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

To: HoodBuilder who wrote (48782)	11/8/2003 10:43:35 AM
From: PuddleGlum	Read Replies (3) \| Respond to of 57110

Don't go too far out on that limb, Michael. Market strength seemed bubbleicious back in April/May, and now we can see why (there were supporting observations even then, but they were more like hints than hard facts). The stronger the market move, the greater effort that is needed to stop/reverse it. Even if the top is in, the near-term declines may not be very great. On my weekly charts, the October 2002 and March 2003 bottoms look very convincing. An end to the rally will need to be nearly as convincing. On weekly charts I see some bearish divergences for various indices, but I don't see a total breakdown. $NDT is due for a significant decline, but hasn't broken down or telegraphed a breakdown. $UDX is a prime candidate for ceasing its downward trend. Also on weekly charts the BBH and TTH appear to be capable of more upside (I still have some BBH puts that I have almost dumped many times). $BKX is near the top of a multi-year consolidation pattern. The $MID just broke a quad top going back to 2000. A number of high-tech holders just hit new 52-wk highs, which bodes well, not ill. So, we have lots of mixed signals. None of this counters your argument that the top is in or close at hand, but I have been thinking that for a long time. I believe that we will have some further deterioration before we see a vicious decline. I won't add to my short positions until I see some more evidence that a significant decline is imminent. A decline in liquidity (did zonder have something to say about that?) will precipitate the sell-off. The market is irrational. I try to follow the market. Therefore... (don't even try to complete that statement!)