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

To: Debra Orlow who wrote (3121)	12/30/1998 2:33:00 PM
From: StockOperator	Read Replies (2) \| Respond to of 99985

Debra, The argument against a continuation of this rally has been been how poor the internals have been, which I completely agree with. But I think in trying to call a top in this environment you have to look at the averages that are the weakest (Russ.-Trans.). If they continue to lag and or start to fall apart, they will eventually lead the rest of the market lower. So in trying to determine whats happening in those averages I pay close attention to the patterns that are developing on the charts. Right now those charts are still bullish. Granted, we are not out of the woods just yet. We still need to see a sizeable rally in all the averages that have lagged the NAZ and S&P. Look at today's action, despite the overall weakness, the Transports have been strong all day, with momentum actually building. The rosiest of scenarios here would be for the NAZ to take break (the oscillators are screaming for it) while the other averages play catch-up. Now that would be a nice divergence to see. Good trading, SO