Subj : Market Action
To   : All
From : Paul Rogers
Date : Mon Jan 03 2005 05:12 pm

Content-type: text/plain

OK, here we go again!

Sunday evening I got my "Tracking the Market" page updated.  It's got
all new charts, essentially the same commentary of 2002, for your
review, and my summary for last year.

You should note the "channel" formation that seemed to control most of
last year.  I don't think there's any debate on just where its influence
over Street Traders ended, and it wasn't August!  (Look where the 50-Day
Moving Average crossed the 200-Day on the long term chart.)

The 5% Exponential Moving Average is my simple version of a "timing
indicator".  If you study that it may at first appear that it could be
improved if instead of just the "zero crossing" points, I used major
inflection points.  I don't believe there's a practical way to
"automate" stock trading decisions like that.  I think its value is more
like an alarm clock, to wake us up that the tide has turned.  It is of
value though to study how it often dithers.  That's why I often say I
don't believe all of its signals.

Today's paper has its review, and suggestions, if not predictions, about
what's likely to happen in investing this year.  My suggestions?  For
what they're worth:  Be conservative in changing your asset allocations.
Let the market tell us what it wants to do.  But don't pay too much
attention to such "indicators" as the "January Effect"--that's been
wrong the last two years out of two.  Quit looking for a return to the
"Gay 90's".  (There are some serious economic concerns in play, not
least of which is rising interest rates.)  Start from a more traditional
asset allocation, assuming closer to a historical 10% return, and make
your conservative adjustments from there.  Remember Buffet's two rules
for investing, and the 7% Solution.

As for today's action, there was a quick jump in the first few minutes,
but it was all downhill from there.  Prices fell 80% of the way to being
significant on its own, and volume went from -43% below to 9.9% above
average.  So close!  My formula requires 10% to call it a "Distribution"
day.  Guess the Street is back to work, eh?

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

 __|_     _|__     __|_     <___     __|_     ___|     12/28
 _|__     _|__     __|_     <___     __|_     ___|     12/29
 __|_     _|__     __|_     <___     __|_     ___|     12/30
 _|__     _|__     __|_     <___     __>_     ___|     12/31
 _<__     _|__     __|_     __<_     _<__     ___|     01/03

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: BUY        Date:  10/27/04 S&P:    1125
Winner or Loser:  tbd                   By:     tbd

See my market tracking charts for '03-'04 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

.... Does the name Pavlov ring a bell?   No, when's dinner?
___ MultiMail/MS-DOS v0.35

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 * Origin: The Bare Bones BBS (1:105/360)

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