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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA -- Ignore unavailable to you. Want to Upgrade?

To: marginmike who wrote (4075)	8/4/2000 12:54:07 PM
From: macavity	Read Replies (2) \| Respond to of 19219

OT: A law of three. I have always found that my trades have worked best when I have stuck to the following law of three. 1) Fundamental idea that there is a shift in the balance of supply and demand. 2) Technical anticipation / suggestion of this balance shift.(e.g. divergence, accumulation / distribution) 3) Technical confirmation of the event and price follow-through in the expected direction. (trendline break etc.etc) Normally I lack the patience to wait for all three, but my odds do shift accordingly, and I am returning as the prodigal son to my roots. The idea that I am looking at is the Aug2000 lock-ups. These are the lockups that we have now arrived at from the Feb2000 IPO's. ipolockup.com There is potentially one hell of a lot of stock coming onto the market during this month. As this stock starts getting put out there all that money gets absorbed and price (the index levels) go down. This is why I am sounding like a broken record about NDX 3630 and all my bearish trend signals kicking in. - this is (2). If this level does not hold, or rather 3750 is not broken, the path of least resistance has to be down. It is simply a matter of liquidity the amount of stock relative to the amount of cash. For this month we have a flood of lockups. I have not even included any idea of IPO's or secondaries. Greenspan can move rates where he likes I just know that there will be insiders now legally able to shift their stock. If we consider that a typical IPO offers 20% of stock and during february we had ~ 25Bn of IPOs then that makes 100Bn of stock that can now be sold. Mutual Fund flows at best are 5-6Bn a week. There is no guarantee that the insiders will sell as most of the stocks have been slammed over the last months, but most of these guys bought / received their stock at 0.00 USD. The fly in the ointment - the USD. It is on the rampage. Someone in europe / asia is buying US assets - (not just Deutsche Telecom) yes if they want to buy stocks then I agree this market will have some support. My hope is that they are buying Treasuries instead as there is no Govt security in the world (G7) that is yielding 6% at 30 years. (1)& (2) I believe to now be in place. I am awaiting (3)! - macavity