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Strategies & Market Trends : Stock Attack -- A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: dennis michael patterson who wrote (12879)	7/22/1998 8:44:00 PM
From: ViperChick Secret Agent 006.9	Read Replies (2) \| Respond to of 42787

I cant remember what I have read where right now so here is something on Dell in case you all havent seen it +Judy (4982 ) From: +P&F-Madness Wednesday, Jul 22 1998 3:37PM ET Reply # of 5038 Hi Judy, So true. P&F combined with FA is the best way to use the methodology. You can use it for trading but you have to look for specific signals, meaning some are better than others for initiating short trades. Take for example Dell. It broke a triple top at 96 and then took off. I know traders on the floor that look for triples like this for quick trades. They love 'em. Now, Dell. Moved down two more boxes today to 106. Next support for a pullback is 98. I'm basing that on the last resistance level. The next support level is way down at 90. 89 would be a big break in Dell. So, if it reverses up from the 106 box, I'd use 104 as the trade stop. If not, one has to go by percentage risk. Let me know if that makes sense. Weekly momentum positive while monthly and daily are negative. Daily just flipped negative yesterday by the way. 120 ------------------------------------------------------------------ 118 X 116 X O Top 114 X O 112 X O 110 ------------------------------------------------------------X O -- 108 X O 106 X O 104 X 102 X 100 ------------------------------------------------------------X ---- 99 X 98 X X X 97 X O X O X 96 X O X O X 95 ------------------------X O X O --------------------X --X --X ---- 94 X X O X O X O X O X 93 X O X O X O X O X O X 92 X O X O X O X O O X Med 91 X O O X O X 7 X 90 --------------------X ----O --O --------------------X ----O ------

To: dennis michael patterson who wrote (12879)	7/22/1998 9:19:00 PM
From: Robert Graham	Read Replies (2) \| Respond to of 42787

I find that market tops of the short term nature can be called successfully anywhere from one to several weeks in advance. But the longer term market tops are very difficult to call. It is like trying to see a broad pattern out of the small day to day market action where there are so many variables to consider. This market is volatile and has thrown me a couple times at my attempts. Some people are very intuitive about the market. My father has been in the market for over 50 years. It has been literally decades since he has been caught in a market correction. He has always been out weeks in advance. He was out over 4 weeks in advance before the October 1987 correction. He saw evidence of it coming that far back. But he has never been able to explain to me how he does this. He just responds to what he sees. I think it has to do with how the stocks that he follows behave in the marketplace. If they start behaving uncharacteristic as a group, then this gets his attention. The only thing that makes sense to me as an approach to calling the longer term tops is Judy's approach at including the fundamental picture of the market as far as the direction it is taking. Even then, it is difficult to call when it will happen. Furthermore, even though I have seen evidence of an economic slowdown in process, there are industries that have come to remain strong which has been giving people the "warm and fuzzy" feelings of good things to continue to come. Perhaps one can make a qualitative call that there are distinct aspects of the market that is not right which can lead one to see the possibility of a top. But then attempting to place a time on it is IMO very difficult if not impossible. For instance, I do believe the market has never recovered from the last correction. We are not seeing a very healthy rally. Sentiment driven rallies like this are to be approached with great caution for the potential of reversals. Feelings as you know can be prone to irrationality and reversals. Tape reading and TA can help deal with this type of market, along with a well-defined system that favors discapline. When we broke down a very significant support just before the hedge funds moved us up before this rally, I knew the market would end up revisiting this area. I have rarely seen markets recover from that type of break down without a revalidation of support. But you add to this picture mutual funds that are turning more speculative with their vast amounts of money along with the speculative fever they fueled by the recovery in the techs, which is different than the overall fundamental picture of the tech industries, you have a situation where prices can still move up. The hedge funds did not help any by creating the appearance of strength right when many were thinking we were in the process of a significant correction. But the market bought into this. I thought the market would pull back right above 9000 which did not happen. The techs came alive with the fund money which attracted the anxious speculators who have been waiting for some time for this event. This was the match to the powder keg. We made it above the old 52-week high which is another area where the market can falter and pull back. Nope. Did not happen. The techs several days in a row rallied. Now look what has happened. I think we will know by lets say Tuesday of next week where we are heading in the near future. It may be up or down. I will say speculative fever like this will not go away this easily. But it looks like this market drop has done some technical damage according to Chris and I would not be surprised if it has undermined the bullish sentiment of the market which will come up at a future time. I think what Chris is verbalizing is his view that there are problems with the technical nature of the market that has not gone away since the last market adjustment. At every market drop he has appeared to see technical damage on the charts. This together with other astute market followers like Judy and Don may have provided the basis for his view of a market top in the works. But since I do not really know for sure, I can only guess. I would not be surprised if he and the others are right that a market top of a longer term duration is coming our way. I have seen evidence of this myself. But the big question is when. Bob Graham