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

To: Robert New who wrote (75638)	4/21/2001 2:34:17 PM
From: t2	Respond to of 99985

Did sell a couple of positions into strength on Friday but continue to hold most of my long positions. Some stocks are up 3x where they were just 2 weeks ago...e.g. emlx et.al. Continue to favor storage and software. Still think the risk/reward is to the upside and if we do get a pullback next week on 2.2 billion shares or less (hopefully less) then I will be adding to/initiating positions. Next week should be quite telling as to the sustainability of the most recent gains. Watch that volume! Robert, Making some sales was a good idea. I sold some positions but added some too--depending upon whether there is some short term catalyst---mostly Nasdaq names. Took the opportunity to re-position my longs. I am still expecting a big move up in the market. Feel that options expiration had a lot to do with keeping the Nasdaq at the level it closed. As Tod H. on stated on the street.com....the QQQs were pinned to 48. Trading very close to that level for the last 4 hours (plus or minus a bit on either side of 48) As a result, we have a lot of shorts and a lot of long traders in the Nasdaq stocks...after the expiration of the options. My feeling is that the longs are feeling a lot more comfortable than the shorts (referring only to the traders). To me that means Monday should be good for the bulls. So many are saying this is too fast, too soon, and are turning short term bearish...and of course short term really refers to the active traders. My feeling is that this the reason (skepticism) the market goes higher at a good pace. Even the optical and communication chip sector came to life due to some more neutral to bullish comments on business conditions for companies like PMCS and also some upgrades by the brokers of optical/communication semis. My feeling is that the short sellers in optical stocks were the most comfortable...jdsu had not moved much but Friday started to make gains. PC sector may be recovering. Feel that MSFT upgrade on Friday by Sherlund of Goldman Sachs was important and the stock goes higher but was held back due to expiration.....represents 10% of the QQQs. Factor that in with a recovering PC sector and there is good reason for a lot of optimism. Back to the reason that people say the Nasdaq should pause--- consolodate the gains. I don't believe it will happen that way. Momentum, whether it is to the upside or downside...is still momentum. It is hard to stop....and we are in a momentum market (for now), IMHO. I realize people don't like the word "momentum" but it was proved going up and coming down. There seems to be no reason for it to change now...at least until it hits a range somewhere near the middle of the lows and highs of the last 52weeks (away from either extreme). Monday will be very interesting. BTW--Also think that those mutual funds that got out of the high growth tech have been making their move back in and will continue to do so for a while.