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

To: American Spirit who wrote (56629)	7/15/2000 12:32:23 PM
From: John T.	Read Replies (3) \| Respond to of 99985

American Spirit, I'm glad that you didn't get upset by my prior message to you. I wasn't criticizing you; just ribbing you a little about your timing. Your opinions are just as good as mine (and probably better). If you read my old messages you'll see that I was short term bullish from about July 6 up until Thursday, July 13. I was so bullish that I told the people on the Stock Attack thread that there were so many bullish setups that it was like "shooting fish in a barrel." Of course, this comment drew ire like a lightening rod attracts lightening. Anyway, I had many good trades on the long side, but I sold everything and went flat on the afternoon of July 13. In hindsight, I went flat at least one day early. I've now initiated a small short position, because I'm short term bearish. If the market continues to rally, I'll close my short quickly. In your last message, you stated: The problem with many on this thread is that they are convinced there's a bear market going on when in fact it's inaccurate to call it that. We certainly had a bear market in the NASDAQ Composite. It was down 40% from its all time highs. Some people believe that the bear market is finished and others believe that it is just getting started. I believe that this issue will be resolved soon. Its all a matter of opinion. For instance, a lot of Elliott Wave practitioners believe that the market has much more downside. Under Elliott Wave principles the market advances in five waves (Waves 1, 2, 3, 4, & 5) and corrects or moves down in three waves (Waves A, B & C). Here's a chart that illustrates these principles: home.swbell.net Now, look at the right half of this chart -- the Corrective side. Notice that there is a large downward [A], [B], [C] corrective wave. After the market peaked, we entered this corrective wave. Here's where the real difference of opinion surfaces. Some people feel that the market has already traced out the entire [A], [B], [C] correction and that the bull market is back (upward movement in impulse mode or 1, 2, 3, 4, 5 waves). Others do not share this opinion. Robert Prechter (http://www.elliottwave.com/index.htm ) has a different, more bearish view. I believe Prechter is saying that the market is in corrective mode and that it is now approaching the top of wave (2) on its way down to wave [A]. In Prechter's view, the market has much more downside. In fact, Prechter is calling for a major stock market low in 2003-2004. I don't know where the market is in the overall scheme of things. However, I do believe that on a short term basis the market is at or near the end of a 5 wave rally and that a correction of some degree is imminent. Again, here's my chart of the SPX: home.swbell.net The question is: Will this be a brief correction followed by a renewed rally or will it take out the May, 2000 low?