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To: Victor Lazlo who wrote (148159)	9/26/2002 11:10:55 PM
From: Oeconomicus	Read Replies (2) \| Respond to of 164684

Hey, here's some market commentary for everyone. Hope no one minds. ;-) Forbes Magazine Signs Thursday September 26, 6:34 pm ET By Laszlo Birinyi Jr. Excerpt: The chartists are warning of a further correction ahead. But their predictive record saps their credibility. In 1990, following the Kuwait invasion, for instance, the market dropped 21%, to a low of 2365. Almost to the day, an article took the pulse of the technical community: "Analysts Are Reading Their Charts--And Weeping," (Business Week, Oct. 8, 1990). Well, three months later the Dow hit 2600. In December 1991: 3100. You'll also be hearing about the wonders of the advance/decline line, a favorite chartist tool to divine underlying investor sentiment. (It's a cumulative total of the number of stocks going up each day minus the number going down.) A rising line is supposedly a bullish sign, and a declining one, a bearish sign. Right now the line isn't showing us much of anything, although surely someone will soon find some portent there. Trouble is, this measurement merely tracks the market and doesn't get out in front of it. In seven of the last eight bear markets the advance/decline line bottomed on the same day as the market. Then there's the capitulation theory, embraced by many investors far beyond the technical crowd. The theory holds that bear markets come to an end with a selling climax, which acts as a harbinger of new bull markets. Then sellers are exhausted, the reasoning goes, and only buyers are left standing. These cataclysms, though, seldom occur; bear markets often end with a whimper. A New York Times story on Aug. 15, 1982 reported the consensus of market savants: "The long bear market seems to be entering its final phase. The end could be violent." Yet the market had already bottomed the previous Wednesday with little noise. biz.yahoo.com