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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: jjs_ynot who wrote (200)	12/3/1998 6:42:00 PM
From: donald sew	Respond to of 99985

INDEX UPDATE ============================ Well the DOW corrected 5.3% already which fullfilled the premise that if the NEW HIGHS stayed below 100 and NEW LOWS between 10-50 for a month, which it did for NOV, then there would be a 5%+ correction the following month. There was a 2 day spike on the NEW HIGHS above 100 to about 120, so that was only a overshoot. Now where do we go from here. Per my previous updates I was suspecting another STAIRSTEP in which the following rebound could be weak and where the DOW trades in a ZIG-ZAG pattern within a range which is below the all time highs of 9380. The NAZ/HITECHs are still in the overbought range, while the DOW is now a CLASS 1 BUY at tomorrows lows. Since my system is not price orientated, but is time orientated I can only say that the next strong support line is at 8750. Originally I did not think it would get that low, but with the DOW breaking 8900 to the downside - its possible. Since there is a strong divergence between the DOW and the HITECHs/NAZ there are a few possibilities: 1) DOW moves up and pushes the HITECHS back up 2) HITECHS/NAZ moves down and pushes the DOW down further 3) DOW moves up some and the NAZ comes down some to narrow the divergence. 4) DOW moves up and NAZ remains flat 5) NAZ moves down and DOW remains flat This pullback in the DOW has been faster and stronger than I originally expected, but that is not to say that we will not get a pop to the upside. However the upside should now be limited and feel that the max should be the previous highs of 9380 if it gets that high. I am still sticking with my position that there will be an upswing after tomorrow which should last 4-6 days, but will not be smooth and should take a ZIG-ZAG pattern. I believe that we have set a mid-term top(30 days) at 9380, and that this forthcoming upswing will produce a LOWER HIGH, which would imply that the market could either change to a downtrend or a range trading trend. One of the factors that hints of a mid-term top is the selling in the internuts. Even with the strong European rate cuts, their major markets did not show alot a strength today. Subjectively, I feel that even a future rate cut in the U.S. will get similar results(depending where the market is at the time). Of course there is the possibility that the market heads straight down which is less likely at this time. As I have felt for some time, the KEY to future movement could be the forthcoming rally. If it is weak, it could be an ominous signal for the future. Seeya

To: jjs_ynot who wrote (200)	12/3/1998 8:40:00 PM
From: Patrick Slevin	Read Replies (1) \| Respond to of 99985

My machines are all off. I can run out new numbers in the morning if you like. Anyway, it really depends somewhat on Globex. I don't use normal support and resistance numbers you will find on charts; I am more prone to review most recent action to try to get something that I can be comfortable with. It flies in the face of normal analysis, but I have a contrary bent. Each morning I try to come up with targets based on the prior day and the Globex action and, right or wrong, I completely ignore where the gaps have to be closed and so forth. So if you like, I can come up with a guess in the morning.