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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Chris who wrote (8626)	6/6/2001 9:52:01 AM
From: Wayners	Respond to of 52237

I like the FA charts and I think I've looked at them before. You made the comment that AMAT price topped out before orders which is true. My thinking isn't that price of AMAT should top out when orders top out but rather when the rate of growth of those orders starts to slow. Would need another chart made to track the rate of change from one order period to the next to get a good visual on this. This same rate of growth on a charts also works well with Sales growth which I think is superior to tracking earnings growth which is too easily manipulated and adjusted, while you have to have sales growth to even have a chance of maintaining earnings growth. The next problem with tracking either orders rate of change or sales rate of change is HAVING ACCESS TO TIMELY INFORMATION. With Reg FD, a lot of analysts are back to doing "channel checks" whereby they call up a companies suppliers and distributors to find out what the company has been ordering from suppliers and what distributors have been ordering from the company to get the inside scoop on the orders and thus the sales and get a time wise inside information-like leg up on the market. The question is, if I Mr. Joe Schmo starts calling suppliers and distributors and asking what their orders are for the xyz widget aren't they going to tell me to get lost. I have a feeling that the big houses pay for their information in cash or stock.

To: Chris who wrote (8626)	6/7/2001 8:43:44 AM
From: Lee Lichterman III	Respond to of 52237

From Briefing... 08:32 ET Economic Data : Initial jobless claims for the week ending 6/2 rose 13K to 432K, well above the 418K consensus. These data were for the Memorial Day week, which can sometimes create more volatility due to the aggressive seasonal factors surrounding the holiday, but the trend in unemployment is nevertheless up. ========================= I have a few sells on some stuff like MU, CSCO etc. but the main thing that caught my attention tonight was the SOX which formed a Doji. Tomorrow will be important to see if it reverses down from here or negates the formation. Between all the H&S formations, the tweezer top on the DOW and the Doji on the SOX, it would seem that a reversal could be starting sooner than expected. Our indicator is also right at the tops of their channels. Anymore upside in them and they will likely be signalling a hard sell trigger and a change of trend to bearish. If we just pullback from here, then this could just be a minor pullback of "normal" strength. A couple of teh indicators are "peeking" over the tops but I think it is just a slight over shoot and not a hard trigger yet. Nothing imporatant in Highs and lows other than on the NYSE which was repelled by a resistance trendline so the pullback here is probably for real and not a head fake. Basically, I am more bearish short term on the DOW than in tech. We are possibly getting close to some more bearish developments though and the market bears close watching. I was looking at some cycles and realized I could shift one of my mid term cycle lines due to a potential shift in the market. When I did so, it projected a major turn on 13 June which is next Wednesday. This falls in line with many of the other's time lines also so I suspect we are about to make a move in the next couple weeks. Here are the comments from Meyer you mentioned.... "While a recovery along the lines of the consensus forecast is reasonable, I see some downside risks to that outlook. There are no signs yet that the economy is strengthening relative to its first-quarter performance and growth is likely to remain sluggish into the third quarter. In addition, it is unlikely that we will see a repeat of the exceptional performance from 1996 through mid-2000 on the other side of the slowdown. First, the temporary demand and disinflation that accrued during the initial adjustment to an acceleration in productivity--and that contributed to the exceptional performance earlier--may now be behind us. Second, we are unlikely to see a repeat of the unsustainable rise in equity prices or frenzied pace of investment, at least for a time. The events of the past year are likely to linger in the minds of many. "...... ......it appears inevitable that the decline in equity valuations will result in a negative wealth effect; as a result, growth in consumer spending is likely to remain below the pace of increase in income for a while. This will, over time, partially reverse the earlier decline in the saving rate. The other related key will be the degree to which declines in consumer confidence, perhaps under the influence of a softer labor market, undermine consumer spending. ....... the attempt to take advantage of new-economy forces prompted such a frenzy of investment activity that many bad, as well as good, investment decisions were made. ......because the profit opportunities of new technology firms were so difficult to gauge, exuberance took valuations to levels that proved to be unsustainable. ...... ............We could say that the new economy has suffered an old economy disease--if not a full-fledged recession, at least a close relative, a growth recession....... And the under statement of the century award goes for this....."This is a perfect example of an unwinding of a pre-existing imbalance--in this case an unsustainable rise in equity values in the technology sector. " federalreserve.gov Good Luck, Lee