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Three factors at work here: established bull trends in equities (weekly
chart), ND (futures) has been relatively stronger than SP, and huge
average range (AR) in ND makes money management difficult. SP is the
weaker of the two, so I consider it preferable for shorting not to
mention that the AR is tighter so I have better money management. Yes,
the ND will be a faster and sharper decline when the top is in but
anyone shorting the last several tops for a position trade had very
tough sledding. It's all a matter of time frame - were I a day trader, I
might hunt for the top in the ND with very tight money management.
Earl
----- Original Message -----
From: "Iqbal Ali Sajanlal" <iqbals@xxxxxxxxxxxxx>
To: <eadamy@xxxxxxxxxx>
Sent: Thursday, February 10, 2000 11:07 PM
Subject: Re: [RT] Re: S&P
> Earl:
>
> It is very interesting to note you say " I am currently
monitoring a
> major developing divergence in the NASDAQ and when the NASDAQ breaks,
it
> will be time to short the S&P, but not the NASDAQ."
> Is it not tue the NASDAQ will fall fast and severe compared to S&P ?
Please
> explain for my understanding.
>
> Earl Adamy wrote:
>
> > I recommend monitoring both NYSE and NASDAQ. Use the NASDAQ as a
trend
> > indicator and stand aside the S&P when NYSE signals diverge from the
> > NASDAQ e.g. had a NYSE sell signal several days ago but I did not
short
> > the S&P. I am currently monitoring a major developing divergence in
the
> > NASDAQ and when the NASDAQ breaks, it will be time to short the S&P,
but
> > not the NASDAQ.
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