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

To: James F. Hopkins who wrote (12304)	4/28/1999 9:28:00 PM
From: American Spirit	Respond to of 99985

Goldman Sachs is also underwriting the BNBN (BKS) IPO in about ten days which should be HUGE. A great buy now, by the way. It's at its base and will zoom.

To: James F. Hopkins who wrote (12304)	4/30/1999 2:29:00 AM
From: James F. Hopkins	Read Replies (3) \| Respond to of 99985

Golly Where have I been, Well any way here is the dope on the DOW ------------------------ -------------- Below is a chart of it as the DOW stands, several charts. Using the TOP 8 market cap and most liquid stocks in the DOW 30 look at the way I listed them on in the url, as they are in descending order cap cap wise. Ranking them 1 2 3 4 etc. It may be hard to see there are so many lines on it, But YTD Only Two of the TOP 8 are over the index..and C #4 is way the hell up there ...Wmt #3 is also above, BUT we have 6 major stocks below "it's own index" , I picked this Head/tail thing up back in 97 after that OCT correction and have tested it no end. quicken.excite.com IT showed it then and if you keep up with the market caps, it will show it every time, when the correction come, the index falls down through them and in that way they find them selves above the index. In short liquid finds it's own level , and look at it from the angle that "the index moves" on both sides of it, it's trails the liquid, sometimes by a good margin, but the more the divergance the more the move when it hits. Just shade treeing it my guess is a composite of those stocks, would put the index about 8% above the liquid right now, how much she will take I don't know, but there is about a 8% correction built in at this time, and the more those bigs ones ease below the index the more correction we will have, hmmm but it also over corrects when it does so we could see as much as a 15-16% drop in the dow before much longer. bring it in closer we have apx 35% above to 53% below the index using the top 8 stocks. the real liquid is in GE..1.5 X more again than xon or wmt. or rated them this way GE 3.52 ; xon 2.05 ; wmt 2.01 ; ibm 1.88 c 1.72 ;ko 1.67 t 1.67 mrk 1.66 quicken.excite.com ---------------- on the other end Keep in MIND with the DOW the thin ones effect the index JUST as much per $ as the big ones , hence They being MUCH thnnier trade actually can make the Index move faster than the liquid ones do ..THE Tail rated by market cap the same way is Uk .06 ; gt .08 ; ip .17 ; s .17 ; aa .24 cat .23 jpm .24 & Ek .25 dig it THEY total 1.44 all 8 put together are Less than the smallest one in the head MRK, < Yet these dudes move the index just as much as the top 8 SO picture the index getting in high gear when these babies trade up or down , and it's cutting a path through the liquid level of the top 8...what causes the exuberance & the panic runs is when these decide to really trade then all eyes on the index say O shit.. quicken.excite.com The tail has been taking the index up a hell of a lot more than the head, the only one really below it is S, Look at AA CAT & IP , now for this to balance GE would have to go up about 30% , and it better real soon. Maybe the mid section can put some balance to it, how ever I thinks the index will adjust down to or below the major players, and when it does the little guys will do the trucking. But I won't play the stocks, just a short margined almost to the hilt using the DIA spider when the tail starts down. It would not surprise me at all to see the Dow fall back to 10200..and it won't because I'll be watching this tail. It amounts to stocks with smaller floats move up/down much faster, than stocks with big floats , and index wise the Dow is as cake walk as it is not cap weighted, but price weighted..the tail really whips the index on both sides of the head. ( liquid ) Normal TA does not show this worth a flip , not even close, & it's not the TA it's just the way the index is. Jim PS I never have bought TA on an Index all that much as an Index is not what it seems to be..price weighted indexes are pushed around with the thiner trasded stocks, Cap weighted are not so bad, but most are Top heavy... like the BIGGEST caps push the index yet a lot can be going on inside that latter makes for a surprise adjustment.