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To: Les H who wrote (1378)	1/28/2002 7:56:49 PM
From: Les H	Read Replies (1) \| Respond to of 29595

What to expect now. January 28, 2002. Ord. marketweb.com There are cycle for a high due between now and January 31. The VIX is still hovering near a 12 month low closing at 21.78. The only times the VIX was as low in the last 12 months, came at the July 2 top and the June 5 top. The low VIX readings suggests that there is a very limited upside on the S&P. The "5 day ARMS" is in neutral territory closing today at 4.96. If in the next day or two the "5 day ARMS" closes near "4.00" or below, we will take a short position in the SPY. There is heavy resistance near the 1150 level on the S&P and it is doubtful the market will close above it near term. We are short the SPX for mutual fund purposes at 1091.61 from an earlier date. The minimum downside on the S&P for the intermediate term is 1060; which is a 50% retracement. We will see if in the next day or so the market can bounce near the 1150 area and get the "5 day ARMS" near a reading of "4.00". The VXN hit a 12 month low today of 42.96. The previous low came on July 2 with a reading of 43.17, which marked a top on the Nasdaq Composite that still has not been broken. The "5 day ARMS" on the Nasdaq closed today at 5.17, which is approaching the bearish side. A 2.06 reading drops off tomorrow on the "5 day ARMS" and if a reading of around 1.00 on the closing comes in tomorrow than the "5 day ARMS" will close around "4.00" and will be bearish. We have resistance areas on the Nasdaq Composite between 1950 to 2000. Today, the Nasdaq traded to 1959 on lighter volume than the previous high. There are cycles for a high coming in from today to the 31 of January. We are taking a longer-term trade on the short side with the Nasdaq Composite that may last several weeks. We are short the Nasdaq Composite at today's close at 1943.91 and our stop will be a close above 2054. There is a possibility that the Nasdaq Composite could hit a new low below the September 21 low on the next decline. A short-term trade on the short side may line up on the QQQ on the current bounce. This current bounce could last into Wednesday or Thursday at the latest. With the VIXN and "5 day ARMS" at such low levels, the current bounce has not much further to go. The XAU longer-term picture is bullish. There are short-term cycles for a high due between January 14 to 21. We sold ½ of our position in Drooy on January 14 because of the bearish candlestick patterns drawn for the last three days on that stock. We still hold ½ of our position we bought at 1.05. Our upside target on the XAU is still 95 minimum for the longer term. Be patient on Gold stocks, they will work higher. tim sharp's spx chart traders-talk.com