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

To: Ramsey Su who wrote (12302)	4/28/1999 9:41:00 PM
From: stockycd	Read Replies (1) \| Respond to of 99985

Ramsey, I agree with Don and others here that the I-nuts have been the momentum leaders for this market and when they reverse, the market will reverse. AMZN just "PUT" the icing on the cake. We have all been looking for a BK selloff trigger--well this is probably gonna be it. Most of the techs made lower highs this week (DELL and others). It's not gonna be pretty... Chris

To: Ramsey Su who wrote (12302)	4/28/1999 9:59:00 PM
From: bearshark	Respond to of 99985

Ramsey: It is primarily the fund managers that I fear in the INDU stocks. However, there is a good deal of interest from the non-block players too. Last week's one-day 22-point move of IBM was astonishing. I think the second or third day of its move was 12 points. Overall, it moved around 40 points in a few days. Today, we had 5-point and 6-point moves in the INDU stocks--and nothing really was going on. To put this into perspective, let's imagine something significant happens. Let's assume Boris Yeltsin dies and it is announced at 10 PM Eastern U. S. time. The new Russian leadership mumbles something about calling a moratorium on Russian debt during the night. The fund managers, accustomed to trading the INDU stocks, decide to dump them the next day. So, at 11 AM the INDU stocks are down by an average of 4 points each. That would be a total of 120 points (430). Then we use the multiplier (1204.5 or so) and get a morning decline of 540 points. Lunch comes and the market recovers because the morning wave of selling is over. However, we did not recover much at noon and the afternoon selling starts again at 2:30 PM and continues until the close as it picks up steam. So by the end of the day, the average INDU stock is down an average of 7 points. That equates to a 945 point decline for the day. If IBM can move 22 points up in a day, how far can it move down in a day? If some of the other slug stocks can move 5 and 6 points during a little buying spree, what can they do in a panic? A tremendous one-day drop is now possible because we are all trading.

To: Ramsey Su who wrote (12302)	4/29/1999 12:15:00 AM
From: marcher	Read Replies (1) \| Respond to of 99985

Ramsey, >>the scary part about the DOW wild swings is the thought of who is responsible? I don't think day traders, in the aggregate, have enough money to be swinging these huge caps.<< I've been wondering the same. My guess is that Asian money is a large part of the net phenomenon. Seems that Americans are too individualistic to jump on that bandwagon so consistently...we gotta "do it my way" (Frank Sinatra?) -g- It would be interesting to know just how much money newbie daytraders are trading. Best of luck --Marc