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

To: American Spirit who wrote (79689)	7/8/2001 3:29:50 AM
From: iod_sherwood	Read Replies (2) \| Respond to of 99985

you may want to revisit some of that... i gave an old example to my own readers back earlier in the year... explained the whole PMCS debacle... at a 25% annual growth rate, which they've basically declined now, it would take around 3 years before revenue levels return to year 2000. in absolute terms, that in itself would be a tremendous achievement. too many players out there. All the bulls are still living in the market of the past. That's why you just figure that things can pick up and get back to where they were. To do a proper and full correction, which we're enroute and have been in for, thigns get dragged out and take a lot of time to scrape/bottom out as you allude... There are still plenty of valid shorts out there... from things like SEBL MERQ to LLTC even something like CRUS is in trouble, technically. It's still very much a supply/demand game. The demand is far too insecure, there is no confidence from any analyst or investor... anything you hear/see in the media is "put on a brave face" - long term you're fine right!? A very likely scenario is we retest lows on the Nasdaq and then become relegated to a 200pt trading range for the rest of the year. Ever remember when JDSU/SDLI was the rage??? PR every day, hype in the media everyday... where is it now? Things like JNPR are going that way... certainly even something like SEBL could get that bad... No despair yet... stage 3... when the media's in despair... the bear will be nearly over ;)

To: American Spirit who wrote (79689)	7/8/2001 11:26:51 AM
From: mishedlo	Respond to of 99985

Several signs of encouragement for the shorts are as follows 1) There is not that much gloating going on on the bear boards 2) EMC and AMD really really took the wind out of the 2nd half recovery nonsense 3) VIX and VXN low (but more importantly headed in the right direction) 4) Everyone counting on a great earnings run when I can not figure out why. Earnings will suck across the board and that you can book. Will they be bought like April? Well In April we had the 2nd half recovery lie and a surprise rate cut to keep us going as well as stocks that were hugely oversold (like 1 1/2 monts of oversold). Far far different conditions now. 5) The bears were covering on some threads. Signs of fear by some big bears with all this complacancy by the longs is not a very good sign for the longs. 7) Although TRIN watchers have been calling for rallies, TICK counts never have gotten excessive. We did hit -871 on Friday and perhaps that is good for a small bounce on Monday but that is about it with all the complacency out there. 8) Window dressing may have used up a lot of that "sideline cash" that I keep hearing about. Will there be a rally? Of course there will be rallies. The half-loaf theory says cover at 1850 and let someone else have the rest. Of course if that is everyone's plan we never get there cause everyone will start cheating 10, 20, 30 points in front of that and we only fall to 1860. But how big will that bounce be at 1850 anyway? That depends on HOW we get there. Will it be slow grinding (in which case we get a small relief rally) or will we see some -1000 TICK count days (like several of them in a row). The more fear the higher the bounce. It is as simple as that. We rallied strong in April on something other than strong fear (for other reasons). Those other reasons are now missing IMHO. Recoveries build slow. All this talk of a fast recovery is pure BS.