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Strategies & Market Trends : Classic TA Workplace -- Ignore unavailable to you. Want to Upgrade?

To: The Freep who wrote (27760)	1/13/2002 5:35:39 PM
From: John Madarasz	Read Replies (3) \| Respond to of 209892

no biggie freep, by replying to you, i was just trying to cover bases and several other posts I'd noticed re: the COT's Still, the COT trend shows the commercials getting less short these past few weeks while still being quite net short. Does this, based on the history, imply the market should soon rally, tank, or do nothing? I'd be interested in your take. Again, i think trying to use these lagging indicator reports which are already 3 days old the day they're issued as a predictive tool, at this stage, is probably pretty much a waste of time...especially given the fundamentals of the market and the economy at this time. None of the COT equity index #'s are at extremes, where the report values have historically given their best signals. This also goes to my earlier post, where I'm agreeing with Allan that "something stinks". I don't know what it is exactly, but the impression I'm getting is that sooo many of the commentaries and charts from traders i'm seeing lately are all using the same (or very similiar)parameters on their indicators...everyone is tripping over themselves to get to the COT #'s each Friday...everyone including even the most inexperienced traders are watching the P/C and VIX on a minute to minute basis... etc.etc. it hints to me of ubiquitous"indicator failure". something that is often found at major market turns, and something that usually portends violent action up, down or both. Volatility measures have been extremely low of late. And as far as tech is concerned, which is mostly what is followed here,... it's more overbought then it's EVER been... the OTC hi-lo bullish % which is the short term mostly tech indicator reached 92% this week. FWIW this indicator has NEVER exceeded the 80% level. Stockcharts is showing tech at ALL TIME 6 year highs... stockcharts.com[e,a]daclnnay[d19960101,20020113][pf][iUb14] EVERYONE owns tech right now, there are no buyers left to push the market higher, only a short squeeze can do that, and Allan has raised the appropriate red flag. Sector rotation to move the other Bullish percent indexes to toppy territory...very possible. But at this stage i'm very tenative in using an indicator, especially a "most watched" one like the COT's for predictive value.