Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Uncle Frank who wrote (82384)	11/9/2001 12:09:31 AM
From: Timetobuy	Read Replies (2) \| Respond to of 99985

Sort of. Cisco has one of the best supply chain management programs in effect and things got out of control there. Nike's problems weren't solved with ITWO either. Technology has it's limits. That being said, I think the economy is going to be just fine. Not gangbusters like in 1999-2000, but enough to prevent a long drawn out recession.

To: Uncle Frank who wrote (82384)	11/9/2001 6:57:37 PM
From: bobby beara	Read Replies (1) \| Respond to of 99985

but I'm guessing we'll avoid a lengthy recession.>>> i hope your right, but i'm guessing this will beat the early 90's recession, it already has in a lot of areas ____________ The Option Strategist HOTLINE Thursday, November 8th, 2001 Stock Market Whether it was the Fed's rate cuts or not, the market rallied strongly Tuesday and Wednesday after those cuts and pushed through to new post-September highs. That technical breakout is quite bullish. So, as long as prices of the major indices hold above those breakout levels (or even stay above their 20-day moving averages), we must remain bullish. That breakout level represents support now. Those levels are 565-570 for $OEX, 1100-1110 for $SPX, and 36-37 for QQQ. The Dow hasn't quite completed its breakout over the 9600 level yet, but if it does, it will have a chart that closely resembles the others. As long as these indices remain above the afore-mentioned support levels, then we shall remain bullish. Once again price action is the dominant indicator. However, the other indicators are important, too, of course. The equity-only put-call ratios are all trending lower still. That's bullish. There won't be a sell signal until they roll over and begin to trend higher. That could happen at any time, of course, but experience has shown that it is best not to try to anticipate such a change of direction in these put-call ratios. In fact, when they are near the edge of their graphs as they are now near the bottom of the graph that is often when some of the strongest moves occur. Nevertheless, if we are still in a bear market and there is ample evidence to indicate that we are then it probably won't be long before we get some sell signals. In essence, they are "overbought." Other put-call ratios have already begun to generate sell signals. These include the $OEX weighted ratio, both S&P 500 futures option ratios, the QQQ weighted ratio, and the NASDAQ-100 ($NDX) weighted ratio. Finally, there is volatility, as measured by the CBOE's Volatility Index ($VIX). Suffice it to say that it is also in a bullish mode. The bottom line is that prices are moving higher and that should be respected. There are no major sell signals yet, although there are some growing overbought conditions. How far can the rally go? Well, it is about to run into the major down trend line of the bear market the line that connects the tops of August, 2000, and May, 2001. In $OEX terms, that line is between 585 and 590. So, when the irresistible force meets the immovable object, what happens? I don't know, but I'm certain that the indicators will guide us well: if we get sell signals and the afore-mentioned price support levels are broken, then we'll go short. Otherwise, we'll stay long our $OEX bull spreads and $DJX straddles.