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

To: Haim R. Branisteanu who wrote (13827)	5/14/1999 9:43:00 AM
From: James F. Hopkins	Respond to of 99985

Haim: THanx, and well I saw a ominous sign April 14th , I called it the crossed swords, Small Caps were flying up while Big ones were falling. At market tops this almost always sets up a disasters. ---------------- My way of looking at things is simple, actually I developed it by reading Value Line, ( of all publications this is the best single one I know of if one reads all the rest and skips Value Line they have done themselves a disservice.) ------------------- In General Smaller caps with their smaller float can and do out perform big caps, ( both ways up & down ) There is nothing wrong with the rapid rise in small caps over big caps, except when the Big caps are Falling. They should be at least holding their own, a rotation from them into smaller caps never works, at least not at tops. The market losses it's ability to be liquid, then when profit taking does set in it makes a much faster dash to the down side as it's harder to get the money out of small caps, a general selling panic hits , a lot of it by computer program trading and every thing sells off, but the thinner traded ones always lose the most in down trends. --------------------- Well any way we may push up some more but the signs that it's a set up are real strong. Out of only 10 of the Major Players $156,000,000,000 has been taken off the table in the last month or so. While the indexes are supported on the "thin legs" of Stocks with smaller floats. --------------------- Most of the Growth funds in spite of good capital inflows are down , this seems to say that while WE are buying some other forces are selling, ( foreigners are easing out of our stocks they see the dollar UP 5% since the first of the year ) Hence in their eyes our market is 5% higher than it is in our eyes and they want their profit. This is also born out by the fact it's the major Blue Chips that are off 156B , the ones that most foreigners deal in. --------------------- I'm not saying the market can't fix itself, But unless the Blue Chips stop falling we are getting set up only XON and IBM are up, and I added their gains to the figures , had I not done that the down side of the other 8 would be 231.6B ...there is a lot of cash flowing into the market BUT not enough flowing in to make up for that, 156B drop in major market cap. Funds are doing window dressing now and trying to pick Mo Mo babies to up their Navs, I can't say when it will hit but it has all the ear marks of a strong correction when it does hit. --------------------- And my eye is on MSFT , Wcom, INTC, CSCO , more than the others if any of them break south IBM and XON won't stop the down turn in the indexes. That the stupid ( non weighted Dow ) has climbed (percentage wise ) well above the S&P500 should have people on their toes. Before it's over she will go just as much below it as she is over it, ( if not more ) Jim