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Strategies & Market Trends : Ask Vendit Off-Topic Questions -- Ignore unavailable to you. Want to Upgrade?

To: Vendit™ who wrote (2320)	11/29/2004 12:31:41 AM
From: Walkingshadow	Respond to of 8752

Hi Reid, Very nice. Basically I agree. Most likely, a pullback to the middle of the BBs is on the agenda, which would entail a break or the lower trend line. Market has been overbought now for several weeks, which cannot be sustained. Sell signals are clear. Put/call also has had a sell signal in place now for several days. But as you hint, I suspect there will be one more surge of irrational exuberance before this happens. This should end quickly, likely by the close on Monday, as you suggest. This scenario is supported by the internals. The TICKS are rising from rather low levels. But the TICKs are very short term indicators that can reverse in a hurry. Consistent with this, at the moment the futures are all up, the dollar's slide has stabilized (for now), and oil is down a bit. The Hang Seng and the Nikkei are both up strongly as well. These are not leaders, New York sets the pace. But sometimes momentum from these can carry over into the open in New York before the big boys take charge. So all these things favor an uptrend early in the session. But all the other internals I follow regularly (volatilities, put/call, TRINs), which do not have lightning-quick trigger fingers like the TICKs, all are set up nicely for downside price movement. So basically, market internals support your projection. From the perspective of internals, once the TICKs finish peaking, then the markets can begin to correct. From the standpoint of sentiment, there is news out that the holiday buying was strong on Friday, but tapered off markedly over the rest of the weekend. That should start to throw a wet blanket on things. Lots of news this week will affect things: Preliminary GDP and Consumer Confidence will be released on Tuesday; Personal Spending on Thursday; several employment reports on Friday. Terry