Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: John T. who wrote (13044)	5/7/1999 8:20:00 AM
From: Les H	Respond to of 99985

Thanks. Bookmarked. FORTUCAST FINANCIAL TIMER PRECISE TIMING AND MOVEMENT ANALYSIS BY BARRY ROSEN "Serving Futures Traders Since 1987" UPDATED MAY 5 FOR MARKETS OF MAY 6, 1999 STOCKS and JUNE S & P e-minis WEEKLY CHART TREND: Topping in May. DAILY CHART TREND: Topping. TODAY'S EXPECTED DIRECTION: Higher. NEXT HOURLY CHART NEXT DAILY CHART NEXT WEEKLY CHART TURN: 5/6-7 H TURN: 5/13 L TURN: 10/99 L POSITION TRADING STRATEGY: Sell June e-minis at 1365 and 1370 with a 1393 stop. Use any rallies to accumulate shorts in the RYDEX URSA fund or leap puts into the Year 2000 or put options with an October or November expiration. Our ideal entry would come from a rally anywhere between 1365-1370 on the June S & P futures. There may be a second chance into May 21. (05/06) Hourly stochastics turned back up and the speculative bubble cycle is at work and could even bleed into early Friday. Short-term patterns suggest a rally to 1359, a pullback to 1351 and then a new high to 1367-1371. Day-traders probably should focus on buying the 1351 region and risking about 7-8 points while position traders should be thankful for this rally and chance to accumulate major shorts. There is a 10% chance for a new high at 1388 but we are skeptical. Watch for resistance on NASDQ cash at 2550 and on the DOW at 11092. BIGGER PICTURE (5/6) At the moment the breakdown area on the DOW is 10800 on a closing basis, and once that happens, we may have a top in place. The DOW probably will squeeze out one more new high into Thursday, but the other indices probably do not have much of a chance. Use rallies to start accumulate shorts using minis, long-term options out to October, leap puts, and short mutual funds. Finding a perfect entry on the futures may be possible on Thursday as patterns unfold. OVERALL: One more high on the DOW and a failed high or slight new high on the S & P will create a pattern off of the October low and probably major weekly and monthly chart highs also. Continued divergences in NASDQ and the broader market are screaming to funds managers to take profits and we continue to recommend that you do also. First downside for the DOW will be 9000 and then eventually 7400 when the messier problems emerge this summer. CYCLES: Look for a top this week, the first fall into about May 13 and then a recovery into May 21, followed by a larger fall. The media will probably not realize what hit them until mid-June. LONGER-TERM: (4/27) It will take one more new high on the DOW to make a stronger case for a pattern completion off of the October low. Weekly chart patterns are even suggesting a chance of a move to 11091. Once we do top, a fall is inevitable, and DOW 7400 appears to be the mostly likely target this summer. I do not think we will see such levels for again for many years so do not get caught up in media hysteria or hopes that it will bounce back. Overall expect a dramatic shift in the US economy and stock market starting in late May and probably lasting into September 2000. OEX NOTES: (05/06) Next entry for puts around May 6-7; use Sept. or Oct. puts. Next entry may be a secondary high into May option expiration. OPTIONS TRADERS: We recommend that you switch to trading mini contracts on the S & P since options are so unforgiving. If you choose options, make sure you evaluate delta decay of options, manage your money and buy options that have enough time in them and do not trade against the major weekly chart trend. INTRADAY SERVICES now in effect: QUICK-TRADES HOTLINE: updated at 8:20 am and hourly from 9:30 am-2:30 pm CDT. Now contains more commentary at $4.95 PER CALL. Call 1-800-788-2796 for details. S & P COMMENTARY LINE: Updated with pre-opening comments at 8:20 and at 10:35 am, 12:35 pm, and 2:00 pm; more detailed and priced quarterly. JUNE T-BONDS WEEKLY CHART TREND: Bottoming. DAILY CHART TREND: Bottoming. TODAY'S EXPECTED DIRECTION: Volatile. NEXT HOURLY CHART NEXT DAILY CHART NEXT WEEKLY CHART TURN: 5/7 H/L TURN: 5/22 L TURN: 5/99 L; 8/99 H (05/06) Patterns on bonds suggest a recovery toward the 120.01 region and then a push lower again. However, with bonds again leading stocks, we think that if stocks are higher on Thursday, bonds could be also so we will wait out the next few very volatile days. Cycles very volatile and energetic the next few days and it's unclear from the patterns how things will unfold. Very oversold conditions on the hourly charts make it tricky do so. With a cycle low due over the next 1-2 days, we will stand aside for now. Look for support at the 119.08-119.09 region. Should that region go, it would open the doors for the 116 and 114 region. Next major support below is 118.24. OVERALL: If stocks top out, we do expect a flight-to-quality rally to develop in bonds until around August from late May; but because we expect a big spike in crude after August 1999; after that, we think bonds will get hit with a big inflation scare as gas and oil rally above the 1990 highs. The last of long-term deflation cycles is ending in August and that should change the current tendency of declining interest rates to something much messier. T-BONDS INTRADAY COMMENTARY LINE NOW AVAILABLE: Updated 8:15 am, 10:40 am, and 12:40 pm. Call 1-800-788-2796 for details. FOREIGN CURRENCY NOTES (05/06) The dollar broke key support but is due for a bounce on Thursday into early Friday. With daily stochastics lower, I suspect we are starting a bigger correction into at least May 13 or even May 17. The other currencies do not support that theory so we will continue to do research.