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To: MythMan who wrote (230813)	3/24/2003 8:05:52 PM
From: orkrious	Read Replies (1) \| Respond to of 436258

lance lewis' comments tonight: We discussed the likelihood of last week’s rally falling apart quickly to be fairly low, barring an exogenous event, because during all the previous countertrend rallies of the bear market, it took time to put in a distributive top before we could roll over again and resume the primary downward trend. If the war begins to go badly (meaning lasting longer than expected), this would fall under the heading of an “exogenous event” in my book. Today’s losses were in fact the first that I have seen during the bear market where a strong thrust like Friday’s was completely erased on the following the day, and this comes on the heels of a rally which did not have the usual bearish sentiment indicators that we have seen in the past. So, we may be entering a period where many of the old “rules” are changing. We also appear to have seen a 90 percent down-day today following last week’s manic snapback rally. Historically, such a snapback rally is what precedes a series of 90 percent down-days in a bear market (otherwise known as a panic) according to Lowry’s. Today may not even have been a 90 percent down-day, but the selling was certainly more aggressive than we have seen in the past after other “oversold” rallies. The primary trend remains down (it’s a bear market), and a countertrend rally is based mostly on emotional buying and fear-induced short covering (the opposite is true during a bull market). So, if the emotional “good cheer” of a quick and easy war is removed, the primary bear trend may be able to reassert itself fairly quickly. We shall see. Today’s selloff could be just a “pullback” and a partial unwinding of last week’s expiration induced panic. But things could also just easily turn sour very quickly for stocks (and perhaps for all US financial assets for that matter) if the war begins to go badly and removes the positive emotional buying that is currently supporting us. As US and British forces near Baghdad in the coming days, we may get a better idea of how things are going to go, but the odds for a short, easy victory have most certainly fallen due to this weekend’s events. And that means that the bear might reassert himself quicker than expected.