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To: AllansAlias who wrote (78513)	8/6/2003 11:02:49 AM
From: ajtj99	Respond to of 209892

I completely forgot about the COMP gap at 1641. I somehow thought it was at 1663. I've been focused on the NDX, and that gap was at 1219 on the daily. COMP found support at the top of the gap. If we close the gap from the AM swoon, we could drop and fill the rest of the COMP gap still.

To: AllansAlias who wrote (78513)	8/6/2003 1:03:27 PM
From: Perspective	Read Replies (1) \| Respond to of 209892

This bounce is the one to sell, IMO. I have been patiently waiting for the rally of the last nine months to come to an end, and for the first time, I think one can make a reasonable argument for it to be done. From an Elliot perspective, you can either see us done with 5 waves in C up now, and if not, you are in wave 4 with 5 still remaining. Either way, the next bounce is the one to sell. You are a little early if we're just in 4 of C, but just fine if we're already pointed down. I'm straddling the high under these scenarios, exactly where I want to be. Elliot has a Shroedinger wave principle nature to it - it generates a probability "cloud", and that cloud now has maximum density that we are at the high. Seasonality is now working against the market for the next 2-3 months. Swinger glamour-trash is finally running into trouble. TRAD and SOHU are getting worked pretty hard, and the remainder have ceased making new highs. New lows are expanding. We've had sentiment levels (IIA, AAII) push to extremes associated with tops even in bull markets. They have turned down now that we're off the highs, but that is to be expected. They are coincident indicators. We've seen liquidity measures turn against the market, as TrimTabs has been saying for weeks now. New stock and convert issuance hit substantial levels, and insider selling has been a tidal wave. Corporate cash takeovers are non-existent. Foreign investors face a downtrend in the dollar, with more weakness likely as the flood of overseas dollars are gradually redeemed. Interest rates have skyrocketed, which will kill the economy with particular haste thanks to our extreme debt load. And, we have the funnymental hooks you'd expect to permit the smart money to dump onto the dumb money: a tax cut distraction producing its max effect right now, the pop in all the economic indicators, and the absurd short-term rates. Of course, all this falls apart with the new higher long-term rates, but the dumb money is captivated by it while the smart money looks ahead to the next dump. There will be no typical turnaround, because there is no typical pent-up demand anywhere. On the contrary, demand has been brought forward and depleted to an extent similar to economic tops, not bottoms. The next major fundamental feature will be another deflationary scare, as Greenspan won't do a darned thing until his hand is forced, yet again, by falling asset levels. The scare will be produced by the economic weakness brought on by the jump in mortgage rates, caused by the unwinding of all the real estate hedges and rate carry plays that are thinking it's time to stop. I will increase my short exposure by 12% of equity on a 38% retrace of this dump, then again on a 62%, if it should happen. While I had thought the next leg of the bear would focus on Dow types, I think the risk/reward once again favors exposure in the Nasdaq. I'm repositioning away from non-tech into tech right now. BC

To: AllansAlias who wrote (78513)	8/6/2003 1:17:40 PM
From: Perspective	Respond to of 209892

I should add here that I'm more interested in letting a little time pass after this dump before selling, as opposed to price movement. I think we need to correct upward some now. If we're pointing down, we should still chop correctively higher for several days after maybe one minor new low. If we're pointing up, we should launch upward and I'll revise my sell points. If we just sell-off straight from here, I'd be pretty surprised, and I'd have to sit tight and wait for the upward correction of that entire move. Old uptrends die slow deaths. BC