WELCOME TO STOCK MARKET DIRECTION

Steve Zito is a stock market technical analyst who also uses economic and technical analysis to forecast general direction of the stock market. The views stated herein are his opinions only, and should not be relied upon as advice for investment decision-making. If you have a specific question use the short survey form.
Coming soon! The NASDAQ page. ALL LINKS ARE AT BOTTOM.

INDUSTRIALS INDICATORS
THE STANDINGS

Five of seven indicators are negative
March 31, 2000

The Dow Jones Industrials Average
TECHNICAL INDICATORS

5-minute chart
Very negative
resistance 11,028

15-minute chart
Very negative
resistance 11,026

30-minute chart
Very negative
resistance 11,014

60-minute chart
Very negative
resistance 11,010

Daily chart
Negative
major support 10,695

Weekly chart
Neutral
major support 10,677

Monthly chart
Positive
long-term support 10,010

Trend change down---100%.
Support levels (4) are broken, indicate a trend change down this week.

Model Portfolio

******************Commentary*******************
The market has been attempting to rally every day this week, and each time the Dow failed to make any progress, closing today at the week's low, Dow 10,922. Last week, I called a top on Thursday at Dow 11,263. Since then, the Dow has dropped 341 points. This is a momentum driven market, and once the selling starts, it is impossible to stop it. When four out of seven short-term chart indicators said sell on March 23, the Dow's recent 14% advance ended. Five out of seven indicators are now negative, with the 60-minute giving a late sell today. Every market commentator will tell you on the tube that you should be in stocks, especially technology. Where were these analysts when the NASDAQ index was below 1000? They were telling you at that time to buy Gillette, Proctor & Gamble, and Coke. This is exactly what you would expect to hear. These analysts are always recommending stocks that have already risen dramatically. People might be able to make money off the "greater fool" who will buy their stock at a higher price, but that idea assumes they are willing to sell their stock. No one talks at parties about selling. People only talk about what they bought. The market as measured by the Dow is down about 5% this year, and at this rate the market will be down 20% for the year. NASDAQ just gave up half of this year's advance in the last 2 weeks. Most of the coming decline will occur in spurts followed by periodic sharp rallies like the recent 14% gain in the Dow. Due to tax season funds flows, the next two weeks will be a very risky time. The DOW put option entered in the MODEL PORTFOLIO, DJX April 108 put at 1 3/16 is now asking 1 3/4, increase of 47% in 6 days. It's a hold and I entered an additional position in DJX April 105 puts 2 days ago at 11/16, which is now asking 15/16 for a gain of 36%. The market should fall to just above Dow 10,695 which is the support level on the Daily charts. I will exit DOW puts at 10,695 with a gain and wait for a sudden, sharp 300-point DOW rally to enter a position in DOW puts for May. The DOW is not close to being as volatile as the media will tell you, as this year, the Dow has only moved 2% or more on 8% of trading days, compared to the amazing NASDAQ's 25% of trading days. Coming soon, the NASDAQ page!
Copyright Notice, all pages Copyright©2000 and are made available as a service to the global Internet community. Pages may not be reproduced or sold in any medium without explicit, written permission from Steve Zito.