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To: Les H who wrote (1260)	1/7/2002 6:42:37 PM
From: Les H	Respond to of 29592

What to expect now. January 7, 2002. Oracle. In candlestick charting on the March S&P, a bearish "Three Back Crows" formed December 7, 10 and 11. This pattern forewarns for a significant decline coming. Usually right after the "Three Black Crows" form, there is bounce in the market. This bounce took the market right back up to test the December 6 high. Friday's test of the December 6 high occurred on slightly higher volume and needs more confirmation to signal resistance. Today's test of Friday's high was on lighter volume, but did not coincide with a bearish candlestick pattern. The "Percent Volume" indicator is still overbought at .49. The "5 day ARMS" closed today at 6.41 and is the type of reading found at bottoms not tops. This indicator needs to unwind. The VIX is warning that an intermediate term top is near with a closing reading of 22.17. Advance GET (and Elliott Wave program) has an upside target on the S&P between 1184 to 1192. We still hold a short position in the SPX at 1091.63 for mutual funds purposes. We feel this position will be profitable on the next turn down, which should begin soon. There could be one more short-term stab up before the S&P turns down. The VIXN is in an area where intermediates term tops form. A bearish candlestick pattern called a "Bearish Engulfing Pattern" appeared today. On Friday, the Nasdaq Composite drew a bearish Candlestick pattern called a "Doji". This bearish "Doji" tested the previous high set on December 6 and closed below that high, creating a bearish "Upthrust". The "Hour average Tick reading" turned down this afternoon and is usually a trend reverse signal (from up to down). The "5 day ARMS" on the Nasdaq closed Friday at 4.64 and today at 5.27, both of which are considered neutral for the Nasdaq. Candlestick charting and the tick index readings issued a sell signal today on the Nasdaq Composite. We are short the QQQ on today's close at 41.12. We are putting our stop on the Nasdaq composite at 2095 in place of the QQQ. The XAU bigger trend is up and much higher prices will be seen. We expect this rally on the bigger time frame to last for months. We like AEM, Drooy, ASA and HL. ASA appears to be drawing a bullish "Fry Pan Bottom" on the weekly chart. Drooy is right at the breakout area near the 1.45 range closing today at 1.41. A high volume close above 1.45 would breakout this stock out and would imply a rally to next resistance near 2.30. Our upside target on the XAU is still 95 minimum for the longer term. marketweb.com