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Strategies & Market Trends : Stock Attack -- A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: eichler who wrote (32616)	10/11/2000 7:48:12 PM
From: Galirayo	Read Replies (1) \| Respond to of 42787

Capitulation ... who says we need it? And Why? And What will be the determining factor of Qualification of Capitulation? Is this a Bear or not? Still looks to me like it's a violation of the Long Term UP Linear Regression Channel .. 3 year time frame. If it's a Fib retrace ... no Capitulation is needed. It looks like the NAZ did the Capitulation thing already. I don't see how we need to go any further south. Under valued issues will hold up the market while the over valued get crushed. I think we are almost there if we have not arrived today. I would Guess Very Few are on Margin today. I would not even consider it. Most won't after the April - May Trashing. I'm sure that taught some a new lesson ... let's hope they remember till we get a "real rally"! Ray

To: eichler who wrote (32616)	10/11/2000 10:11:40 PM
From: Dan Duchardt	Read Replies (2) \| Respond to of 42787

Eichler, At that point, I will be agreeing with you that the probability for further declines will diminish greatly. I'm not arguing that the probability for further decline has diminished greatly. What I have argued is that it does not have to happen so suddenly that it spikes the VIX the way it has on a few occasions in the past before the bottom is put in. At this point the bottom, wherever we may find it, is a lot closer than it was on September 1. I will have to agree at this point that a spike is becoming more likely than it was a few days ago, especially since VIX made a fair spike already today. If COMPX breaks the May low here it could precipitate a fast sell off. I will never say it cannot happen. However, it is interesting to note the lowest COMPX close of the year (3164.5) was broken today, and then we closed 4 points above that level. OEX (the basis of VIX) made a new low for the year today, and then climbed over 1%. Today was a very grim looking day in many ways, and was as good a day as any for the major dump, but it didn't happen. When all is said and done, it was not nearly as bad as some days back in the spring when COMPX was routinely swinging over 5% a day. On April 4th for example, the $compx had a range of 3649-4283. The high the day before was 4572. Now that's fear. Indeed it is. The kind of fear generated by knowing that the COMPX had gone up way too far, way too fast to sustain those levels. We can still make rational arguments that COMPX is too high, but it's getting harder every day to argue that there are no sound buying opportunities. Yes there are people who will throw in the towel, but I dare say there are also many getting ready to absorb some cheap stock. A good hard 400 point drop off the cliff from here would do the trick, IMO. Looking at the weekly chart for COMPX, from the 98 lows where the the big bull started running to the highs of this year, the 62% retrace would fall somewhere around 2700-2800. Just about right. Yes, but it will also be a nearly 100% retrace from the Oct '99 low, and it will have to blow out a lot of natural support from the congestion of highs around 2900 prior to that low. All of that could happen, but it could very well happen with a continued steady decline over several days instead of a blowout. I'm not trying to convince anybody that VIX cannot spike to 40 or 50 or higher. The point is only that it does not have to for the trend to turn. If we get a higher high here for a day or two, and VIX starts to pull back, I'm not going to be sitting here saying this can't be the bottom because it didn't look like one. Dan