Replies to post #105507 on Zeev's Turnips Patch-No Politics (ZEEV)

[punkle]

Thank you both for your explanations - very helpful.

[schloss_1]

Culmus-

If you will go to the bottom graph on post #984026, I think you will see the exact point where Greenspan began to manhandle the markets. Usually I don't go in for conspiracy theories, but there have been too many unusual and unexplained moves in the markets lately. Certain issues seem to be bought in quantity every time that the Dow looks like it may head into negative territoy beyong 75 points.

The only question for me now--as a short-- is whether to play this nutty game, rely on tight stops to the upside, play longs with tight stops on the downside, or go fishing? Greenspan has taken all of the freedom out of these markets and it is growing tiresome.

schloss

[Zeev Hed]

Culmus, maybe, just maybe, TA and FA do "jibe". The question one may want to ask is how much less borrowing corporations and consumer are going to practice before these series start and expand again. The through in these series, fundamentally, should coincide with the through in business activities. Yet, it is very unusual for a bear market to end with the type of lack of negative extremes we got in the last two months. One can take the position that the bear market ended in October last year (where such extremes were present), but the counter argument to that position is that if the bull market is already seven months old, how come not one of the Dow stocks are hitting yearly high (I don't want to bring all time highs in the picture). This bothers me a lot. One of many reasons I have not donned the horns.

Zeev

[techanalyst1]

You did have both the naz and ndx break their December highs yesterday on good volume, but might that be due to a rally that was based on momentum and short covering with even more short covering when the indexes broke those "lines in the sand"?

Look what happened to MMM: It was on it's way down to at least testing the Oct. lows when the rally broke in March and up when MMM on good volume to all time highs. I'll bet there were all kinds of buy programs and technical traders buying that break to all time highs, only to see that the break now looks to be a false one..... based purely on technicals without additional followthru. I've seen that happen to stocks in the past and false breaks in an extended period of a trading range can be worse than staying in the old trading ranges with a break actually then going below the range. All the shorts covered on the move over the old highs and everyone who wanted to buy already has in the last period of that range. Realizing that it still isn't going anywhere after all this time, maybe they just give up and sell out...... after all that "distribution" and waiting for the final payoff of seeing even higher prices........ they finally sell out.

I don't know what fueled MMM but I kinda think it was hope that their earnings would be gangbusters with masks for SARS but that is a small part of their earnings, not likely to make much difference. Anyway........... they already admitted a few months ago they have no pricing power and if the econ slows down, most likely they will see lower sales in other products offsetting their gains in sales of masks. They got a boost from currency fluctuations and without that, what growth in earnings was there?

Besides that..... they announced a raise in the dividend and then went and borrowed money! I think they did that last year too. But of course we all know that companies raising dividends must be getting it from cash flow because cash don't like, right?

MMM: Getting oversold, but I sure won't be surprised to see it bounce a bit at 119-here and then sell off again breaking the low set in March.

The indexes could be just a big fat MMM technically speaking.

TA