Subj : Market Action To : All From : Paul Rogers Date : Thu Jul 08 2004 07:50 pm


Ken Lay told the court he's innocent, but another court told the Rigas'
"Oh, no, you're not!"  Finally...

Today's market was underwater all day, except for a few moments
following another terrorist warning by DHS.  Prices finished down but
volume increased again to 6% above average.  10 more points and it will
fall through the important 200-day moving average.  And as you can see
below, the Oscillator fell into negative territory today.

So is this bad news?  Well, maybe not.  Now, ignoring all the important
things like the economy and looking at "market dynamics", the problem
seems to have been stock holders being willing sellers.  For the market
to go up, these guys have to be cleaned out!  I know some Wall Street
"talking heads" have been touting a "summer rally".  Forget that.
Suppose we had a correction instead.  My overhead resistance line for
this year is up at 1160.  Suppose the S&P fell another 50-75pts, making
it a 10% correction.  What are those guys going to do?  SELL!  They'll
take the money and run.  Now, it would take something positive to pull
the market out of its swoon, but without these sellers the market could
move up much easier.  It's no secret I've felt "cash is dandy" all year.
Having a conservative position in the market, meaning lots of cash,
would alleviate panic during the correction, and allow one to develop
and act on an updated shopping list when it's over.

Is a correction likely?  Overt, obvious market manipulation is much less
likely now than it was in the early 20th century.  And yet, when such an
idea as this becomes common among the "Big Money" investors, their own
individual behaviors can produce the same effect.  They can't conspire
to do it, but they don't need to and the effect is the same.

One of the things I've tried to communicate, both here and on my website
pages, has been interpreting the market action in simplistic good/bad
terms just isn't possible.  It all depends on one's strategy and one's
outlook.  If you're prepared, if you can execute the proper tactics,
corrections can be positive.

 Price     Vola-     Momen-    Volume    Oscil-    Summ.
 Change    tility    tum                 lator     Index
 -__+      -__+      -__+      -__+      -__+      -__+

 _|__      <___      __|_      __|_      __|_      ___>     07/01
 _<__      <___      _|__      _|__      __|_      ___>     07/02
 _<__      |___      _|__      _|__      __|_      ___>     07/06
 __<_      |___      _|__      __|_      __|_      ___>     07/07
 _<__      >___      _|__      __|_      _|__      ___>     07/08

Timing Signals:  I don't use or recommend timing signals, but they're
fun to watch.  If I did though, well, I might use something like this.
(Be warned!!  It tends to whipsaw around signal points!)

Last Signal: SELL       Date:  07/02/04 S&P:    1125
Winner or Loser:  Winner                By:     +12

See my market tracking charts for '02-'03 and my investment strategy
study at my website(s):
http://www.xprt.net/~pgrogers/Pers.html
http://www.angelfire.com/or/paulrogers/Pers.html
http://www.geocities.com/paulgrogers/Pers.html

Paul Rogers, paulgrogers@yahoo.com -o) http://www.angelfire.com/or/paulrogers /\\ Rogers' Second Law: Everything you do communicates. _\_V .... Deja moo: knowing you've heard this bull before. ___ MultiMail/MS-DOS v0.35 --- * Origin: The Bare Bones BBS (1:105/360) .