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To: Les H who wrote (1302)	1/14/2002 6:41:50 PM
From: Les H	Respond to of 29592

What to expect now. January 14, 2002 The NYSE has a high "5 day ARMS" reading, closing today at 7.39. Readings over "6.00" appear near short-term lows. The "Percent Volume" indicator came in today at .36, which is also oversold. Another bearish "Three Black Crows" appeared on January 7, 8 and 9 on the S&P. The previous "Three Black Crows" was drawn on December 7, 10, 11. This double "Three Black Crows" is a very bearish sign for intermediate term. The VIX has come in at a very low level for a month bouncing between 22 to 25. This low of a VIX reading for the last month suggests that the market be at an intermediate term high. The short bounce up in the VIX over the last 5 days suggests the S&P is about ready to bounce for the short term. Today's range in the S&P was narrow and the volume increased, which implies accumulation for the short term. No bullish candlestick pattern was drawn today. If a bullish candlestick pattern shows up tomorrow, we may go long the SPY for a short-term bounce up. We are still short the SPX for mutual fund purposes for intermediate term and we expect this position will get profitable on this turn down. We are flat the SPY for the moment. The Nasdaq Composite drew a bearish candlestick pattern called a "Doji" on January 4 and a bearish "Bearish Engulfing" pattern on January 5 and a bearish "Upthrust" on January 9. That's a lot of bearish patterns for four short trading days. The "5 day ARMS" on the Nasdaq came in at 3.80 at the January 8 time frame, right in the topping area. Readings near "4.00" and under on the Nasdaq are bearish. An "Upthrust" (the January 9 high) usually have a test. The test should be on lighter volume than the volume on the "Upthrust" day and the lighter the volume the more bearish the signal. The Nasdaq Composite may have made an important intermediate term high on the January 9. We are short the QQQ at 41.07 from January 10. We covered half this position today at 39.97 at our 1:30 Eastern update and moved the stop on the remaining ½ to 41.07. The XAU longer-term picture is bullish. The short term picture on the a lot the gold stocks have drawn bearish "Doji" patterns over the last couple of days and suggest the XAU may stall in here for a bit and have a pull back. We sold ½ of our position in Drooy today because of he bearish candlestick patterns drawn for the last three days on that stock. ASA has also drawn bearish patterns. March Gold has drawn some high volume "Doji's" and looks to pull back down to at least 280 near term. Our upside target on the XAU is still 95 minimum for the longer term. marketweb.com