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

To: Lee Lichterman III who wrote (969)	12/8/1998 8:57:00 PM
From: HairBall	Read Replies (1) \| Respond to of 99985

L3: Funny how different methods wined up in the same place...<g> Regards, LG

To: Lee Lichterman III who wrote (969)	12/8/1998 10:20:00 PM
From: dennis michael patterson	Read Replies (1) \| Respond to of 99985

Jerry Favors Analysis - Tuesday, December 8, 1998 8 p.m. At the lows early this morning the Dow was down as much as 54 points. The Dow then rallied and at the highs the Dow was up almost 17 points. The Dow then turned back down this afternoon and at the lows the Dow was down as much as 123 points. We closed down 42.49. Our work suggests some further pullback is probable short term. But there is no reliable signal just yet that we have seen any sort of important top. The Nasdaq at the highs today was up as much as 20 points, the equivalent of a 90 point rally in the Dow. However the Nasdaq closed down 5.89. The Transports at the highs today were up as much as 50.34 points, the equivalent of a 146 point rally in the Dow. The Transports closed down 10.38. We must allow for some further correction in the Dow short term. If the Dow had closed up today we would have gotten buy signals from several short term indicators, however the Dow closed down so those signals were not given today. They could still be given tomorrow but to this point the Buy Signals have not been given. So at this point the Dow could rally very short term but not necessarily prove the next wave up is underway. Any rally above 9089 on a print basis in the Dow tomorrow will signal higher prices, at least short term. A decline below 8964 on a print basis tomorrow morning will signal a test of 8946, and if 8946 is broken lower prices will follow,at least very short term tomorrow. Short term traders we will hold positions with the same stop.

To: Lee Lichterman III who wrote (969)	12/8/1998 10:21:00 PM
From: dennis michael patterson	Respond to of 99985

Lee, check this out: THE TECHNICAL REGISTER By Mr. Chartist December 8, 1998 NASDAQ FULL SPEED AHEAD? While the DJIA struggles to right itself from last week's tumble, the NASDAQ failed to confirm the weekly hammer and shot ahead to a new record. The bulk of Monday's gains came from the powerful NASDAQ 100 stocks, which include the likes of MSFT, DELL and INTC. That index established a record high on November 17th and speeds ahead, as if in some race with the much larger composite index. The NASDAQ 100 stock index stood at 1676.89 after Monday's trading, compared to the NASDAQ Composite's 2040.64 close. YTD to the NASDAQ composite is up nearly 30% while the NASDAQ 100 stocks are up by nearly 70% from the first trading day last January. Something major is in the offing. The NASDAQ 100 stocks experienced a weekly EMA crossover/uptrend on November 8th, the DJIA crossed over on the week of November 22nd, and the NASDAQ composite crossed over the week of November 29th. These are symptomatic of yet another major upward move in the markets. The EMA support levels continue to point at 60 degree angles in the NASDAQ indices. RECOMMENDATIONS Compaq Computer (CPQ) is doing just fine. Those of you who missed the Monday rally may wish to bet on another up day for CPQ. There may or may not be a consolidation day in either Tuesday or Wednesday. For now, this is purely a momentum play - CPQ January 45 equity call options (CPQAI). Cisco Systems (CSCO) continues firing on all cylinders. It also experienced a weekly confirmation failure on a hanging man. This should lead to another rally in this stock. The favored equity call option is the actively traded December 80 call (CYQLP). A lot of options traders opted for the December 70 DELL calls on Monday, making this the most actively traded option. Closing at $1.50/contract, its next candlestick resistance level is at $2.50/contract. DELL has been lagging the rest of the NASDAQ majors. With Monday's trading, DELL entered the second window of its November 11th - November 30th retreat. That resistance level stands at $69-1/4. The first window of resistance stands at just under $72/share. If this rally builds up more steam, this week, with no political obstacles, then DELL should set a new record and reward those options speculators betting on DELL's continued rally.