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

To: Zeev Hed who wrote (80945)	7/28/2001 9:46:20 PM
From: iod_sherwood	Read Replies (1) \| Respond to of 99985

I just had to share this... markpoyser.com

To: Zeev Hed who wrote (80945)	7/28/2001 10:47:50 PM
From: Mike M	Respond to of 99985

In any event, the most important element in your chart, IMTO, is the declining volume, an old Wall Street adage should be heeded: "prices follow volume". There is another axiom, "never sell a dull market short." Actually, I believe that declining volume in a correction is considered bullish. By Tuesday or Wednesday we should have a pretty good idea how serious this rally is.

To: Zeev Hed who wrote (80945)	7/28/2001 11:39:44 PM
From: mishedlo	Read Replies (1) \| Respond to of 99985

Another interesting point. If Price follows volume, why did VRSN close up less than one point on that opening gap up on Friday on over double average volume. Same question for QCOM. If they really wanted to buy VRSN or QCOM I think they would have hammered QCOM on news of 20% lowered earnings or whatever it was. Instead it gaps up and goes nowhere on 1.5 times normal volume. GOT DISTRIBUTION here? That is what I smell and smell big. HGSI is another one. It will be fun to watch this flying POS crack 40. Hopefully it will bring 20 in a hurry. M M

To: Zeev Hed who wrote (80945)	7/29/2001 11:04:07 AM
From: KymarFye	Read Replies (1) \| Respond to of 99985

As you probably know, declining volume is a classic component of formations like the falling wedge. As you've also acknowledged, the adage about price following volume can be taken in different ways, and at extreme points can turn into its opposite. In the falling wedge, price follows volume in one sense - as declining price follows declining volume - but also in a more abstract sense, in that volume is decreasingly giving its stamp of approval to the overall down move, leading price to follow the implications with an eventual upward thrust (often explosive, probably accompanied by sharply increasing volume). The false breakdowns may occur in part simply because low volume/narrow range markets are susceptible to strong moves of either type. Seems to me that a falling wedge is rather appropriate to the current economic situation and context of sentiment. On its own it implies a Summer rally of only around 15% from current levels, still leaving the Nasdaq in the red for the year. To me, it still seems far too early to be talking about moves to the high 2000s or higher.