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

To: Zeev Hed who wrote (79218)	6/25/2001 10:44:37 PM
From: t2	Read Replies (1) \| Respond to of 99985

Actually, like you I have a rally starting just before the 4th of July, and yes, my current stance is still 1850 before July 4th, mind you, my "unbelievable" target of 2050 before June expiry, was on the nose and just a day before expiry, yet, we all make mistakes, and have different approaches to the market. Congratulations on getting that call right...I recall somewhere that I praised you for that in one of my posts. Capitulation of Fidelity and Janus? First we really have no proof of that, second, there are more than 5000 other funds, what are they doing ? Is not their capitulation as important as that of Janus and Fidelity, are they capitulating? If they were, the tic would have gone to -1000 and worse for a stretch at a time as they did late in May of last year. These are representations of a change in investor mania for tech stock stocks. Funds funds tend to be more conservative. Did you notice the cash levels at certain large Janus funds. Janus represented the bull market in technology. I read articles on mutual funds buying and selling to get some indication. I saw the Janus article..posted it on MDD..and got extremely bullish after reading it...call it my contrarian indicator. As for wrong in calling 2500. It was just a bit premature, that is all. I just failed to see how old patterns of selloffs ahead of warning season used to happen. We are now in a more normal market....but the heavy short interest is what is going to push the market higher, faster. Here are my reasons or "gut feelings" as you call them. 1. People either expect a retest of lows or a boring market this summer; 2. Large funds (representative of the market) being underinvested in tech; 3. Greenspan still cutting rates...there is a lag in how long it takes to stimulate the economy; 4. Major PC upgrade cycle resulting from Windows XP. It is not just about upgrading the operating system. 5. Michael Dell has been saying that upgrades ahead of Y2K in PC...will result in a new upgrade cycle this winter. PC sector is the biggest component for general health of the semiconductor sector 6. First stages of the move to 3G...initial speeds of 144Kbs..twice the speed of dial up modems being launched at year end by Sprint PCS and Verizon. Huge demand for newer phones according to analysts....finally starts putting demands on broadband. 7. Very high short interest on the Naz..which is my favorite. 8. Cost cutting and layoffs at companies...they are getting leaner. 9. The most beaten up techs stocks in the June quarter will have the most near term bounce..watch for them. They will help the Naz higher. That will prove my mutual fund window dressing theory that I believe is magnified this year as the stocks have sunk so low so fast. Not a normal market. 10. Munder Funds pushing their energy funds this year while they pushed internets early last year. Actually, that is why I am a bit bearish on energy. 11. Best time to buy stocks is ahead of the actual proof of improvements in company businesses. 12. Energy stocks topping out. Energy prices starting to decline...helps stimulate the economy. 13. MSFT appeals court decision could create some bounce. Experts expect a split decision but I expect a slam dunk for Microsoft. I will be watching for Nasdaq 1850 target. As far as I am concerned whether it gets there or not just not change my strategy as long as it gets to 2400 by mid July. It only gives me a better buying opportunity to take a few more chances that I was really planning on. That is the only thing that matters to me. So even if your short term target is right and you say the market rallies after July 4...if it gets to 2400..I don't really care how it does it. By the way, what is your target for the rally off after it hits 1850? I am looking for a mid July target. Like I said, I was impressed with your call for June expiration week and won't mind getting your target for mid July if you have one. I am sticking with my targets after realizing that I made a mistake about a move higher sooner..not recognizing the caution that in preannouncement season and which should be expecially true in the current environment. Good Luck in your trading. Again, I don't mean to offend you and I have not taken offense to your comments. Have just made observations. BTW--Agree that I should not take technical indicators in isolation without considering others but I tend to follow the P/C a bit lately.

To: Zeev Hed who wrote (79218)	6/27/2001 9:33:31 AM
From: t2	Read Replies (1) \| Respond to of 99985

Zeev, Further to my comments about what I believe the big funds are doing and have been doing over the decline. I noted Fidelity and Janus to you already..especially Janus. You mentioned that there are just so many funds out there. I don't know if you watch CNBC but the usual guests that manage money that were so bullish on tech last fall are underweighted the group. The guest host today, Eric Gustaffson who manages a growth fund is light on tech. The other big bulls like Brian Finerty are talking about retest. One can never know exactly what the patterns of the big mutual funds are but one has to take the information from the most bullish investors in technology and look their underweighting or caution as a key indicator. That information isavailable and one can only make a calculated prediction of what funds may be doing...and what that means for stocks. Furthermore, defensive sectors are now showing weakness as well...the growth stocks of the past 6 to 9 months are showing signs of stalling. Oil stocks topping. Profit warnings at what were thought to be good defensive groups. One can take this kinds of factors in making decisions that for some reason you consider "gut calls". That is why I cannot see the Nasdaq at 1850 as you are predicting by next week. IMHO, the market heads higher right into July...and that is my "gut" feel.<g> Sticking to a target of Nasdaq 2400 at least by mid July...but it could get to 2500 in that time. FED decision is a non-factor as well. Nasdaq short interest just hit another record for June.