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

To: American Spirit who wrote (76869)	5/11/2001 2:37:30 PM
From: t2	Respond to of 99985

A.S., I am not dismissing the possibility of a short covering rally today and Monday. To me it really does not matter much since the trades that I am placing are for a higher Naz close than it is right now. To get the gains earlier would be a bonus! The light volume and lack of a major move also suggests there is waiting among institutional buyers for better prices....or until the FED decision is out of way...which is a strange way to look at it, IMHO. The light volume also suggests that the shorts are not able to push this stock down much even though the technicals are supporting their case. Their bets have already been made as well...they are in the waiting game also. That is why a rally after the cut is in the bag, IMHO. Like I stated earlier, I will take it even if it happens before the Tuesday. However, my gut feeling is that we rally starting Tuesday...and drift slightly lower in the meantime.

To: American Spirit who wrote (76869)	5/11/2001 4:31:20 PM
From: t2	Read Replies (1) \| Respond to of 99985

So far everything seems to be on track on the Nasdaq. We drifted lower today as I was expecting. At this point, I am expecting some weakness Monday as well....followed by a kaboom!! A big move up Tuesday to Friday. All this goes contrary to the buy the rumor, sell the news...approach that traders normally take. This one should be an exception as it will be a sell the rumor (like we saw today) and buy the news..after and on the day of the FED cut. The FED cut will surprise some traders (50bps). Like I stated earlier, it is my belief that too many traders are expecting a sell off after the rate cut and positioned themselves for that during these light volume days (supported by strong technicals that point lower). They will be covering at higher levels, if they wait until Tuesday or later, IMHO. A weak market today and Monday supports my thesis. That is why I am actually hoping for a bit of a pullback Monday.