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Strategies & Market Trends : The Millennium Crash -- Ignore unavailable to you. Want to Upgrade?

To: MythMan who wrote (3013)	7/27/1998 9:12:00 AM
From: Arik T.G.	Read Replies (2) \| Respond to of 5676

Hello Pete, >>My point is waiting (hoping?) for crash is a mugs game. A good point. I was wrong last year when I thought August 6th was THE top. I made a lot of $ riding down with the market that month, but lost more since. I had two scenarios- 1. The market has topped in August, and will continue down in a two years bear, to Dow 5000 or so. 2. The market will make one more leap up, to Dow 9200-9700 in the Spring of '98, setting the stage for the Millennium Crash. Last August, with the Dow at 8250, I thought that the market was way overvalued. Since then- MSFT almost doubled, DELL has tripled, AOL has quadrupled, not to mention YHOO and AMZN. Do I think they are now at fair value? I just missed how big this bubble can get. After the April 22nd top I thought that everything is ready for the crash. I compared charts with '29 and the April top looked like IT. But the just OEX traded rangebound for two months after the top, setting itself for the summer rally. But April 21st was THE top for the Russell 2000. This index is now down 20% from that top! Look at the chart of the Russell and tell me you want to buy that dip... It looks like the Russell just started last week on a steeper second leg down. In the three months since April 22nd, a handfull of stocks pulled the major indices up: the Daring Dozen in the OEX, plus LU, PFE, HD in the SPX, plus DELL,WCOM, in the NDX, plus 5-6 internet stocks for flavoring. Maybe 30 stocks altogether, that gave the appearance of a rising market. In the last three months, there were $50B flowing into mfs, which in addition lowered their cash levels by half a percent point, which equals roughly $25B. That gives $75B new money that went into selected stocks (let me guess- GE, MSFT, LU, and a little CSCO or DELL or HD or AOL). Why oh why did the Russell 2000 tumble 20% in that period (hey,I think this index contained YHOO and AMZN until recently)? The answer, I believe, is that April 22nd WAS THE TOP for the stock market, but not for those 30 something favored stocks. As for the crash, I'll state my opinion once more, for the record: It would be the biggest, meanest bear of the last 65 years. It will last over two years. It will decimate stock prices, including those considered "safe". The crash phase will be official when the SPX will break its 200 DMA, correct and fail to cross it back up. I believe that this will happen next September. JMO, BWDIK? ATG