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My daily and weekly NASDAQ breadth models continue to show the NASDAQ in
good shape. Not so for the NYSE where the daily breadth models have been
showing steady deterioration and are only a hair away from an
intermediate sell while the weekly breadth models are still in good
shape. All of which suggests that the S&P is probably due for continued
correction and the NASDAQ and Ru2000 (which I really like) should
continue to see new highs. I also note that the Europe and Asia Pacific
indexes appear to be correcting. I will be looking to put long term
money back into Asia and into Europe once the corrections have run their
course in the belief that both currency trends and corporate
reorganization will be strongly favorable to these economies. I could
also get enthusiastic for the intermediate term trend in the long bond
if the Fed raises rates by 50 basis points.
Investors should note that equity valuations which I track on the S&P
are at historically extreme levels and that the Fed is trying to reign
in the economy before the election cycle heats up. This is likely to
lead to great volatility and could lead to a precipitous drop. The last
time the Fed bailed out the world's economy, it heated up again, so the
Fed may not be as quick on the trigger to cut rates.
Earl
----- Original Message -----
From: "Don Thompson" <detomps@xxxxxxxxxxxxx>
Cc: <realtraders@xxxxxxxxxxxxxxx>
Sent: Saturday, January 22, 2000 5:53 PM
Subject: [RT] Re: Longer Term Top? for S&P500
> One of the things that has never been discussed on RT in my
recollection
> is the evidence that the NASDAQ is now the leading index with the
S&P500
> lagging.
> Any comments regarding money actually leaving the NYSE and migrating
> over to the
> NASDAQ?
>
> BobR's comment that a sideways SnP500 could be up for the near term,
> why? people are taking money out of it and putting it into the Nasdaq.
> Only the NASDAQ stocks in the 500 are holding the thing up. (No
> evidence.. just assuming)
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