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

To: donald sew who wrote (3226)	1/3/1999 7:39:00 PM
From: Ramsey Su	Read Replies (1) \| Respond to of 99985

Donald, Just heard the other day that we now have over 9000 mutual funds. It seems not so long ago that we had less than 4000. Could the number of mutual funds and the amount of funds under third party management be forever changing tried and true TA techniques? Online trading is another major change. With so many investing like playing a video game, what impact does this group of investor or traders have on old TA indicators? I have been trying to watch the AMG data fund flow and have yet to find any significant correlation (probably more because I have forgotten all the math stuff from college than an actual lack of correlation). I guess I am just wondering if we need to include some new indicators which will take into account the mutual funds and the online traders. In the mean time, the dollar just dropped below 113 yen and the Nikkei opened down 2%. Ramsey

To: donald sew who wrote (3226)	1/4/1999 10:52:00 AM
From: Robert Graham	Read Replies (1) \| Respond to of 99985

Money is placed in money markets as a holding place. This is considered the same as cash. This approach is used to weather very short term dips in the market. IMO the important question is where did the money go that was taken out of the money markets: bonds or directly into stocks? I have not been following the market for a period of time now, so someone else is better suited to attempt an answer to this question. If the money is moving into stocks, then this may be part of that money "sitting on the sidelines", which some here have talked about, that is now being comitted to the market. So one way to look at this is there are basically three places for money in the market that most of us here follow: equities, money markets, and bonds. Both money markets and bonds compete with equities for the investment dollar, and each has its use. Money markets are used as a short term holding place for money from profit taking and to weather short declines in the stock market. I think money moves into "premium" bonds when a longer correction is anticipated. Fear would be the motivating factor here. Just some thoughts of mine. Bob Graham