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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: Thomas C (Hijacked) who wrote (16179)	5/27/1998 8:29:00 PM
From: Gary Martin	Read Replies (2) \| Respond to of 69340

Thomas, Wow! A 5000 target on the Dow seems pretty ambitious! I prefer to watch the near term support at Dow 8700 and/or the S&P500 at 1068. In any case, I don't know how to use divergences to set price targets (I try to use pattern "measuring objectives" as calculated by a technician such as Ken Shaleen). Even if fundamentals warrant, markets seldom go directly to such drastically new levels. As such, technical chart patterns, coupled with momentum and divergence indicators, are what I have to watch. Please keep in touch with your observations. I will comment on any technical signals I see as well. Gary

To: Thomas C (Hijacked) who wrote (16179)	5/27/1998 10:20:00 PM
From: j g cordes	Read Replies (1) \| Respond to of 69340

Tom, I'm a technical analyst with fairly good horse sense... which is a poor lead in to some practical thoughts on the subject of trading stocks to make money. I'm responding in part to your post but more to the need we sometimes have of making the big call.. picking 5000 when we're at 9200, or 9200 when we're at 5000. A more blunt lead is_ it doesn't matter if the dow average goes to 11,000 next month or to 5,000. What matters is where is the stock you're in going after you buy it, or after you short it? Few of us actually trade an average... and who is putting real money on the dow going that low... those are pretty distant targets. The OEX is at 532, do they even have 300-400, 450 puts? Of course you could short the market, there's no strike price in that game. Trading gets down to specifics very quickly and many stocks run counter to the averages. Remember its been fundamental earnings warnings that have triggered technical retracements. From a practical standpoint, the averages can help a trade, especially if a stock is overbought or oversold. The downdrafts of the last three days have accelerated down trending stocks, stalled the progress of stocks trending up AND made already oversold stocks ripe candidates for reversal plays. Last, technical and fundamental go hand in hand.. its like the old argument of mind body.. they're just two extensions of logic, each inadequate to explain the whole. Jim