Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Jay who wrote (13542)	8/1/1998 4:15:00 AM
From: Robert Graham	Read Replies (1) \| Respond to of 42787

First off, I do not think we should be too alarmed about today's price action. We are in a type of consolidation pattern on the DJIA that is unusually volatile. There has been more damage to sentiment by this last move down than the technicals of the index. However, I do not like the close dipping lower than previous closes, along with the lower BB moving down as this happens. The 20 day EMA has been downward sloping, but now the 50 day EMA is just beginning to do the same. However, the Stochs appears to be crossing its signal line for a buy signal. I think this call on the Stochs is still a bit premature. I definitely do not like what I am seeing on the charts. Normally given negative sentiment like this, a consolidation pattern with volume remaining up, and some key stocks at their supports, I would say the market is going to move up from here. But much is different this time around. The trading action from both an intraday view and on the daily charts is not healthy at all and show an underlying weakness with these stocks, some of which have their technicals that look to be beyond a point of recovery for the short term. There still are stocks is fair shape like YHOO. IBM looks to be doing the best. MSFT looks to be breaking down and if it continues, this bellweather will get the market's attention. In general I am finding on multiple stocks a widening of the consolidation price pattern which includes lower lows, even on the stocks that are still holding up. This is definitely not a good sign to me. Even IBM is starting to show signs of a pattern of profit taking. Still, this call on IBM is premature. DJIA looks like it may move up from here, but both the S&P 500 and the NASDAQ look like their not in good shape and may be heading down. I would not normally be concerned by this disparity except that it is some of the NASDAQ stocks that are helping to keep the market from further losses, and the S&P 500 is a broad market index compared to that of the DJIA. I think the key here will be placing the proper context in place. Once that is done, this information can be correctly interpreted. My thoughts on this subject is that there is currently a downward bias to the market which has not gone away, and the trading action in the market has definitely changed from what I have seen in the market previous to this point in time. Sentiment has been becoming more negative with visible reason to be. I think what we may be seeing is a prolonged breakdown by the market. This started as evidence for a breakdown over the longer term in the form of what some are calling a rounding top. Now I think we may be seeing it take place now over the shorter term. This blowoff end to this latest rally I think may have accelerated this breakdown in the market. When we start seeeing the demise of stocks like YHOO, this will be the beginning of another downtrend of the market. Look at what has already happened to AMZN. Just some thoughts to ponder for over the weekend. Perhaps we can talk about this over the weekend? I do think the market is at an important juncture right now. Bob Graham