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

To: StockOperator who wrote (3563)	1/9/1999 1:03:00 PM
From: Stephen	Read Replies (1) \| Respond to of 99985

SO ... with many of the sectors showing large percentage gains already for the year, if anyone is looking for 20-25%

To: StockOperator who wrote (3563)	1/9/1999 1:37:00 PM
From: bobby beara	Read Replies (2) \| Respond to of 99985

SO, We must question this broadening out effect deeply and look under the hood at the internals. Yes we have seen price breakouts in the RUT, TRANS etc. however the nyse a/d line has yet to take out it's downtrendline from the April top. The Nasdaq a/d line is much much worse and where the divergence is glaring we are getting top blow-off volume and peak bull market speculation in NUTZ. Find a NH/NL chart of the Nasdaq and draw trendlines from October 97, this market is riding on the backs of a few. Too many t/a's are spec'ing the market based on the NYSE. tHe Nasdaq has taken over the volume leadership and should be inclusive in any technical analysis. I agree you can't fight the tape and I am playing nutz stocks, but eventually there will be a pay/back for the cboe put/call hovering around .5 for almost 2 months now. That will be sooner rather than later - IMHO. >>>However, my work says that there's pretty good resistance at the 6 to 6 1/4 area. <<< High rates are bad for stocks. These lofty valuations are based on no inflation and low rates. Greeny is printing money like crazy and we have super low unemployement - what will result? The shorter term bond charts (fvx) are breaking down even more. Thats not to say that we could have another final push up in the bonds from a sell-off in equities. We were the only game in town as a reserve currency - the monopoly has been busted and I'm sure central bankers would like to not have all eggs in one basket. bb