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

To: Compadre who wrote (12837)	5/4/1999 10:13:00 PM
From: StockOperator	Read Replies (1) \| Respond to of 99985

Jaime, Sorry it has taken so long to get back to you. I recently purchased a new house and it has taken all my time this weekend. So far I haven't had time to catch up on the post's during the last couple of days, but here are a couple of observations that caught my eye. As you say the NAZ and NDX are in extreme oversold territory. The test of the 55 day EMA may indeed be a buying opportunity but I would not be preemptive here. First of all let me say that I completely missed today's selloff in the NAZ. Trying to do too many things at one time will dramatically affect your performance (almost never positively). Despite the big day yesterday for the DOW the NAZ failed to close positive. Something I completely missed. Of course today's index action is already old news, but I would say that things are just teetering on the brink of a major trend change. In other words if the NAZ is going to rally it better do so in a hurry. I say that because the weakness in the NUTS is beginning to spill over into the broader tech sector. Many stocks that I follow are sitting on the edge of a cliff here (MSFT is a perfect example). Their intermediate term trends has seen much deterioration. Of course all of this is happening on the heels of a major move in the DOW. A BULL TRAP??? Definitely worth keeping an eye out for. The key thing to watch here once again is the interest rate environment. Rates are definitely moving up. The thing to ask ourselves here is how will the market respond to rates possibly hitting the six percent range? Personally I don't believe rates will go much higher than that and indeed this rise be ultimately prove to be short-lived. However, I do believe rising rates could cause some sort of retracement. Good luck trading. SO