>die Boys von Pru-Bache in Europa sind sichtlich froh, wenn sie nicht auf diesen
>Accampora angesprochen werden, denn sie werden, wenn trotzdem geschehend,
>direkt agressiv oder fühlen sich zu Tode betrübt. Ich denke viele Mitarbeiter
>dieser grossen Boutique sind Accampora ins Messer gelaufen.
>Das würde dann erklären, weshalb er neue Höchst-Kurse erwartet - eigentlich
>nichts anderes als"creative prognosis" der bullen-kranken Spezie.
>Emerald.

Looking for a friendly trend
Technician Ralph Acampora sees a very bumpy ride

William Hanley
National Post


Saturday, June 01, 2002

National Post
Ralph Acampora, director of technical research at Prudential, says the gold chart looks"absolutely fabulous," adding he doesn't totally disagree with the view that gold is beginning a multiyear outperformance.

NEW YORK - Fraunces Tavern, a few blocks from Wall Street, is where George Washington said farewell to his officers on Dec. 8, 1783, after winning the Revolutionary War. On a recent Tuesday, we're wondering whether our guest for lunch, famed technical analyst Ralph Acampora, will perhaps be moved to say goodbye to this faltering stock market.

Well, not quite. The charts are giving Prudential Securities' managing director of global equity research plenty to worry about. But he's not quite ready to cross that particular Delaware, as it were, and become bearish and tell people to sell.

"It's going to be very, very bumpy here," Acampora says of the market in general, noting that even some of the stocks he's been recommending --"the new leaders" -- are beginning to get a little weak technically, that momentum, which is central to the technician's trade, is starting to flag in the mid- and small-cap groups he has especially favoured.

The old leaders such as Cisco and Intel have given way to the Coca-Colas and Procter & Gambles, which were out of favour in the great technology-driven market run-up of the late 1990s. And though the Nasdaq has sunk, the S&P 500 has fallen and the Dow Jones industrial average has basically gone sideways, he believes a new bull market actually dawned in January, 2001, based on the positive breadth of the market. Sure, most of the big-cap leaders were still falling, but the majority of stocks were rising.

Even today, there's always something to buy. If you don't like the idea of Fraunces's steak with red and white potato salad, you can opt for the meatloaf with macaroni and cheese and sautéed spinach. Which is what Lunch Money does, reckoning that George Washington himself might have made such an American choice, his wooden teeth also a consideration. We cannot tell a lie: The meatloaf and spinach are good and entirely appropriate to the patriotic venue; the"mac cheese," as Fraunces quaintly terms it, is no great example of the chef's craft.

But we quibble. Our guest, who appears to know his way around the menu almost as well as he does a chart of the Dow, enjoys a large bowl of clam chowder and a main of grilled free-range chicken with a side order of vegetables. The service is brisk and just friendly enough.

Acampora, who has spent almost 40 years on Wall Street charting the market, is saying that the trend -- whether short term, intermediate or long term -- is the technician's friend.

"The first question I ask is: Is it going up or down?"

At this particular point in time, the trends on the major indexes are not as crystal clear to him as they were when, for instance, the Nasdaq was going to the moon in the late 1990s.

"In hindsight, you could have gotten very nervous with that accelerating trend," he says in his rapid-fire Bronx accent."But in all honesty, if you were a momentum guy like me, you would be going with that trend. I knew at some time I would overstay my hand."

In his outlook for 2000, when Nasdaq was at 3500, he targeted 5000 for the index."Everybody thought I was nuts. So when it got to 5000 [in March of that year], they were pushing me on where it was going to go. I actually raised my target, saying it's possible to go higher if you give it time."

The rest is history. It broke down soon, dropping quickly to 3000, then stabilizing between 3000 and 4000 for about six months.

"When it broke below 3000, you had to be out. I didn't get you out at the top. But if you played the game and pushed it all the way, you did very well."

Today, with uncertainty ruling and trendlessness the trend, Acampora sees Nasdaq trading this year in a wide range of 1300-1500 on the downside and 2100-2400 at the top from 1650 now. The Dow's range could be 7600-8500 to 11,500-12,000 from 10,000, the S&P 500, 950-1000 to 1350-1400 from 1065.

"In a period like this, the best way to succeed is to treat every holding on its own technical and fundamental merits. It's a market of stocks, not a stock market. People think that's a cute little saying. It's an important saying."

What could be very important in determining the overall market's direction, he says, is the strength of the U.S. dollar. If it breaks below the low of last September, it could really damage the equity market because even more European money will retreat to euro-dominated securities.

This very day we're enjoying Fraunces' hospitality, Merrill Lynch has agreed to pay US$100-million to settle a dispute with New York Attorney General Eliot Spitzer.

"The lack of confidence [in Wall Street] is really sad," Acampora says."You don't regain that overnight. The last time we lost a generation of investors was 1973-74 -- the oil shock, the presidential scandal, the lack of confidence in the market. People were saying 'I don't want to invest in that'. The industry shrunk."

He smiles a thin smile.

"I'm glad I'm not a fundamental analyst in the current climate. As technicians... we never have a problem with insider information because our information comes off the tape and everybody gets it the same time as I get it. And I have absolutely no relationship with corporate finance. We never deal with companies or management. If you want pure, unbiased research, it comes out of technicals."

For his own part, Acampora eschews investing in individual stocks and avoids possible conflicts of interest by buying Prudential's Family of Funds mutual funds.

"You're going to get more and more defensive the older you are," he says as we wait for the cheque. But at 60, he has no plans to slow a pace that keeps him on the road about 50% of the year.

He was in Europe last Sept. 11 when the World Trade Center became Ground Zero just three blocks from his apartment. He couldn't move back in for two months.

As the cheque arrives, he notes that one chart shows a very strong uptrend.

"The gold chart looks absolutely fabulous. We had a bear market in gold for 20 years. Now some people are saying it's the beginning of a multi-year outperformance by gold. And I don't totally disagree with that."

But he wonders if gold will outperform the old leaders like Cisco and Intel or the new leaders like Johnson & Johnson, PepsiCo and Procter & Gamble, which were the growth stocks of the 1970s.

"It's a big statement, but I think they're going to be growth stocks again."

Quelle: National Post


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