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Strategies & Market Trends : Galapagos Islands -- Ignore unavailable to you. Want to Upgrade?

To: Oral Roberts who wrote (39552)	5/14/2003 7:17:52 AM
From: orkrious	Respond to of 57110

from Jay Shartsis, StreetInsight Entertaining the Shorts 05/14/03 07:13 AM EDT There's enough here to keep the bears happy. Tuesday's muted market decline resembled most other retracements over the last couple of months in that the action remained positive. Advancers easily outpaced decliners on the Nasdaq as the Comp dropped only slightly, while the New York Stock Exchange advance-decline line settled just barely negative and the Dow Jones Industrial Average trimmed 0.54%. Volume and new highs/new lows were similarly supportive both on the Big Board and the Nasdaq. While the bears will take little comfort from those constructive internals, the last couple of sessions have produced a technical twosome they can sink their teeth into. First, closing upticks of more than +1000, such as that which occurred last Friday, nearly always lead to at least a short-term market top within two sessions. We needn't look back very far to find the accuracy of this unique indicator on display. Just a week earlier the same phenomenon occurred, preceding last Tuesday's interim market peak. Then there's the behavior of the intraday put/calls thus far this week. For the first time in a while the all-exchange ratio became somewhat bearishly sensitive Monday, falling stride for stride with the market's steady climb and ending the day in the low 60s. Yesterday, then, call buyers stayed active both in the morning and afternoon selloffs, keeping the ratio in the low 60s throughout the session. I think, together, these two short-term bearish developments, along with the market's extremely overbought condition, carry sufficient weight to entertain tight-leashed shorts.