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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Donald Wennerstrom who wrote (41290)	11/1/2008 9:05:48 PM
From: Return to Sender	1 Recommendation Read Replies (1) \| Respond to of 95617

Amateur Investors Weekend Stock Market Analysis (11/1/08) amateur-investor.net:80/Weekend_Market_Analysis_Nov_1_08.htm Despite all of the volatility in the market it appears we could be seeing a potential bottom in the near term which may allow for an end of year rally however this is likely not a major Bear Market bottom so keep that in mind as we move into 2009. For those that follow Elliott Wave Theory it appears the 3rd Wave down may have ended and we are now in the beginning stages of the 4th corrective Wave which will be to the upside. A simple example of an Elliott 5 Wave Pattern is shown below. Notice Waves 1, 3 and 5 are to the downside while Waves 2 and 4 are to the upside. If this is the beginning stages of the corrective 4th Wave to the upside here are some longer term upside resistance zones to watch through the end of the year. For the Dow the first area of upside resistance will be at its declining 10 Week EMA (blue line) near 9900 while the second area of upside resistance will be at its 38.2% Retracement Level near 10250 (point A) calculated from the October 2007 high to the most recent low. As for the Nasdaq the first level of upside resistance will be at its declining 10 Week EMA (blue line) near 1920 with the second area of upside resistance at its 38.2% Retracement Level near 2020 (point B) calculated from the October 2007 high to the most recent low. Meanwhile for the S&P 500 the first level of upside resistance will be at its declining 10 Week EMA (blue line) near 1065 while the second area of upside resistance will be at its 38.2% Retracement Level at 1120 (point C) calculated from the October 2007 high to the most recent low. Keep in mind once the corrective 4th Wave up completes itself there will likely be one more substantial 5th Wave down to complete the longer term Elliott 5 Wave pattern however that more than likely won't occur until some time in the early to middle part of 2009. Finally not many people look at longer term trends of the market going back to 1900 however when you look at a chart of the Dow there are some interesting things to notice. First the Dow has gone through Bearish and Bullish Cycles lasting several years. Prior to the big move in the 1920’s (points D to E) the Dow got stuck in an extended trading range from 1905 through 1920. Meanwhile after the big crash from 1929 through 1932 (points E to F) the Dow then formed a Triangle pattern from the early 1930’s through the late 1940’s which was then followed by another big move in the Dow through the mid 1960’s (points G to H). After this Bullish Cycle ended the Dow then got stuck in another extended trading range from the mid 1960’s through the early 1980’s before making another big move upward through the late 1990’s (points I to J). Meanwhile despite the Dow making a new all time high in 2007 one has to wonder if it has been developing another Bearish Cycle since 2000 much like occurred from the mid 1960's through the 1970's as the current chart of the Dow looks similar to that period of time. Notice in the chart below that the Dow was at nearly the same level in 1966 as it was in the early 1980's and didn't rise substantially above that level until 1983. Previous Bear Market Cycles have last anywhere from 15 to 18 years so if the Dow is developing the same type of pattern that occurred from the mid 1960's through the early 1980's then we could see an extended choppy trading range continue through the 2015 to 2018 time period if we use 2000 as the start of the latest Bearish Cycle. Keep in mind there were some decent moves upward from the mid 1960's through the early 1980's (points K to L) however those moves were offset by some substantial drops as well (points L to M). Thus it appears market timing will be important over the next several years as the Buy and Hold Strategy that worked well in the 1980's and 1990's may not work out as well.