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

To: jjs_ynot who wrote (16157)	6/5/1999 8:02:00 PM
From: donald sew	Read Replies (2) \| Respond to of 99985

Dave, Thanks for your analysis. Although my system is somewhat complicated, I try to keep it simple/basic at times. Most of the indices have produced lower lowers which were preceded by lower highs, which is basicly a definition of a downtrend. That does not mean that we did not bottom, but we need confirmation as you stated. To have good confirmation that this correction is over, we really need a higher high and not necessarily a new high. On the other hand the forth coming downswing would need to set a lower low to continue the downtrend. On more possibiity is that the market produces a LOWER HIGH and a HIGHER LOW which implies a TRIANGLE. My point is that we really need confirmation in either direction. I am still bearish, but I will still look for confirmation day by day. Although I have made strong opinions, I dont do it often. It just befuddles me how some can be so strong with their opinions. Its refreshing to hear objective analysis's where one requires further confirmation, regardless of their opinion. seeya

To: jjs_ynot who wrote (16157)	6/5/1999 10:42:00 PM
From: Berney	Read Replies (2) \| Respond to of 99985

Dave, I used to play a lot with the weekly MACD's on the DJIA stocks. Had a little model that I called BAMBI and I still update it periodically. I divided the picture into six groups: 1) bullish signal, 2) bullish, 3) bullish but reversing, 4) bearish signal, 5) bearish, and 6) bearish but reversing. I found that the strongest price moves were in group 6. The problem was that in a fast moving market, by the time the bullish signal was given, all or the bulk of the price move had already occurred. I also found that there was a natural movement from 1 to 2 to 3 to 4 to 5 to 6 and back to 1. The time to be concerned is when I see a lot of backing up. In other words, stocks not going from 6 to 1, but back to 5. The problem with MACD analysis is that as most TA or FA, it is attempting to view historical results and project future direction. It will work ... most of the time. However, MACD has a particular problem in a non-trending market. I also found that the MACD was of dubious value when the stochastics was above 80 or below 20. Just my observations. Berney

To: jjs_ynot who wrote (16157)	6/12/1999 7:39:00 AM
From: jjs_ynot	Read Replies (1) \| Respond to of 99985

MACD UPDATE This update reviews the intermediate market trend (2-6) weeks based on MACD indicators. SPX - Down for 9 weeks and a failed bounce from below a "0" point. From an MACD perspective, the "0" line of support is becoming resistance. OEX - Down for week 8 approached a "0" point where it bounced and just returned to "0". RUT - Down for the third week in a row INDU (DOW) - Down for the fourth week with a strong down slope. Appears to be headed for "0" at least implying a test of 10250. TRAN - The previously indicated strong down move that is now 4 weeks old. It only slowed briefly near "0" and penetrated well below. This is a very negative chart from an MACD perspective. COMPX (Nasdaq) - Oscillating below "0" now an 8 week old down move. Here again "0" appears resistance. A modest move up from here would give a buy signal. NDX - Same as COMPX. Came very close to a buy signal this week, but then failed. IIX - Down for 9 weeks. Penetrated an important "0" point. The downward slope has become less. DOT - Down for 10 weeks and has started to flatten well into negative territory BKX - Down for 6 weeks. Had previously started to flatten but the decline below "0" has started to accelerate. XAU - Down for 5 weeks. Has flattened and may give a buy signal this week. HFX - Down for 4 weeks. Sliced through a "0" point. Like the Dow a strong downtrend. DRG - A failed buy signal deep in negative territory. About to give a sell signal. This is a sign of real weakness. UTIL - An 8 week uptrend appears about to give a sell signal. TYX - Several weeks ago a cross into a downtrend occurred and was negated. This is now moving up in a strong uptrend. SOX - A strong 1 weak-old uptrend. MSH - A 1 week uptrend appears about to fail. As previously stated, market reaction near supports was important. A number of technical supports have failed or appear are about to fail. The market leaders DOW, HFX, TRAN and internet stocks (DOT and IIX) are falling. The apparent bottoming of XAU and strong uptrend of TYX are also a negative for the market. The one bright spot is that the NDX is showing some signs of finding support and the SOX is actually trending up. Both of these may be attributable to the economic resurgence of Asia. Extreme caution is warranted here on both sides. However, the long side only seems to be viable for short term trades at the moment. Good trading.