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 : The New Economy and its Winners -- Ignore unavailable to you. Want to Upgrade?

To: Bill Harmond who wrote (5411)	2/24/2001 5:06:00 PM
From: 16yearcycle	Read Replies (5) \| Respond to of 57684

In the ever collapsing market since nasdaq 5200, we have had one very good period, which lasted throughout the summer. We hit a low on 4/14 of 3321 and then after a decent rally, dropped to 15% lower on 5/23. After that there was a powerful move to 4250 and then a pullback and second rally creating a double top at 4250. It appears to me that the drop yesterday which caused a lower low stuck yesterday of 2156, has created a similar pattern to what we dealt with last spring. We are due for a dead cat bounce that either takes us from here up to 2800 immediately, or we will follow the spring pattern perfectly and drop to 1900+, followed by a 33% run to about 2600. It should be noted that on any chart I look at, 1800 to 2000 should pretty much satisfy the wet dreams of every bearish technician. In any case, my feeling is that there is no sense shorting anymore....it looks like there is a maximum of ~10% downside, and values are so compressed and everyone is so short, that huge rallies are occurring quickly. One of them is going to stick.It's not worth the small gains that can be booked. If energy prices become a smaller threat, we will be out of the woods soon. The fed's action WILL work, as long as they can keep easing. I see that off of the 1990 recession, the fed lowered rates to a level where real interest rates were about 0-1% for 4 years. This would mean that AG would be comfortable with a fed funds rate of as low as 3% now, so he has 250 more basis points to work with. It looks to me like only energy can derail this, and I would give it some credibility, but remember the fed had the banking crisis to deal with in the early 1990's and no one thought we would work our way out of that one either. So, off of the low seen yesterday, or off of a low of not quite 1800, I think the next bull market begins. In the 80's and 90's, the nasdaq went up about 10x from its low. Lets expect a high in the next 10 years of about 1800 X 5, which is 9000.That would put the total return on the nas for the decade at only about 8%. It won't satisfy the Japan meltdown theorists, but it's pretty realistic. The risk reward is good now. It sucked last year at 5000 and still wasn't great at 4250. 2150 is another issue. A friend mentioned that we are probably in a similar bind to where we were in 1965 with the dow at 1000. 16 years later we were still at 1000. This sounds grim, but if you bought on the 50% off sales along the way, the old highs were hit in 10 of those years. Would you take nasdaq 5000 next year?

To: Bill Harmond who wrote (5411)	2/24/2001 7:41:06 PM
From: Glenn D. Rudolph	Read Replies (1) \| Respond to of 57684

Geeez I know someone that really likes RIMM:-)

To: Bill Harmond who wrote (5411)	2/24/2001 11:00:34 PM
From: Mark Fowler	Respond to of 57684

Bill thanks i read the article we'll see?? However, i will keep my long trades short term yet. I covered a few short positions on Thursday when ndx hit 1960....a near term rally is due, first resistance approx 2170 thru 2200. We had two bottoming type sticks in last two sessions and Friday's looked like short covering. I don't think it'll be much of a rally, nor do i see a break and hold thur the 50 ma. Bkx's needs to make new highs and hold ( doesn't look like she'll make it this time again) before the Indu can go higher. Most of the major indices are breaking down now. I think the FED needs to cut another 100 basis points and see positive earnings news again to get Compx, Ndx, and others back on track. I don't see what the catalyst is to turn this around yet and more rate cuts are not going to help much near term... it's too far gone.. I'm concerned and there's good chance S&P 500 will take out its long term secular trend. We could see Ndx 1500-1553 and the Q's near 42, their's not much support after ndx 1960, so if she goes it could be a fast drop down. Compx has a PE approx.49 now and S&P 23. From what i since wall street still thinks tech is too expensive for this type of environment. Btw, Neff is short spx. Bill, i'm trying to think positive about the market ( some rays of light) but most indicators are still bearish( declining) on long term secular charts for Ndx,IIX,Compx,Sox,Spx,and others...careful don't get whipsawed . Talk with you later.