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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: current trend who wrote (13050)	1/11/1998 6:19:00 PM
From: gianelda	Respond to of 94695

THE Hong Kong Trigger read today's FT headline on HK direction biz.yahoo.com monday's call for calm in HK : Monday January 12 1998 Sir Donald calls for market calm DAVID IBISON Financial Secretary Sir Donald Tsang Yam-kuen made another plea for stock market calm yesterday, urging investors to react rationally to the likely collapse of Peregrine Investments Holdings and Friday's interest rate increases. The comments form part of a concerted attempt by Sir Donald and Chief Secretary Anson Chan Fang On-sang to quell fears of a severe market correction this morning. Hopes Peregrine would broker a rescue deal with a potential "white knight" faded last night with industry sources saying that "short of a miracle" the investment house would be liquidated today. Any collapse is expected to increase fears the economic crisis will claim more victims in Hong Kong and further undermine investor confidence. There are also increased fears of a renewed attack on the Hong Kong dollar combined with potential capital flight by local investors. Sir Donald said the interest rate rises should not have too severe an impact on the market. The Hang Seng Index plunged 16.7 per cent, or 1,785.93 points, last week to close at a more than two-year low of 8,894.64. Peregrine's financial difficulties spurred a 6 per cent drop in Hong Kong shares trading in London Friday, with the Hang Seng London Reference Index plunging 526.72 points to 8,367.92.

To: current trend who wrote (13050)	1/11/1998 7:37:00 PM
From: James F. Hopkins	Respond to of 94695

HI CT; It will be reliable, to the extent of the reader to understand it, but I would think you would not use it as your only indicator. The reliability would also depend on other factors that we can't see. A major war, or even a profound change in one of the major political systems in the world could easily over ride it. I doubt any one can find something that's reliably reproduced every time, But if all other factors remain about normal then it predicts the normal swing of things, based on a few general rules. Public opinion is fickle, but as fickle as it is, the major money is in large cap stocks. The large cap stocks send the signal when opinion or mood is changing before it is noticeable in the general market. A bull run starts to turn with the MEGA caps while the others are still climbing. Like wise the MEGA caps who really started down first, will also bottom first while the little guys keep diving. The smaller caps are always catching up, or over running the MEGA caps. Not only did the small caps put on a good show this summer, they were HOT for a while not just out running percentage wise the MEGA caps, but ran past them by that I mean kept putting on gains after the MEGA caps had started south. That "type" over running sets the indexes, and produces a false curve based on the price gaines of a majority of stocks, that really only command a small percentage of the money. Even the A/D ( advance/decline) will look like the bull run is strong with the As out doing the Ds in number, making the market look strong, but when in reality the MEGAs are retreating. ------------------------------ AT this time In the DOW..the top 10 caps, average 124B , while the bottom 30 caps only average 31.05B, yet the bottom thirty can run the index up while the top 10 are falling, and that's when things get setup for a big change. ------------------------------ How far out can this signal, heck I'm no way sure of that yet, it's kinda new to me. Even if I didn't use it to lay bets on, I sure as heck would not bet against it, no way hosa. I've seen enough already that I'd rather shoot myself in the foot than bet against it. :-) And I don't want no hot stocks, no matter how good they look..if the MEGAs are going south. No dead cat bounces, and no falling knives until the MEGAs turn north. It's really kinda simple. ------------------- What happened Friday..inside the DOW ? in a nut shell, THE MEGA 10- down avg -2.79% Tail 20 down avg -3.15% ( based on market cap.) here the tail is out running the head south, what I wait for is to see the MEGA 10 start up with the tail 20 still going south, till then I wont try to call a bottom, on any thing. IT looks ugly as all 30 were down, but it would look even worse if the % were reversed, and the MEGA 10 was dropping at a faster rate than the tail 20. If that happens, the one stock I'm still holding will get dumped. ------------------------------------ Jim Is any one having a hard time post to SI other than me!