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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: bobby beara who wrote (29953)	2/13/2002 11:24:22 PM
From: ajtj99	Read Replies (1) \| Respond to of 52237

Bobby, I just measured a complex H&S on the SOXX with a target of about 320. Can you confirm that? That would seem to be something to watch out for if we test the Sept. lows this year. I think we almost have to discount the SOXX as a rational trading index, since it seems to stay pumped until the last minute, then dumps like poop through a goose. Look at how it acted last summer. If the SOXX is going up, the market should trend with it. However, it appears now that the SOXX may not drop quite as much if the market drops soon.

To: bobby beara who wrote (29953)	2/14/2002 12:53:55 AM
From: velociraptor_	Read Replies (3) \| Respond to of 52237

FWIW, I on't have 5 waves down in the SOX. Take a look at my chart... raptorgroupresearch.com The first green wave down off the highs is only 3 waves. You can go to stockcharts and load in the daily chart for this period. It's a clear 3-3-5 flat and no way it could be part of a 5 wave impulse down. The next series in light blue was the B wave, and then we had a 5 wave impulse down into the late Nov 2000 low as seen in green to complete an A-B-C. The next series in purple is 3 waves and so is the down from the May 2001 high into the Sept low. Absolutely no way is that last drop into Sept 5 waves as you would run into overlap in the beginning. Thus you have the second A-B and the rally from the Sept low cannot be counted cleanly as a 5 wave impulse but rather a 5 wave ending diagonal for wave C of the second A-B-C set. If the rally from the Sept low could be counted as a 5 wave rally with impulsive subdivisions I might believe otherwise, but each impulsive wave, wave 1,3, and 5 can only count cleanly in sets of A-B-C's which makes it an ending diagonal. I don't see a bearish crowd by the way. CNBC is raving about a recovery and most sentiment indicators are very bullish. Those P/C ratios might simply be a hedge on the longs as all we have is the number of Puts and Calls but that ratio says nothing about where those options are, nor is it dollar weighted which is a factor as well. I don't follow Rydex because it's not the only fund out there and cumulative, the number and asset base of all the bullish funds in existance far outweighs the bearish ones. I have never understood the focus on one single fund family and whose to say that smart money isn't parked there. The VIX is low. The FED rate cut arrest is a neutral. Low rates don't mean squat because of high debt levels since you can't borrow more when you're overburdoned with debt already. Besides, with industrial capacity at 75% or 20 year lows, there's no point in borrowing for expansion when current capacity can't even be filled and competition cuts profit margins to a minimum on what's left. A raise in interest rates is even worse, because any adjustable rate loan is going to squeeze the holder and higher rates will choke off the latest money supply which came from home refinancings. I'll give you the bonds though as they do appear to be ready to break, and normally bonds and the market compete for money. However, I don't exclude a 3rd factor coming into play here and that is that the extra money will go to money markets, cash, or to paying down debt. In this case, neither the bonds nor the market wins. Cyclicals do look bullish at the moment, but commodoties are bearish having completed a 5 wave move down from the recent high with the current move off the low corrective.