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

To: Crimson Ghost who wrote (68874)	2/10/2001 9:41:55 AM
From: Zeev Hed	Read Replies (1) \| Respond to of 99985

George, I think we disagree on this, at least for this year. I have a bottom at 9600 or so (and if this does not hold, possibly another 400 points down to 9200) and a top just under 11500. The next tightening cycle of the Fed (I know, no one see the Fed's starting to reign in, yet but tightening follow loosening just as night follows day) probably mid to late 2002 will initiate a bear market that will affect the Dow stocks more profoundly. I think that this year, the market (wrongly, IMHO), view the Dow stocks as a substitute to bonds and every weakness in the techs moves money to the Dow getting their relative valuations out of whack with historical norms. As for timing and how far will the Dow go in 2002 before reckoning sets in,I do not have good visibility yet, my problem is that I do not know what changes in taxation will be implemented, and whether Asia can get out of its morasses without a very hard landing. If we get into another Asian contagion, they will not be able to rely on good Uncle Sam to bail them out like we did in 1998, our trade balance is already running at an atrocious 4% of GDP (legacy of our Asian bail out in 1998), and that is not sustainable, an surely does not have room for further expansion, IMTO. Zeev