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

To: Investor2 who wrote (12157)	4/27/1999 10:31:00 PM
From: Les H	Read Replies (1) \| Respond to of 99985

The Dow is already in a climax run similar to the Nasdaq 100 in January. The Dow's been above the top band of its 28-week AIQ trading bands (90% trading bands) now for 3 days. The Nasdaq was above it for about 4 weeks in early January before a 12% correction. No guarantee that it will last for 4 weeks here. This is a weird market. Today's Nasdaq 100 stocks had a broad number of sell signals similar to April 7 and March 19. 3/19 4/07 4/27 Stoch 9-3 2-12% 0-17% 0-12% Stoch 14-3 1-19% 1-12% 0-13% Stoch 21-3 2-16% 1-17% 0-14% 5d Wilder RSI 2-21% 4-11% 0-15% NDX peak 2121 2251 2283 NDX trough 1943 1967 ? percentage -8% -13% ? peak-trough days 3 7 ? No such broad number of sell signals in the broad market or in the S&P 500, as can be expected from the positive breadth. More rotation.

To: Investor2 who wrote (12157)	4/27/1999 10:55:00 PM
From: StockOperator	Read Replies (3) \| Respond to of 99985

I2, It's funny how a short term trader can look at a market one way and a long term investor another. For instance, you say that the major indices have NOT broken out yet, immediately after one of the largest six-month bull runs in all of history I would agree that there are some very big differences between the way most people on this thread view the markets as opposed to the guy (gal) who deducts $100 out of each check to put into his 401k. The guy that gets up every morning and checks the local paper to see how his mutual funds did, before he jumps in his car and fights traffic on the way to work. You are right. It is often in his best interest to take the long term view on things. However, most of us here choose to view the markets differently. First of all for many of us it is our main occupation. Many here will pay their mortgage each month with the monies earned by trading. Plus there are many that still work outside of the market but yet spend many hours studying and developing a strategy in the hopes of someday trading for a living. That in itself can take a very long time and great commitment. So I guess my statement was kind of funny when you think about it. I am sure many of the statements made on threads like these would seem completely foreign to anyone not familiar with the markets or should I say trading. As you pointed out, I believe it all boils down to time frame. After riding the markets for over 1000 pts in the month of April many of us will want to keep as much of those gains as possible, considering a pull-back here is a very good possibility. Our desire to catch each wave (trend) by trading either long or short (without reservation) is also what seperates us from the avg. investor. And perhaps "avg. investor" is not such an accurate phrase. I do believe people today are much more sophisticated financially than even a few years ago. So I am sorry to be rambling on but since I have your attention let me add that I would play it very defensively here. Here we are with the avgs breaking into new highs and the trends for so many individual companies are not complimenting those avgs. What bothered me most about today's trading was that only the DOW broke through it's upside resistance. The RUT, S&P and transports failed to break their key levels. In the case of the RUT that resistance was at 435.30 (Jan 99) on Monday it closed at 434.97. Today it hit a high of 437.65 but FAILED to break that level on the close when it closed at 435.16, when you consider that the DOW was up over one hundred pts, the INABILITY of the RUT to break and hold that level is indeed bothersome. We have come a long way this month so I believe the best way to play it here is to leave it up to the market. If it breaks those levels great. If not I would expect some sort of a pullback here. Besides I heard after the bell that the market responded rather cooly to AOL's numbers, which were right in line with estimates. So be careful here. Good luck trading. SO