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

To: Zeev Hed who wrote (61897)	11/5/2000 7:42:24 PM
From: Stephen M. DeMoss	Respond to of 99985

Zeev, This weeks Barron's has a note from 'Bigtrends.com''s Price Headley. He notes that the 'put/call ratio recently rose above 60%. This has happened on only four prior occasions since 1990 and each marked an important bottom.' Indirectly this ties in with capitulation in that the purchases of large blocks of puts indicates the level of fear and even panic in the market recently. Since we now have the institutions done their large tax related selling, and we are entering a generally favorable time for the market (including the new president's 'honeymoon' period), I think it is reasonable to suggest what we saw in our recent retest of 3100 level as a temporary bottom and a notable form of capitulation. In marking a bottom, we don't have to have extreme oversold and panic selling. As you say, we agree on more than we disagree<G>. Steve D.

To: Zeev Hed who wrote (61897)	11/5/2000 8:02:26 PM
From: Saulamanca	Read Replies (1) \| Respond to of 99985

Zeev, The 21-dma equity put/call ratio recently reached the second highest mark in 10 years with a reading of 0.645. The only other readings above 0.6 in the last decade were 0.69 on 9/18/98 and 0.64 on 10/14/98. ---------------------------------------------------------- As Stephen mentioned from Barrons: Put buyers have been out in force. Price Headley, who runs BigTrends.com, reports that the 10-day CBOE equity put/call ratio recently rose above 60%. This has happened on only four prior occasions since 1990 and each marked an important bottom. In 1991 and 1997, stocks turned up immediately. In 1998, two more months passed before a second signal was issued; then, ignition and lift-off. interactive.wsj.com Despair was in the air.<g> Jim