The events that can move this mkt:
Wednesday:
4:44pm 09/18/01 LAWMAKERS MEET WED WITH GREENSPAN, O'NEILL ON ECONOMY
Saudi minister meets w/Bush on Wed/Thurs:
cbs.marketwatch.com
Friday:
Options expiry day.... careful!
Fri/Sat/Sun: possible first strike against terrorists
Wednesday the 26th:
OPEC decision due
Analysis:
Last year at this time, the declining tech mkt was attributed to tax-loss selling, due to end by 10/31. But the mkt continued to befuddle, falling into January.
This year, the same tax loss selling is evident. However, this time I expect it to end early. How early? Possibly by Sept 27, 28 or Oct 1st.
Two reasons: selling at the end of the quarter is common, followed by window dressing. Also, the terrorist attack granted institutions the perfect day (Monday) to dump some of those losses early, hoping to regain some losses before the quarter closes.
I'm very confident Saudi Arabia & Kuwait intend to increase production next Wednesday. Iran is not likely to oppose this move either. With a Saudi minister due to meet with Bush tomorrow or Thursday, we should find our bottom in early trading tomorrow.... for now.
Sometime tomorrow, a rally starts and continues through Thursday. Friday, with options expiring, should be neutral. The rally may or may not continue through Monday and Tuesday.
Wednesday, the OPEC decision will be anticlimactic and the mkt can be expected to sell off. Coupled with tax loss selling, look for late Tues, Wed, Thur, Fri of next week to be very bearish.
In fact, that's when I expect to see a bottom.... probably THE bottom we've been looking for.
Why? I think, just as Greenspan raised rates 1 time too many in 2000, he's lowered more than needed now. Coupled with the liquidity he pushed into the finance system in the past week, these pump-primers parallel the situation during Y2K planning.
You recall that bubble, doncha?
All the bad news that can fit has been priced in, short of a holocaust. Not all stocks will run, but many will. Most will be 2 day wonders, if they're substantially below Jan 1 prices. It's still wise to consider sectors, growth and profitability if you're investing, not trading.
I would not touch airlines, hotels, apparel, insurance, brokers, oil, alternate energy, PCLN TVLY EXPE PPRO for awhile.
Some I like right now or soon: NEWP*, IWOV*, IDCC, MVL, BORL*, ATYT, UTSI, CHINA*, SINA, DRIV, XYBR, ELON, HPLA, NAVI*. |
