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Strategies & Market Trends : Guidance and Visibility -- Ignore unavailable to you. Want to Upgrade?

To: Jerry Olson who wrote (12689)	8/28/2001 1:03:36 PM
From: 2MAR$	Read Replies (1) \| Respond to of 208838

What's this --->TECHNICALLY SPEAKING: Nasdaq Ready For A Summer Rally ?? By Karen Talley Of DOW JONES NEWSWIRES NEW YORK (Dow Jones)--Softer consumer sentiment is sending stocks lower. But the slide may just be a pullback before stocks resume advances, technical analysts say. The Nasdaq Composite Index is a "coiled spring," ready to move forward, says Richard Suttmeier, chief technical analyst at Joseph Stevens. Suttmeier's assertion is hardly the only statement by a technical analyst that the market is on the verge of a long-awaited summer rally. Any advance may be choppy, although that would be nothing new considering recent market action. Friday saw a stout advance and Monday followed with a slight decline. Tuesday is seeing considerable selling after the market was jarred by a consumer confidence index that fell to 114.3 in August, down from 116.3 in July, as more people fear for their jobs. But all may not be lost if the selling tapers off. Of course, technicians' time frames for a rally are varied, ranging from "blink and you may miss it" to several weeks. And they say it could be followed by another bout of selling. LOL But after a summer of false starts, the prospect of something coming together is alluring. Suttmeier uses a coiled spring metaphor to note that the Nasdaq, recently at 1878, has support, or a possible floor, in the 1775 to 1804 range. "Odds are that the low for the year is in place," at 1638 and the index can move ahead, he said. Friday helped wind that coil, when the Nasdaq rose 73.83 points, or 4%. "It was a significant session and one that sets us up for a decent short-term rally," said Ralph Bloch, chief technical analyst at Raymond James & Associates Inc. Block is especially pleased that the market's laggards showed the most spunk. "That's another thing I like," he said. "Techs leading the way." What the market needs is "another good day on top of Friday's session" to help solidify the prospect of a rally, Bloch said. Technical indicators, such as advance/decline ratios and overbought/oversold comparisons, "are turning positive," said Richard Rhodes, editor of a technical analysis newsletter. "And given the large amount of short positions in the market, a rally in all likelihood will materialize." The move "will be quick and sharp, and quite possibly tradable," Rhodes said. Phil Roth, chief technical analyst at Morgan Stanley, said the Nasdaq has support in the 1800 to 1850 range. Resistance, or spots where selling may taper off, is in the 2050 to 2010 range. If the Nasdaq breaks through that range, the next resistance would be the spring high of about 2250 to 2350, Roth said. But there may be some parting of the ways, with value stocks continuing to rise while tech and telecom remain vulnerable, possibly prompting the Nasdaq's return to its spring low of 1638, Roth said. While citing the prospect of an advance, technicians also say there is a chance for a subsequent pullback. Strength will last "only for a short period," Rhodes said. "After that the major downtrend will once again reassert itself." All the more reason to go into the upturn with the notion of trading, instead of keeping investments for a long time, he said. -By Karen Talley, Dow Jones Newswires; 201-938-5106; karen.talley@dowjones.com (END) DOW JONES NEWS 08-28-01 01:00 PM * end of story *