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To: Sarmad Y. Hermiz who wrote (60516)	6/4/1999 12:18:00 PM
From: GST	Read Replies (2) \| Respond to of 164684

Sarmad -- Patience.

To: Sarmad Y. Hermiz who wrote (60516)	6/4/1999 12:44:00 PM
From: Rob S.	Respond to of 164684

Here are a few longer term trend indicator charts from MarketGuage.com One of them shows the long bond yield and may shed some light on the interest rate discussion. I think rates are partly factored in but the factors that drove the Internuts up to such a high degree, ie. dropping interest rates and pumped up liquidity, are unlikely to return. The general trend in the market will be sideways to slightly down but the high P/E stock will remain vulnerable to a continued correction. marketgauge.com The mutual funds cash balance chart shows MFs have been totally invested. Most MF charters require them to keep a minimum cash balance of around 5%. That probably means that they have no money to continue to pump into the Internut or other high flying sectors. This is particularly true when investors start pulling their money out of MFs. Then with no cash reserve cushion, the MFs must quickly liquidate stocks to pay out the withdrawals. Fund flows just turned negative for the first time since last summer's big correction. marketgauge.com The NY specialist and stock exchange member short position chart shows where the smart money has been betting where the market would be going. This should give private investors pause when they look back to analysts and other self-interested parties buy recommendations when the Internuts were 50% or more higher. marketgauge.com This chart shows the Long Bond yield v. the market. As you can see, it has been rising and is at a level that is negative for money flows into the market. Looking back at where it was last year when the market plunged downward, it looks like the market could certainly head further down from here. I don't think a repeat of last year is likely, but the trend is not good (for bulls on high flyers). marketgauge.com The Value-Line MACD indicator is very interesting. This shows a sharp spike up in money flows into the mid cap and value stocks even while the Internut sector has been taken down a few notches. This corroborates the idea that there has been a rotation out rather than a mass exit of the market.