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

To: bobby beara who wrote (76924)	5/13/2001 12:21:17 PM
From: eichler	Read Replies (1) \| Respond to of 99985

bobby, Thanks for those charts. Compx looks like it's breaking down with those latest black candles, but as you point out on declining volume, so not much conviction in the move so far. VIX looks ready to rock, seems a break upwards would be most likely...a warning flag for longs. This week and Tuesday's reaction should be most interesting. Regards, Eichler

To: bobby beara who wrote (76924)	5/13/2001 2:06:39 PM
From: t2	Read Replies (2) \| Respond to of 99985

volume on nas friday, third lowest of last three months. vix coiled, ready to move the pattern on the dow, looks like a rising wedge, the pattern on the nasdaq looks like a bull flag, the spx is a tweener. BB, Are you turning bullish again? What I find really interesting is that the "overbought" condition has disappeared. May not be a big deal but seems to right in the last few weeks...as in this chart. clearstation.com To me, that Nasdaq looks set to start a major move with 1 or 2 days but lasting at least about 2 weeks...at least to the end of May 25. The first move on the Nasdaq from the lows to about 2200 lasted about 2 to 2 1/2 weeks. Which index looks better to you. I am picking the Naz. I still don't get the significance of the VIX. Has not been much of a predictor except when it reached high levels in early April along with the VXN. The volume being low is a great indicator most times. More importantly is that the Naz stopped going down in bigger percentages during periods of light volume. A 40 to 60 drop on Friday would have been a bad sign even if volume is light. To me the fact that many traders seem to expect a sell on the interest rate cut is a reason to believe we will be heading higher after the cut. A 25bp cut would also be bullish as it would point to recovery gaining steam in the economy....call it "FED Confidence"..and that has to translate to consumer confidence later as well. The only bearish scenario I see out of the FED is a 75bp cut. That would indicate a lack of confidence in the economy. IMHO, 25bp would be ideal along with a strong statement on future rate cut possibilities.