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Strategies & Market Trends : Drillbits & Bottlerockets -- Ignore unavailable to you. Want to Upgrade?

To: Jorj X Mckie who wrote (5789)	3/20/2001 12:19:13 PM
From: Lost1	Respond to of 15481

cranking up some Dinosaur Jr in anticipation of....LOUD

To: Jorj X Mckie who wrote (5789)	3/20/2001 1:57:52 PM
From: Rich1	Read Replies (1) \| Respond to of 15481

Just got back from a Brian Tracy seminar he is very good.. Talked about "If OnlY"...<g> Todays Big Report from DWA had this which I found pretty interesting: Hope they don't mind me psoting it... Chicken Little's Revenge and Perspective Your Customers Might Understand One Thing we do know is that most of the mainstream media has created hysteria with the investing public. I even saw in the New York Times the other day where a group of people said they think the government should not give individuals their own Social Security account to invest because they think the government could do it better. I thought "Oh My God" what has this come to. We have to be at maximum hysteria when anyone, and I mean anyone, could possible think that the government could do a better job of investing money than the individual himself. Considering all the hype and major magazine covers suggesting we are in a terrible bear market that will last for who knows how long, we thought it might be worthwhile to gain a little perspective on where we have been and where we might be going. What I find interesting about this market is how the NYSE has been relatively unhurt by the crash in the tech stocks. This tech/wreck has been confined to just that, technology. The NYSE only has 10% of the stocks underlying it in technology. When you look at market bottoms the bell curve distribution isn't giving us a picture of that at all. It is giving us a picture of a very normal market. Look at the progression of the sector distribution from December 27, 2000 through March 14, 2001. You will see a move from oversold in December to perfectly normal at present. What you also see in the March 14 curve is a disconnect between technology and interest rate sensitive issues. History suggests we are likely to see those that are too far to the left move back to the right and those that are too far to the right move back to the left. I think it will help for you to see in progression how this market has unfolded this year according to the 7200 stocks we follow that are split up into 42 sectors. This group includes the NASDAQ stocks too. So when we look at the bell-sector bullish percent distribution we see that the overall market from December rallied up through January with the Tech stocks doing the best. You can actually see the market moving to an overbought condition in early February with the majority of sectors residing on the right side of the curve. Early February the OTC Bullish Percent went to Defense and the shift began in earnest. The sectors heavy in tech and OTC shifted from overbought to oversold in short order. Now what happened during the January period was just that, "The January Effect". The majority of carnage was done from March 2000 where we went defensive on the OTC to the bottom in July. The NASDAQ was down 51% during that period. Many of the larger cap tech issues like SUNW made a n ew high in the August-September period with the exception of CSCO. Year-end tax selling probably caused the next wave of selling from September through December and the January effect caused the rise in OTC during January. I remember on CNBC December 28, I said we were on defense as far as the OTC universe in general but I will put up as a trading recommendation XLNX. It did very well and exactly what I had hoped for during January. By February on my next appearance on the night show the stock had collapsed. Naturally I get credited for the loss when it did what I suggested it would do in the January tax bounce syndrome. Point is XLNX was no different from the rest of the tech stocks. It bounced in January and collapsed thereafter. So Waz up now? Notice in how the tech issues have disjointed themselves from the rest of the pack and are bringing up the bottom. Also notice how the interest rate sensitive issues have disjointed themselves from the pack on the upside. My guess is we will see a change in places for each of these groups of stocks. Yes, I think we will get a tradeable tech rally and that the interest rate sensitive issues have run their course. IN ALL, when you look at the aggregate of all the sectors, we have a very NORMAL market with the majority of sectors in the center with some too high and some too low. This might help your customers understand what is happening. The real problem here is everyone is still standing at the tech door that closed many months ago. If things were as bas as CNBC would suggest we would see all the sectors huddled on the left side. As it turns out, and the media doesn't want to face it, there are stocks that have done very well in this market causing many sectors to hold up well. The only problem is everyone has their boat overloaded with tech issues. With the NASDAQ knocking at the door of the 100% oversold level of the bell curve we think a good rally could be in the near future. Add in last weeks Triple Witching, which in my opinion was mathematically driven and nothing else, we stand to see an unwinding of the expiration pressures this week.