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

To: HairBall who wrote (11362)	4/18/1999 7:32:00 PM
From: donald sew	Respond to of 99985

Larry, >>>> One of the trend lines has to give it up soon. As, the DJI stuck its head above the upper trend line of its very long-term rising trading channel some may interpret that as the beginning of a breakout. Or, some may interpret it as an over shoot before a pull back. <<<<< Without confirmation the initial assumption should be to the upside. When checking your charts it appears that the NAZ also broke a trendline, but to the downside. So in the same line of thought, without confirmation the initial assumption should be to the downside for the NAZ. Trying to look at it objectively and specificly addressing your question of breaking the trendlines, if one makes the initial conclusion that the DOW is heading up since it broke the trendline to the upside, one also has to conclude that the NAZ is heading down since it broke the trendline to the downside. This is of course not taking ANYTHING ELSE into consideration, just SPECIFICLY the breaking of the trendline. Now, the question is - and PURELY based on the trendline breaking, which sector will lead the market. Will it be the ex-momentum leaders, the hi-techs leading the market to the downside, on the premise that they broke the trendline to the downside and will continue to the downside, or will it be the NEW EXCITING CYCLICALs/BASIC MATERIALs leading the market to the upside, on the premise that they broke the trendline to the upside and will continue to the upside. Just trying to look at it logicly and sticking STRICKLY to the issue of the trendline breaking in either direction, and not taking any other issues into consideration like interest rates,liquidity,earnings. In light of this seeya