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

To: Compadre who wrote (13202)	5/7/1999 4:46:00 PM
From: Compadre	Respond to of 99985

LG and all: My system changed its signal in the very last minute from buy to sell. 2117 was a buy and 2118 a sell. So we have a marginal sell signal at the end. It does line up with my analysis though about a possible sell off in the next day or so. I will post more details later in the weekend. Regards, Jaime

To: Compadre who wrote (13202)	5/8/1999 2:12:00 PM
From: Rob S.	Read Replies (1) \| Respond to of 99985

I think the "market" is hard to read because we are seeing so much sector rotation. "These are the best of times, these are the worst of times . . . " depending on what you own. For instance, some mutual funds are seeing their best results in years while speculative sector funds are getting punished. The Internuts and tech stocks except for a few segments have lost their leadership role while the cyclicals, as dreary as they may seem by comparison, have gained favor. I agree that the psychology of the market has shifted. That shift has occurred as money flows that have fueled the speculative valuations of the growth stocks has stopped mushrooming. South America, Asia and other markets look safer and more attractive and the fed and world monetary organizations are not as pressed to increase liquidity. Inflation is not a significant concern but dis-inflation of pricing is also not going to be as much of a stimulant to the US economy that it was during the past several quarters. While food and many other economic inputs are favorable, oil, wages and some other major inputs are negative. It's no longer a one way street. The psychology of the more speculative issues, such as the Internut sector, has been fueled by the wild growth of the Internet. That sets the stage for imaginative speculation without much concern about mundane reality. Is it much of a surprise then to see the net stocks pull back after the speculative fever is faced with the earnings reports, even if they beat expectations in many cases? No matter how good the reports turned out, they failed to keep up with the fanciful dreams of investors. And now we are into the softer quarters for Internet growth. A lot of Internet commerce sales is seasonal - Fall/Christmas. And the summer is the time to slip off the worries of the market and get comfortable. In addition to the normal summer tech slow-down, I theorize that we will see some let down in the high-flying stocks as some investors vacate them so they can relax during summer vacations or while they are buzy with the kids who are out of school. As the computer screens get turned over to games or turned off, so does a major ingredient in the trading fever. Maybe it's better to analyse individual sectors rather than the broad market. Go with the flow.