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

To: bobby beara who wrote (34551)	11/28/1998 1:44:00 PM
From: donald sew	Read Replies (3) \| Respond to of 94695

Bobby, >>>>>>> People are putting their money where their mouth is and calling Dow 10,000 a lock -g- Add in a feeding frenzy on BAMM BAMM -g- and divergenges in breadth - non confirmations in transports, banks, russell 2000, earnings warning season, we have the makings of some sort of top. <<<<<<<<< Frankly, I am surprised at the bullishness of those I speak to, since it appears to be even more bullish than in the spring and early summer. Many of those who did not get out in JULY in the 9300 range, are now even more reluctant to sell. They appear to be even more bullish and less willing to talk reason now than back in JULY. Most of them say that EVERY BIT of BAD NEWS is incorporated into the market, and that since the FEDs is so powerful and will not let the economy fail the market is going straight up. I have notice their strong confidence that the market will continue much higher to the 10000-12000 range, which is far stronger than their confidence in JULY. This has to be extreme bullishness. I agree with you that statistically, extreme bullishness, non-confirmation of transports, rut, etc, and lack of confirming relative strength in the market internal (as you mention divergence in breath) are developing an environment of some sort of TOP. seeya

To: bobby beara who wrote (34551)	11/28/1998 3:14:00 PM
From: Just_Observing	Read Replies (1) \| Respond to of 94695

Problems with the Put-Call Ratio All analyses based on the Put-Call Ratio assume that investors are buying the puts and the calls. The open interest does not provide info. as to whether investors are long the calls or short them. So given a situation with a 3-1 call-put ratio, it is automatically assumed that investors are long the puts and the calls. However, this scenario is only one of four possible scenarios. They are: 1. Investors long calls and long puts (usually assumed) 2. Investors long calls and short puts (even more lopsided to the bullish side) 3. Investors short calls and short puts (somewhat bearish investor sentiment) 4. Investors short calls and long puts (very bearish sentiment). I wish that when open interest figures are provided, we could find out whether market makers are short the calls or puts (as is usually assumed) or they are long puts and calls. Does anyone know how to find out whether the open interest reflects whether the market makers are short or long? I would appreciate any help in this matter. Regards