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

To: Mark L. who wrote (40486)	10/18/2002 1:17:39 AM
From: Joseph Silent	Respond to of 52237

Mark, Thanks for that astute and very well-written assessment of this peculiar rally. From reading the boards I observe that its vicious nature has caught many of the SI market veterans by surprise. That is surprising in itself because everything I have read (and it's not a great deal really :) ) about previous bear markets has emphasized that bear market rallies can be sharp and vicious. So one would think we should expect to be surprised (if, indeed, such a position is possible) by sudden, vicious rallies. In any event, I agree with what you say. In general, I also believe that the market is a random process (not in the sense of classical Brownian motion, but perhaps nearly so) in which supporting conditions periodically change -- which is why predictions based on statistical data fail as often as they may work, i.e., the underlying process from which one is sampling is continuously undergoing change. Distributions are not stationary. Your data on the spike in the number of hedge funds and the spike in the (newbie) shorts is one example of what spoils stationarity. If what you say is right (and I feel it is) then we are bound to see sharper moves up and down, in smaller time frames, until the economic landscape changes and uncertainty cannot be exploited with as much potential for profitability. /j

To: Mark L. who wrote (40486)	10/18/2002 8:36:58 AM
From: GREENLAW4-7	Read Replies (1) \| Respond to of 52237

Mark, great post but consider this. Could a gropu of hedge funds CONSPIRE to pump the market and cause short squueze? On thursday all indications were 7000 was history. Why would anyone cover any short, actually many were adding to positions between tuesday and thursday as market was breaking. But those hedfe funds had something else in mind. Is it coinsidental that earnings were just days away. Its sad to think how manipulated this market really is.

To: Mark L. who wrote (40486)	10/18/2002 8:54:57 AM
From: Stephen	Read Replies (1) \| Respond to of 52237

Mark L, I've been considering the same thought myself these last few days. This was touted as the first year ever that hedge funds were showing losses ...with the numbers (1.5%) to (5%) being suggested... which obviously presents them with major problems.... not because they haven't beaten the market, but because they need to make money to get their cut. However, if they have been backing the move up ... and it is only a trading move ... at what point do they lock in profits. Do they chance losing it after they have turned their year around a little ... and if they all decide to do it at the same time ....or even short it ... the market could be in for a lot more trouble. Just my recent thoughts fwiw as traditionally, the stronger reports occur this week ... so it makes some sense to get out of the way of next week. Best regards Stephen

To: Mark L. who wrote (40486)	10/18/2002 5:50:09 PM
From: energyplay	Respond to of 52237

Brilliant Post ! A market observer on TheStreet.com pointedd out a few days ago the the stocks up the most were the lower quality secondary ones with high P/Es, and not ususally the market leaders. The value stocks were not up as much in any given sector. This tends to confirm you idea - the short fodder went up because of covering, not buyers grabbing value. Best Regards, energyplay

To: Mark L. who wrote (40486)	10/18/2002 11:31:07 PM
From: rogermci®	Respond to of 52237

Amen, brother. I had strong suspicions that a portion of the bear market especially the last 2 months was being exacerbated by the hedge funds and amateur shorts. It's been my experience though, that technicals rather then fundamentals, drive bull moves within secular bear markets. And the fact of the matter is, I've never seen shorts more bolder and arrogant then they are today. A price must be paid. This cyclical bull rally will confound everyone and IMO carry further not so much in price, but in duration then most think.