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

To: t2 who wrote (77756)	6/1/2001 11:13:37 PM
From: Berney	Read Replies (1) \| Respond to of 99985

NV, Looks like an Old Vision to me. In my Phleet, I don't short and I don't use margin. However, I do try to assume some rational reason for my actions. I'm an FA dude at heart, but a TA dude by brutal experience. My little Phleet is up some 24% YTD, but I'm still down some 12% since last September, after deciding to make some B&H decisions. The SnP is down 17% so I probably, despite CNBC's constant remarks about how far we off the 4/4 lows, should feel pretty good. I think that you, as AS before you, are going to have to invest in a TA book. Scott of SUNW is an absolutely great CEO, and what he said is: 1) I don't have a clue about this quarter, 2) I don't have a clue about next quarter, and 3) I'll let all you FA and TA types take a stab at it (i.e., I've got enough class action suits pending). Just a View from the Swamp Berney

To: t2 who wrote (77756)	6/1/2001 11:32:29 PM
From: Zeev Hed	Read Replies (2) \| Respond to of 99985

NV, let me take a crack at it without technical analysis. The S&P at a PE of 25 is almost twice the long historical norm of 14. If indeed we are "coming out of a bear market", it should have dipped at least under the norm. Thus, maybe the bear's work is not yet done. The QQQ, or NDX, even if yo assume that next years earnings are going to be 30% higher than 2001 (which will by itself be disastrous) is sporting a PE in excess of 50 of those future not so sure earnings. Long term interest rates are going up, providing stiff competition for equities that pay no dividends. The Dow just recently was within shouting distance of it all time high. Since April 1999 it has been in a range of 10,000 to 11500, with two minor excursions under that range and a minor excursion above that range. The March decline to 9100 never "satisfied' the "demand" of a bear market definition, if indeed we are coming out of a bear market, how come the Dow never had one? Maybe it is still coming? The feds have already lowered short term rates by 2.5%, they may have only two such additional bullets in the barrel, what happen if they are pushing on a string, like the BOJ? More than 80% (I have heard even higher numbers) of the laid optical cables are "dark", apart of some metropolitan deployment of optical devices, maybe there is not much need for more of the same, particularly that the small telco have run out of money and thus there is no longer any urgency on the part of the large established telco to rush up or lose market share. Japan just reported a negative growth in its GDP, are other Asian economies like Korea and Taiwan far behind? Europe, according to SUNW is slowing as well. Is it possible that while the US stays out of a real recession (this year) the rest of the world is slowly sliding into one? In the semiconductor arena, we hear that companies in Taiwan operate now at between 30% to 50% capacity. Since these are the suppliers to all our "fabless companies" could it be that the fabless sales are going to be down that much? Can you expect doubling of the current sales rate of chips in the next 12 months? That is what it should take to absorb excess capacity in the sector. None of these are technical indicators, and frankly, when we bottom (IMTO, sometime later this year, probably in August), most of these elements will still be in place, so what will be the difference? The fact that sellers will be exhausted and selling pressure subside. This will be reflected of course in lower prices for equities, bringing at least some of these parameters more in line (lower prices will mean better valuation measures). So How do we now when to jump in? I doubt anyone knows for sure, but technical indicators help in determining if seller exhaustion has occurred, if there is enough money on the sidelines to sustain a new Bull market, or if we are simply going to stay in a wide trading range for years to come. We already have two years under the belt in the Dow... Zeev

To: t2 who wrote (77756)	6/2/2001 6:57:08 PM
From: The Freep	Respond to of 99985

NV -- first of all, LOL on the "thanks for responding" comment. Secondly, here's someone who agrees with you on the Oracle front. . . thestreet.com Finally, <<Forget Monday/Tuesday--I take that back. One or two day predictions don't really make sense unless one is daytrading or if it is a trend developing. I am just saying that in 3 weeks we should be much higher on the Nasdaq.>> My quibbles with your posts aren't about your calls for market directions. It's simply that you attempt to explain every move on a daily basis with statements that often make no sense. You're too smart to make the type of statement I picked on this last time, as if the Naz moves based ONLY on one event. On the day after the worst Book To Bill in 10 years, you blamed the decline in the Naz on Jeffords not having his press conference, somehow ignoring the fact that the SOXX declined 6%, as if that was only because of Jeffords? The truth is that on a day to day basis, it's often impossible to know what moved the market (though on that particular day, the SOXX reaction to the news may actually have been the cause). Think of the day after the last rate cut. Was the huge rally a delayed reaction? Was it, as John Cuedele said, due to a Fed repo (even though similar injections this week didn't cause the same response)? Or was it any of the other 10 things we saw in print that day? Blanket statements are silly and weaken the arguments that they attempt to support. As to what methods I use, that's beside the point. I am not the one posting absolutes. My guess is that it's more likely that we'll the Naz lower than 2000 before we see 2500. Why? The usual reasons proffered around here: earnings are depressed so PEs are high; energy prices hurt; Europe and Asia perhaps being problems; etc. But I agree with some of your points, too. The money supply increase is bullish. Fed rate cuts are bullish, though there are arguments about why they won't address the current problems. Tax cut? Bullish. And I also believe that tech growth will resume at some point (which is bullish) but I don't know when that'll happen (and neither do the CEOs of high tech companies who, I dare say, know better than you and I). So call me a mild bear, but far from a doomsday kinda guy. How about this? I think that by the end of October, I'm gonna have better buy in points on the stocks I want to own for the long/intermediate term. I'll wait -- whether it's in June or October. The difference between us, I guess, is that I won't pretend that I can look at the market and say, well, if there's no war in the Middle East, we'll be up the next 2 days and 20% higher in three weeks. If you have that type of clarity, you'd be so rich by now we'd all know your name. (Wait. . . are you Warren Buffett???) Look, you might be right about market direction. That's never been anything I've picked on you about. I'm happy when people on SI make money. Honest. It's simply that you state things as absolutes and spin everything to back up your point, often ignoring facts that don't work with your interpretation. There's grey areas all around, and you won't admit to them. And that makes discussions with you very, very, very challenging. I think we've cluttered up the thread enough with this, so I'll leave you the last word if you want it. :-) the freep