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

To: donald sew who wrote (22586)	7/28/1998 4:12:00 PM
From: HairBall	Read Replies (2) \| Respond to of 94695

Don: Market action at the close, was rolling over. I expect follow through to the down side Wed at the open. Now lets see what happens overnight! Regards, LG

To: donald sew who wrote (22586)	7/28/1998 5:01:00 PM
From: James F. Hopkins	Read Replies (2) \| Respond to of 94695

Donald; What seems to be coming to me now, is to keep an eye on the small caps. When the money stops rolling out of them and they hit a good bottom, then internals have the chance of improving very fast, as long as the small caps are sinking then internals can't improve, the rally yesterday was money going from small to large , that won't produce a rally that will hold. BUT if small goes up at the expense of liquid that won't work either. To sustain any rally we need them both moving up not one at the expense of the other. I think the small caps which are now at a loss for the year, will be the ones to send the bottom signal. -------------------- I heard on CNBC ( and it gripes me to give them credit for anything worth while ) but it's likely true. People are calling in telling brokers to take them out of small cap funds and put them in large cap funds. I think that shift has to finish it's move, then we can see better internals. So far liquid has saved the huge sell off, but still taht 1120 area better hold. About the time that shift finishes then small caps have a chance and them not being very liquid they will also run up fast, that phase gets noticed after a while and the same sifters shift back, but behind the curve , yet pushing the small caps up this time at the expense of the liquid and we go into the last phase where the small caps are going up and the mega caps start slowly sinking. Then some fund mangers rush for the exit, followed by more and more, and the market pops down. Right now the small caps have not found bottom yet and I think that needs to happen before we can start a real leg up. But I'm long and holding unless the total thing breaks down, I think overall the funds have cash , and people are not actually into pulling out of them. Jim