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Strategies & Market Trends : The Rational Analyst -- Ignore unavailable to you. Want to Upgrade?

To: IQBAL LATIF who wrote (890)	5/11/1998 11:45:00 PM
From: HeyRainier	Respond to of 1720

[ World Markets ] Hello Iqbal, In a message you posted sometime last week, I believe you mentioned a target for the Japanese market at around 23,000. I was curious about your rationale for that target. Some recent conversations from those with a bird's-eye view of the economy are telling me that the worst is not yet over. Dominoes are continuing to fall and the sentiment there is as bearish as we are bullish here in the US. The technical picture for the Nikkei shows that it continues to be in a trading range from 15,000 to 21,000. We're a couple hundred points from the bottom end of that channel (at about 15,400). Downward momentum acceleration has not yet troughed yet, and the intermediate term down trend still has not been broken. Asian funds continue to look sick (China, Taiwan, Singapore). European funds (Germany, France, UK) are continuing to exhibit strength, as is Australia. And the US market continues to lift all boats. After looking at a couple international market funds, it's pretty easy to think that we're getting a little spoiled. Momentum continues to weaken for the US markets. I imagine the markets will consolidate at this point or will decline to less nervous levels, particularly since the bond has crossed above the 6 percent threshold. I am still playing defensively here, and am not acquiring issues either for short or long term unless the downside risks are perceived by me to be extremely low. Wouldn't one think that with all this merger mania that we would have closed higher than we did today? Something to think about for the near term. Regards, Rainier