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

To: pater tenebrarum who wrote (14350)	5/19/1999 1:09:00 PM
From: StockOperator	Read Replies (1) \| Respond to of 99985

heinz, I agree with your thoughts completely. Sooner or later we are going to see a serious retracement for many of these companies with almost vertical chart patterns. However I also agree with your take on one more leg up. I think the next leg will suck huge amounts of money off the sidelines including many new traders (day) and investors in what will prove to be a massive distribution of shares from the smart money to the public. And then when things look the rosiest ,,,,,,. The interesting thing about rates is that in Oct 87 when the market crashed, rates spiked up to their highest point and then reversed. That spike proved to be the high from past to present. In 8/90 the month the market tanked (the last recession), rates were once again at their highs from a move that began 13 months earlier. After which rates began to fall and the 95 bull run began. Well if you connect those two points 10/87 and 8/90 that trendline runs right into where we are currently with rates - actually six percent looks like serious resistance area. So it is interesting that rates are right at a point that has proven to be devastating for equities. So yes I am nervous. Which also makes me in no hurry to go long. At this stage of the game being late to the party is better than being caught in a 700-800 pt. down day. Regards, SO