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Pastimes : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?

To: yard_man who wrote (115451)	8/3/2001 10:10:23 AM
From: marginmike	Respond to of 436258

HOpe so Gold stocks getting the old "in out in out"(Clockwork orange)

To: yard_man who wrote (115451)	8/3/2001 10:14:34 AM
From: ild	Read Replies (2) \| Respond to of 436258

Bottoms Up, but Hold the Bubbly By Bill Meehan Special to TheStreet.com 8/3/01 8:29 AM ET URL: thestreet.com The penchant for calling a bottom is back in fashion again on Wall Street. Miserly economic data be damned, Merrill Lynch's Joe Osha says the chips are down (or were down, given the Philadelphia Stock Exchange Semiconductor Index's 20%-plus gain in a week) but the worst is over. Another analyst states, "The train has left the station." Clearly, chip stocks have been running on the express track, but the fundamental case for the move appears a little flimsy. Oh, and Intel CEO Craig Barrett gave the "all clear" signal Thursday, so I guess it must be so. Never mind that the chip giant has seen better times just around the corner for about a year. Drink up the heady brew of what might be, and disregard Friday morning's Dataquest forecast for the PC business in Europe. Friday morning, of course, all eyes will be focused on the employment report, but the National Association of Purchasing Management's services report shouldn't be overlooked. That report takes on greater importance these days, as signs that the recession in the manufacturing side of the economy has spread into the service sector won't bode well for those expecting a recovery anytime soon. Last month's report moved back above the 50 level to 52.1, but it's expected to decline, although consensus is still north of 50, which marks expansion. Sizzling SOX From a technical perspective, the bullish case appears compelling. The SOX and Nasdaq 100 handily took out resistance, although it took a late-day rally to end Thursday's session with modest gains. However, while breaking through resistance was a sign for traders to play the techs from the long side, those with a longer-term time frame should wait for a less crowded train running on more stable rails. There's always another train, and if this move is the real deal, there's no reason for investors to be in a tizzy over not having jumped aboard a careening express. Thursday's 3% advance pushed the SOX just through its 200-day simple moving average, but the 650-660 area might be tough to get through in the very near term, given the magnitude of this move in such a short period of time. Increasingly bullish sentiment also appears to be a formidable obstacle. I don't have access to the weekly Investor's Intelligence poll right now, but I did see that Market Vane's weekly poll among futures traders saw a bullish reading of 42%. While hardly alarming, it's been hovering around the 30% level for some time, and the Chicago Board Options Exchange put/call ratio has also been slipping. Anecdotal evidence, in the form of CNBC, also indicated that more than a few strategists have also become more "constructive." Across the Pond The surprise rate cut by the Bank of England also played an important role in Thursday morning's strength, although the European Central Bank left rates unchanged. And with the most recent economic data showing continued weakness, it's a virtual lock that the Fed will cut again two weeks from Tuesday, and traders have become increasingly optimistic that there will be another cut in October. With the market being powered by anticipation of an economic recovery, it's unlikely that weaker-than-expected data will be met with glee. The Fed is far from irrelevant, but its power to influence capital spending has been diminished by a strong disintermediation trend and the nature of this economic slowdown. TGIF, as every muscle in my body is aching from the always-thrilling chore of packing and unpacking of an untold number of boxes. Having been a bit out of touch with the market since Monday, I'll also take a look at my indicators and charts, which I believe will undoubtedly look more bullish in the short term. That said, however, it's probably still too early for investors to break out the champagne. Lift a glass to the weekend break, but patience, particularly when it comes to the tech sector, is still very much warranted by longer-term investors. Bottoms up!