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Politics : Dutch Central Bank Sale Announcement Imminent? -- Ignore unavailable to you. Want to Upgrade?

To: Ahda who wrote (18325)	5/19/2003 7:12:41 PM
From: sea_urchin	Read Replies (1) \| Respond to of 81957

Darleen, very interesting............ Bob is a mine of information. However, lets talk about it some more. In my opinion, what is important is not the actual price but what it represents. At this time a big price movement, like $12/d, tells us that there is BIG speculative interest --- people can't wait to get in. Look at this chart again. stockcharts.com[l,a]dallynay[dd][pb50!b200][ilb14!la12,26,9] On the chart, measure the distance, with a pair of dividers or what have you, between the actual price and the 50day moving average. What you will find is that difference between today's price and the average of the last 50 daily prices (blue line) is the second greatest in the past year and was only just exceeded at the last major peak, at the beginning of February, from which the price fell back sharply. In fact, today's price is $27 higher than the average. This extreme value also tells us is that today's price action is unlikely to be exceeded in a hurry. The implication is obvious. Further, whenever a market becomes highly speculative, which, for the above reason, one can see it is at the moment, the psychology of panic gives rise to excessive volatility and very sharp swings in price. Today, the panic was clearly to get in. That's why I make the point that, if the present price movement is not sustained, it will reverse because of the excessive speculative, and not true investment, interest. Very often movements like this are brought about by people buying on credit. This makes the market even more susceptible to a crack because the speculators will panic out as easily as they panicked in.