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Mix-Ansicht- Aus dem WalkerMarketLetter - JüKü, 11.09.2000, 09:24
Aus dem WalkerMarketLetter
"It really looks like the stock market is headed lower, perhaps
dramatically so.
After five consecutive positive weeks, the market was lower last
week. It was primarily the Nasdaq that sustained the real damage,
with the Nasdaq Composite down 6.05%. The SP500 also saw some
selling and ended the week down 26.27 points (or 1.70%). But the Dow
was virtually unscathed, down only 18 points for the week. And
meanwhile, the Dow Utilities remained strong and closed at a new all
time high on Friday.
So wasn't last week's selling just a normal pullback after a strong
five week rally? Doesn't the market deserve a little breather?
Perhaps, but last week's highs looked a lot like an intermediate
term market top for a variety of reasons. The foremost of these is
the market internals (in other words, the number of advancing and
declining issues, and the up and down volume). Simply put, they
looked awful. All through August as the market ground higher, *all*
of our internal indicators headed lower. This is the classic setup
we look for in an intermediate term top...across the board bearish
divergences in our internal indicators.
Of course, we never hang our hat on one indicator(or in this case,
one set of indicators). The charts also looked pretty precarious
before last week's selloff. The Nasdaq and SP500 were in"rising
wedge" formations. This pattern usually ends in a very ugly fashion
with a dramatic selloff...it is just a matter of waiting for the
pattern to break. Well, those patterns broke last week. The carnage
in the Nasdaq on Friday was just the type of selling we expect after
a rising wedge pattern breaks."
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