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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: IndexTrader who wrote (4617)	9/18/2001 2:57:02 PM
From: John Pitera	Read Replies (1) \| Respond to of 33421

Susan, thanks for posting Tim Ord's comments. He's very right that we may need several days to make a selling climax, especially since the market was closed for 4 days last week and that means that the psychology of a climactic selloff could be bent out of it's usual pattern. Not everyone is on the street today with the start of the Jewish High Holy days last evening. I don't recall the last time we may a meaningful low in the stock market in Sept. so that is something that makes me wonder a bit. or that it heads into a “Selling Climax” now and ends the bear market. Either way the market is not far from a bull market starting. America will endure “one nation under God with liberty and justice for all”. The only end in sight is this bear market." I'm not so sure that this bear market will end anytime soon. I can believe that a multimonth rally should unfold by the time the end of Oct shows up, but I still think we'll be out in 2003 at least when we see the true end of this market rationalization. John

To: IndexTrader who wrote (4617)	9/18/2001 3:08:46 PM
From: John Pitera	Read Replies (3) \| Respond to of 33421

As I read Chris S's comments from yesterday afternoon, I tend to agree with them, about the orderly nature of the sell-off and the relative lack of panic. Hence, I'm wondering how much more is to come in downside price action in getting to this "Selling CLimax" I guess I'm concerned about how uniformly we've seen in the media, (cnbc, cnnfn, barron's NYtimes, WSJ) that the market is always quite a bit higher 3 months after a day like 9-11-01 or 12-07-41. Chris S's remarks: ============= Chris Schumacher MARKET 9/17/01 3:34 PM ET I was looking at a minus-700 Dow reading and hating it. I don't get emotional in trading, but minus-700 is something I don't enjoy. One of the members in my room said, this is good, we need this to get it over with. My response was the following as it relates to tape-reading principles that govern our understanding of market movements: I don't mind being down 700 if the market is in panic mode, as it indeed clears out the sellers. However, we don't have it. All we have now is slow orderly selling. This is not what leads to readable market bottoms in any time-frame. Slow selling is a principle that describes how smart money functions in an orderly fashion, slowly bringing stocks to new lows. This move is done and ready to reverse when the public goes into action and we see the fast panic selling, which marks the stage when no one is left who is willing to sell and it is exhausted (capitulation often most used for this as a term). So according to tape principles that have been used for centuries in the markets, slow selling to minus-700 is not what we need to see if we are to have hope of some signs of stability. We need some sort of panic to indeed have a stronger sense that the downtrend may reverse. This is a good example of slow, smooth movements in an orderly fashion showing what smart money does, currently still in a slow downtrend, ("smart" is arbitrary term to signify those with larger capital bases) vs. fast erratic movements, which is what the majority does. For now, I have no reason because of this to expect much upside for the last half-hour. Just small waves of erratic unsustained buying. This makes me sit without aggression for the next half-hour on new setups.