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

To: Lee Lichterman III who wrote (9936)	4/6/1999 3:44:00 AM
From: HammerHead	Read Replies (1) \| Respond to of 99985

COMMENT: Remember the Mechanical Bull ride so popular in some bars during the late 1980s? It was almost impossible to keep from falling off the motorized beast. Today's Great Bull Market is doing the same to more and more stocks. At the end of March, 60% of the stocks in the S&P 500 sold below their year-ago price, the worst performance since 1994. Fewer and fewer stocks are driving the stock market averages into record high territory. There are three possibilities: 1) This is a bearish indicator. 2) It doesn't matter. If you are in the right stocks, like Yahoo and AOL, who cares about the losers? 3) The bull market will soon broaden, so small- and mid-cap stocks are the way to go. Take your choice. I pick Door #2 for now through a summer rally that could take the Dow to 11,000. During the late summer and early fall, I believe that the narrowness of the rally and the extreme overvaluation of the Nifty Fifty--or is it the Nifty Five?--will trigger a significant sell off (-30%). My bearish scenario assumes that investors will become concerned about Y2K, and will be disappointed by earnings. I have to concede that so far no one seems concerned at all about Y2K. There are far more people considering leaving their jobs so they can trade stocks on their home computer than survivalists preparing for Y2K calamity. SUBSCRIBERS: For more, see "Why Is The Rally So Narrow? " in the subscriber section of GLOBAL PORTFOLIO STRATEGY. If I'm right about earnings, you can watch consensus earnings expectations continue to drop over the rest of the year in EARNINGS FORECASTS WEEKLY. Are you wondering whether "Will Japan Recover?" Just by coincidence, that's the subject of our latest GLOBAL ECONOMIC BRIEFING. PUBLIC: A new feature is STOCK MARKET LAB, including our popular daily valuation model and calculator. There is also a section with daily technical indicators. Look for lots of additional stock market timing tools in the weeks ahead. MOVIES: "Affliction" was well acted, but a bit slow. "EdTV" is a noisy rip-off of The Truman Show. Dr Ed ****************** Please forward as appropriate. To unsubscribe, reply with REMOVE in the subject field. **************** Home: yardeni.com Weekly Audio Forum: yardeni.com Global Economic Analysis: yardeni.com Global Economic Briefing: yardeni.com Ecofax: yardeni.com Global Portfolio Strategy: yardeni.com Earnings Forecast: yardeni.com Global Markets Briefing: yardeni.com Stock Market Lab: yardeni.com <<<NEW!!! Y2K Home: yardeni.com Y2K Reporter: yardeni.com Y2K Netbook: yardeni.com Y2K News Fax: yardeni.com Y2K Action Day: y2kactionday.com Y2K Corporate Disclosure: progsys.com People Polls: yardeni ******************