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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club -- Ignore unavailable to you. Want to Upgrade?

To: Boca_PETE who wrote (1549)	10/10/1998 8:14:00 PM
From: Nicholas W. Paizis	Read Replies (1) \| Respond to of 15132

I haven't been able to get to a radio today. Any more info on Bob's comments today would be much appreciated. Nick

To: Boca_PETE who wrote (1549)	10/10/1998 8:18:00 PM
From: DD™	Respond to of 15132

A TA Perspective from a Noted Market Technician Victor Weintraub October 10, 1998 Excerpt.. SHORT TERM RATING: 5 UNATTRACTIVE INTERMEDIATE TERM RATING: 5 UNATTRACTIVE Continued deterioration. "If you just look at the performance of the DOW you would have no clue to the horrendous performance of the Stock Market last week. You would think that it was a price volatile week and that the market finished up. Nothing is further from reality. Last week the DOW did gain 114.83 points (1.48%), everything else fell apart. The S & P 500 lost 1.82%, the NASDAQ lost 7.58%, the S & P Mid Cap lost 5.26%, the Wilshire Small Cap lost 8.97% and the Russell 2000 lost 8.95%. It is again like the Phantom Rally of last summer where a few large cap growth stocks masked a topping market. This time they are masking deteriorating market internals. Market internals were awful this past week. The Advance-Decline line was negative by a daily average of 899 issues, a very big and very negative number. New lows expanded dramatically and averaged 509 daily, again a huge number. New highs averaged 60 for the week and shrank to 13 on Friday when the Utility Stocks had a weak day. Volume was very heavy and expanded to 1.1 billion shares on Thursday, a day when the A-D was negative by 2,036 issues. We are seeing declines on heavy volume and rallies on much lighter volume. Intra-day price swings continue to be wide. I do not see much positive in the market at this time. Market internals are very weak and not showing any resilience. The small cap averages are again leading the decline. A snap-back Phantom Rally late last week in a few large cap stocks in the DOW and to a lesser extent in the S & P 500 are masking the continuing deterioration of the market. It is worthwhile to take note of the NASDAQ average. It is dominated by a very small number of large cap tech stocks. This average broke down badly this past week illustrating the further narrowing of stocks that are fighting the accelerating down moving market. It is my judgement that the market is extremely vulnerable and dangerous at present. We are most likely setting up for another large down move, another waterfall. The DOW will penetrate the 7400 level the question is when. I will be on CNBC on Monday and the market seems to rally whenever I am on so my guess is Tuesday, always a good day for a debacle. I have recently been commenting on the sensitivity of our markets to the foreign markets and this situation continues. In Japan the Nikkei average finished the week at a new low although it did rally some mid week. The weakness of the Nikkei has been a compliment to the weakness in the major European markets. They are all a drag on us and visa versa. Where is the bottom of this down move? The small cap averages, the Russell 2000 and the Wilshire Small Cap are already down almost 40% from their highs made back on April 22. A 40% decline in the DOW from it's intra-day high of 9367.58 on July 20 would put it at about 5620. A decline of 40% for the S & P 500 would put it at 710. These are not hard numbers but a 30% to 40% decline for a bear market is not unusual. The problem that this market has is that it is facing a weakening economy and of course that translates into flat to weakening earnings. Also, this Bear Market started from historically high valuations. What is driving the market is a double whammy. Contracting price/earnings ratios and declining earnings. The longer term future of the market will depend upon how individual investors take the pain of losses. Nobody knows the answer to that question. If you are a speculator or trader I think you should only look for opportunities on the short side. My advice to intermediate and long term conservative investors is that the market is still very highly priced and over extended and we are in a BEAR MARKET. What we are seeing is contraction of very high price to earnings multiples. Prudence dictates the sidelines for those concerned with capital preservation and those who are cognizant of risk verses reward. This is a high risk and expensive market. If you are still in the market you would be prudent to consider a hedge position. A little insurance is worth the cost in times of high risk." firstcap.com DD