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

To: StockOperator who wrote (9613)	4/1/1999 1:05:00 AM
From: Compadre	Read Replies (1) \| Respond to of 99985

StockOperator: Talk about clues, the market may have given one today. I don't like the sudden volume increase today (3-31). I hope this is due to window dressing and not distribution. Regards, Jaime

To: StockOperator who wrote (9613)	4/2/1999 2:41:00 AM
From: StockOperator	Read Replies (4) \| Respond to of 99985

I know many have echoed the same fears this week of an impending break in prices. With the market internals continuing it's weak performance, being cautious is highly justified here. However, to make money in the markets as a TRADER (I emphasize that) you have to be willing to follow the signals that the markets are sending you. Especially when those signals are contrary to much of what you're hearing. Jaime summed it up well yesterday when he said "just let the market tell you where it is going rather than anticipating the move." Anticipating by itself will not get you in trouble. On the contrary, I believe it is something that most technicians do on a regular basis. The trouble comes when your actions are based off of your fear of what might happen rather than what prices are actually telling you. Of course I think it would be foolish to ignore what's happening in the broader market. Narrow breadth ultimately weakens the platform that any bull market will stand on. So I agree that today's market conditions do not make for a persuasive bullish argument. Especially when you consider those internals with the already parabolic rise seen by so many of the market leaders. So when I consider those segments of the market attempting to breakout into new highs or forge through key congestion areas, it really makes me wonder how high many of these stocks can go. I wish I had the answer. I realized long ago that fundamental analysis was not my strong suit. I doubt really if anyone can tell us where this market will be five years from now. Or what the impact of the internet might be to the economy five years out. That inability to foresee ultimately brings us right back to only what the market is giving us right now in the moment. And at this particular time I believe prices are going higher. Of course that unemployment report released tomorrow will surely impact prices. But when I look at what the market has given me up to today I have to believe that report will be positive for prices. Here are a few things to consider: The DOW, trannies, S&P, Naz and RUT all finished higher on a CLOSING monthly basis (March). In fact, despite the volatility, they've all closed higher on a weekly basis as well. Keep in mind that some of these indexes are poised to break into new highs or in the case of the trannies key congestion areas. The nutz and the bandwidth stocks have been on fire. Stocks like LVLT, RNWK, QWST are proving to be some of the new market leaders in the tech sector. Three weeks ago when I pointed this group out you could have purchased RNWK in the 90's - it hit 158 today. And believe it or not LVLT and QWST are STILL pointing to higher prices. With the nutz you have a group that has seen mixed performances so far. AOL and AMZN are clearly ahead of the group. This week we've seen some rumblings from some of the other players in the group NAVR and MZON are two examples. YHOO has run into major upside resistance. And the chart is saying it is now "do or die." Prices have set themselves up perfectly for a possible breakout here. Watch for a break of the 185 area on heavy volume. Many of the smaller players like ONSL, BAMM, AMEN, EGGS should also make moves with the group if I am right about this potential advance. We will most likely see some explosive moves. MSFT looks ready to go higher. CSCO looks poised to break into record highs. Both DELL and INTC also appear ready to make up lost ground. GE going even higher - JNJ higher - FDX ready to break six week consolidtion - DAL should be watch for a possible break into new highs. Stocks that I am a little concerned about would be MRK, GM and CMB need prices to firm here. So I get the impression that the tech's will lead this rally. Of course it is important to wait until we get those clear cut signs before initiating new postions. If for what ever reason I am wrong. Like perhaps the bond market doesn't like the employment data. Any possible downdraft could be swift. I say that because prices are already pointing higher. Therefore any downward move would go counter to the trends that are already established. Once again this is only my read on things. Only the market really knows what it's going to do next. Have a great weekend. SO