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Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: DonnaS who wrote (26477)	5/25/2000 10:44:00 AM
From: baddtiming	Read Replies (1) \| Respond to of 57584

originally a basketball term. Means you turn your head like your going to move one way when you are actually going to go the other way. Designed to fake the competition into commiting there wieght the wrong way so the faker can break around the other side and break to the basket. In the case of the market, well, you can guess the rest:)

To: DonnaS who wrote (26477)	5/25/2000 11:09:00 AM
From: Rande Is	Read Replies (1) \| Respond to of 57584

Donna. . .A headfake is a form of market manipulation. In football. . the quarterback looks right then throws left to fake out the opponent. . . . in basketball, a player with the ball may look right then pass the ball to the left. . .to fake out the opponent. In the markets, we are the opponents. Market Makers will run a stock down and take out stop losses and limit buys just before a run north. . . this may "shake" shares from weak hands at a low price, leading to easy gains by Market Makers that perpetrate the headfake manipulation and by astute traders who profit from their experienced read of the headfake. In the futures markets, the Standard & Poors 500 Index futures [SPOOS] are often "painted" up. a related form of manipulation, to provide a headfake for what is to be a down day. . . or vice versa. Look at the Dow Jones Industrials intraday lately. It is like a roller-coaster. . . ups and downs . . wild swings. . .each turn looking more convincing than the last. . .with no clear direction set. . . this is also a way to get the Nasdaq to begin to track the Dow in sympathy, which it eventually does. . .especially when the Dow does what I call a "Kamakaze maneuver", where it goes straight down, in order to slow the progress of the Nasdaq COMPX. . .which I've observed even on the best days. The COMPX eventually tracks the movements of the Dow. . . this also serves to take "market control" out of the hands of the small investors which may be driving it with their aggressive buying or selling. . . and back into the hands of the brokerages. Manipulation of the Nasdaq COMPX is harder to do than the 30 stocks of the Dow Industrials. . . so it may take a concerted effort by the futures players, traders on the NYSE and traders of key Nasdaq stocks. . .probably by those in the same brokerage house. A coordinated headfake among more than one brokerage house requires a conspiracy to manipulate. . . something that is known to exist, but nearly impossible to prove. "Blue Horseshoe loves Anacott Steel" [Gordon Gekko from the movie Wall Street] Remember that MSFT and INTC account for a major share of the Dow Jones 30 Industrials, as well as the S&P 100, 500 and the Nasdaq 100 and Nasdaq Composite. . . so an early morning "headfake" on MSFT and INTC and perhaps the S&P futures could drive the entire markets in a direction that is unnatural. . . thus setting up trap for those that buy or sell the fake. . . .and easy money for those that perpetrate the manipulation. . . or headfake. It is easy to win, when you simply know the direction and what to watch for the turn. I believe this to be a daily occurrence. Rande Is PS> My answer assumes the readers knows nothing for the benfit of those that know nothing.