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

To: Kona who wrote (33273)	11/8/1998 2:59:00 AM
From: JBL	Read Replies (2) \| Respond to of 94695

IMO, people should forget about TA for a while. Whatever Wall Street does during the next few days, there is absolutely no way that Asian and Latin American markets are going to follow this rally much longer, and these are the real driver. I think we've had a relief rally that went bezerk, and the gloomy reality will soon set in again.

To: Kona who wrote (33273)	11/8/1998 7:52:00 AM
From: Monty Lenard	Respond to of 94695

HI Kona, the last I heard from Jim was he was playing the Dog Races. :-) Here is a privy message he sent me about a week ago concerning his THEORY on the small cap rally. I am sure he will not mind me posting it here since he posted the same thing a while back on the thread. "Hi Monty; the crash comes after small caps go up, BUT big caps go down, yet the S&P in general looks good, as the smaller ones hold it up, as the large caps sink. This is not happening yet, but if it does the market loses liquid. It's when the market loses liquid by having a rally in "thinner" traded stocks that sets up a situation, for hard down moves, as when the try to get profits out of the thinner traded stocks they find they drop fast. So in short it's not just a small cap rally that does it, it's when the market loses it's liquid, they window dress the portfolios with fast moving thinly traded stocks going up, as they rotate the money, instead of just using NEW money..it takes NEW money to make a real rally not rotation. Most new money has been coming in via the working man plugging into retirement , if unemployment comes that screws that up, yet the right wing is terrified of full employment, while they reward job cuts moving from bonds into stocks to create a rally it's not the same as new money. OLD money doesn't help the market in the long run, only new money. This can take some time to play out, but if the super caps go down at the same time small caps go up, you want to run like hell. ------------------- Same thing in the Dow, the top ten in the Dow are effected by the S&P mo mo..and the top ten are 4 times more liquid that the bottom 20 put together, if you think liquid, you can see that if the Dow goes flying up thanks to the bottom 20, while the top 10 are easing off, then it becomes less liquid. Right now it's very liquid, and that has not happened, but that's what to watch for. Jim "