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

To: Bull RidaH who wrote (23039)	8/2/1998 1:28:00 PM
From: Philipp	Read Replies (1) \| Respond to of 94695

David: Thank you for your analysis; I seem to have misread your underlying assessment. Your various resistance level will be very useful; they pretty much agree with the resistance levels I see in the chart. Once the 1070 (SPX) range is broken, I feel that the market may go into panic mode since this violates the buy-the-dip paradigm of recent years, and so I am not sure whether the otherwise strong resistance just below 1000 will provide more than a short respite. People are often comparing the present situation to 1987. It seems to me that the market now is much more overvalued than it was at that time. Therefore I would expect a 87-like correction as the minimum correction to be expected. Most crashes also seem to have more than one sharp leg down (often separated by an extended period with a flat or rising trend, during which the fundamentals deteriorate in part because of the initial decrease). Where do you and others see the really long-term support level? 550? 600? Cheers, Phil

To: Bull RidaH who wrote (23039)	8/2/1998 2:16:00 PM
From: Monty Lenard	Read Replies (2) \| Respond to of 94695

>>new lows exceed new highs within 4 trading days << David, did he say which side of the high or does it matter? Monty

To: Bull RidaH who wrote (23039)	8/2/1998 3:18:00 PM
From: Thomas C (Hijacked)	Read Replies (2) \| Respond to of 94695

David, great post, have a couple thoughts about it too... >But take a look at the '87 chart, and notice that prices didn't just >collapse from the peak. After the initial 10 % decline from the peak, >you'll notice that prices rallied back about 7%, then the crash >ensued. I have looked at the 87 prices like a thousand times by now. What concerns me though is that all of the gurus and others are becoming overconfident about the timing of when this crash will happen when it may be happening as we speak and catch them off guard when they are hoping for a strong snap back rally. This market will do whatever it wants to and do it in a way that catches people off guard. But specifically with regard to your comments on the 87 pattern. On the 87 pattern you can see what looks like the letter W. After the letter is completed the market falls in exhuastion. I kind of see a similar thing now. Early May98 is where the W starts and July 20 is where the W ends. And what do you know, after it ends the market falls VERY steeply just like in 87. So it very well may be we are days instead of weeks away from the BK. But I also favor the other arguments for a bounce off 200DMA as we all know the market cannot only go down in a straight line...or can it? tc

To: Bull RidaH who wrote (23039)	8/2/1998 4:13:00 PM
From: Daniel Ray	Read Replies (1) \| Respond to of 94695

<<A crash day 55 calendar days from the peak would have the market in free fall by Sept. 15th, with 790 SPX a minimum target. We'll see.>> Glad to see the reappearance of the 55 day rule on this thread. I myself believe the day will be Sept. 22, if it is to happen at all. History doesn't repeat itself . . . but there are always echos. Not being as skilled in the technical arts as most people here, I resort to a certain bigpicturearianism. . . . I myself am willing to accept that, in an environment where the U.S. is undisputed king of the hill and no real threats (?) loom on the horizon, and economic growth is stimulated not so much by cyclical upswings in old industries as by birthing pangs of new ones, the U.S. equities markets are fairly valued, in light of a clear shift in fundamental sentiment towards devaluing risk in the short-term. This leads me to suspect, if not believe, that the markets will find a new way, as they always do, to extract capital from weak positions. My scenario du jour has the markets in a trading range around fair value (call it the July highs in the indecis if you want) for an INDEFINITE period (years?) as corporate profits continue to climb. I envision a rotating market, where individual issues as well as market sectors would sell off and then recover; but the broader markets would remain in a range. I can see a fairly broad range here, but the important concept would be lack of long-term trend. If corporate profits increase, this would amount to a 'silent' bear market, and would extract lots of $$$ from anyone placing bets on a long-term trend. I do appreciate all the technical reads on this thread; together they are useful as a way to peer into the ultimate reality at the heart of things. Good luck to all!