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To: Thomas M. who wrote (31604)	4/8/1999 1:18:00 PM
From: accountclosed	Read Replies (1) \| Respond to of 86076

Tom, that is a very interesting mf flow fact. another picture of narrowness.

To: Thomas M. who wrote (31604)	4/8/1999 1:32:00 PM
From: John Pitera	Respond to of 86076

Martin Armstrong takes a stab at calling a top today some of his latest article Perhaps because humans become tired and are unable to sustain their energy without taking a break, investment behavior displays the same pattern. There are minor 8.6-month timing intervals that appear to reflect key decision points for investment. Twelve 8.6-month timing periods are contained within one major 8.6-year business cycle configuration. A review of the first 6 waves in the S&P 500 between 1994 and the present offer a guide as what we should expect as we approach the next such target - April 8th, 1999. II Getting down to the immediate future, timing models clearly show the potential for the month of April to produce a turning point. Likewise, volatility appears to begin rising with the week of April 12th. The potential for the April 8th target to produce a major high to the precise day is not necessarily very strong, but the fact that most serious corrections tend to appear around these turning points does at least warn that a 10-23% correction could be in the wings. Only new highs beyond April would suggest a rally into July or September later in the year warning that a major bubble top then becomes possible with all the implications for a serious decline between 2000 and 2002. An additional advance of 20% above current levels in 1999 would warn of a future decline in excess of 50% into 2002. One immediate concern for April 8th is none other than the issue of Yugoslavia. It is hard to ignore the high probability that the conflict in Yugoslavia is likely to get worse forcing ground troops to be deployed. Our sources on this matter state very clearly that NATO has never fought a war and as such there is a whole infrastructure in Brussels that would be without a job if NATO should collapse. There is no way to consider a victory at this point UNLESS the refugees are allowed to return. This contrasts against the government of Yugoslavia that sees this as their territory and merely a payback for the loss of this region to the Ottoman Empire back in 1389. In any event, this is not some Gulf War. The markets have chosen to ignore this conflict as if it were another video game. However, we see no sign that recovery for this region economically is even remotely possible until 2002. The odds of this conflict spreading are also very high as war always follows on the heels of an economic downturn. If the economy was sound in Germany following World War I, Hitler would never have gained power. The same is true in Russia. III We are also at a critical juncture where capital MUST now make a decision once again to buy or sell equities. New highs this week cannot be ruled out on Tuesday or Wednesday basis the S&P 500. The true issue will be sustainability. We simply need to score new highs beyond next week (April 12th) in order to see another surge of buying ahead. Lacking that buying surge on good volume, some sort of a correction becomes likely and the risks are now only increased for a near-term correction. Whether a high here during the first week of April turns out to be a major high going into 2002 will be determined by the magnitude of the decline. A correction that HOLDS above 1147, the first line of long-term support, could still be followed by new highs later in the year. This initial support represents a potential 14% correction. However, the primary support has now risen to the 952-941 area basis the nearest futures. A correction to this level would represent a 29% decline. Still, keep in mind that the 1987 Crash of 2 months represented a 43% correction and the market still survived. A correction that produces a monthly closing BELOW the 941 level will indeed warn that this correction will last more than 2 months, which has been the life expectance of serious corrections since 1987 including the last one from the July 20th high. A monthly closing BELOW 802 would be necessary at this time before our model would warn of a bear market into 2002. Keep in mind that a decline down to 802 is still only a 39% correction, which is less than the 1987 2-month decline. pei-intl.com