Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: lurqer who wrote (30696)	2/7/2001 10:32:40 PM
From: Dealer	Respond to of 65232

lurqer! I was just a joshing! I knew he had to be somebody fer ya to post.....I enjoyed it and appreciate ya sharing it with us. I took him at his word and dove in today...... :-) We see???? dealie

To: lurqer who wrote (30696)	2/7/2001 11:04:23 PM
From: captain_midnite	Respond to of 65232

Jerry Favor...!? I was wondering what ever happened to him. I would wait for is weekly CNBC appearance with Insana. I guess he got cut? He did talk a bit quickly, but when I could catch his message I always respected the call. Thanks for the info...CNBC should have him on again, but I suppose he doesn't hype enough. I guess they need more time for phone calls from 12 yr olds and the like... midnite

To: lurqer who wrote (30696)	2/10/2001 12:12:01 PM
From: lurqer	Read Replies (3) \| Respond to of 65232

How low do we go? The query of the weekend. Without prescience, like others I can only surmise. Classic bear theory has three stages of decline: Denial, Fear (anxiety), and Capitulation. Most believe the Denial stage for our current bear was completed by Memorial Day. After some summer relief, the Fear stage began after Labor Day. The market never follows "the script". The "extra wrinkle" in this bear was a danglin' chad. The election "tie" followed immediately by horrendous "tax loss" selling, gave added impetus to Fear stage. Whether on the Naz without that additional impetus we would have broken below say 2950 during the Fear stage is debatable, but now a debate of only academic interest. With the "enhanced" Fear stage, we began the new year in free fall. An unholy trinity of forces had "pulled the plug" on the market and particularly the Naz. First there was fear that by Jan 2,3 had reached panic levels. Secondly the cognoscenti knew there was a serious economic problem. At the time, the "unwashed masses" were unaware that manufacturing in general and tech hardware/infrastructure in particular had "fallen off a cliff". In the companies where orders in mid-December had simply ceased, this knowledge existed. Action based on that economic knowledge (coupled with the Fed's "we'll address the problem when we get 'round to it" attitude expressed in their December meeting) was a component of the downward pressure exerted on the market. The third propellent downward was margin selling. After penetrating the lows set in the spring Denial stage significant margin calls were being induced by the beginning of '01. Then on Jan 3rd we had the latest example of the "Greenspan put". After our January rally, we have in little over a week into February declined to where we began the year. So what now? The liquidity provided by massive Fed repos and the credit effects of both the interest rate cuts already made and those to come, have provided a floor under the market. The question is - where is that floor? We will get our first indication of that floor location by where the market elevator goes this month. That may be as soon as next week, but other than an early dip, I doubt it. As I mentioned in a post on another thread yesterday it's highly unlikely that Greenspan's congressional testimony next week will be anything but bullish for the market. While many may question the efficacy of Max-Pain for a particular stock, when the M-P values are lopsidedly skewed for most stocks, the predictive power of the tool increases and is now decidedly bullish. Moreover the bullish complacent sentiment values have decreased. Perhaps not enough to signal a "bottom", but sufficiently to allow a mild relief. So if (and in the prediction business, there's always an if) we rally next week what about the following week? Usually following an "up" expirations week, we "give some back". How much? And do we "blow through" the January lows? Well 'course I have no way of knowing, but at this juncture I don't believe so. Could be wrong and the market certainly can "make monkeys of all of us". Now I'm not counting on the appeals court giving strong indications they'll reverse Judge Jackson's Microsoft "Findings of Fact", but that would give the market a boost. Rather I'm currently "of a mind" that the Fear stage terminated (was aborted?) at the beginning of January. If so, it's a little early for the Capitulation stage. I see that a number of SI seers are calling for a low 'round the beginning of March - based on a variety of reasons from Astrology to 50 day S&P cycles. They "could be right". <gg> My own views differ. I not only don't believe we'll breach the January lows in the next several weeks, but we may have a rally. Mind you nothing outside of a range bound market. Fear and greed will oscillate in dominance. Euphoria that "the Fed will save us" and the "worst is over" will alternate with the despair of "we're beyond redemption" and "this will never end". So I see a choppy market without an immediate breech of the January lows. That in no way means we're "out of the woods". Even with additional Fed easing in March, the key will be the "forward guidance" given in the cc's starting in April. If "doom and gloom" for the second half prevail you will definitely see Capitulation with a capital C. Just some thoughts on a Saturday morning (or afternoon depending on location). All on a FWIW basis, and certainly JMHO. lurqer