies (3) \| Respond to of 79240

Bruce, The ratio is in dire need of breaking hard over 1.7 in order to instill significant confidence in taking bold long positions. There'll always be stocks that have short term surges but there is nothing to say that they won't get fewer and farther between. Just as real estate is "location, location, location...the market is direction, direction, direction. Get the location right and you win....get the direction right and you at least lower your chances of losing. Clear the last 3 years from your head.... The market generally discounts forward growth prospects 14 to 18 months out. Fed hikes generally do not make an impact until 8 months after initiation. That disparity is what causes prices to stretch the rubber band too high. It's a technical thing. The market gets 6 to 10 months ahead of itself and doesn't begin to revert to the mean until the fed has already tightened for 6 to 10 months. All we've seen so far is just the initial move toward reversion. From here...there is now a downside timeframe that will discount further fed hikes with a 3 to 4 1/2 month lead. That's enough time for 2 or 3 more hikes and approximately 14 to 20 more weeks of uncertainty. The market hates uncertainty. But 6 to 8 weeks before the last hike is in...the market will know. This all targets the last hike for mid-Sept. or early Dec. and an end of the whipsaw junk between end of Aug. and middle of Oct. Coincidentally enough...this approach is in agreement with the magnet read given by DJ last week. Doug R