Steve Zito, MS Fin/BS Econ Wharton School, HTML Writers Guild
uses economic and technical analysis to forecast the direction of the stock market. The views in this newsletter are opinions only, and should not be solely relied upon for investment decisions.
Nasdaq April 9 -Trading Tips -Sitemap -Stock Picks -EMAIL ME

NASDAQ COMPOSITE
INDEX closed 1756.19

Nasdaq waits on Intel April 15, 2002

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April 15 Go To Page 2. Nasdaq Composite closed 1756.19 +30.95 on Fri., April 12. Dow Jones closed 10,190.82 +14.74. The Dow downtrend reached 17 trading days. The Nasdaq took out last Monday's low on Thursday. A late rally Friday could be short-covering by billion dollar hedge funds (money center banks). The world's wealthiest investors, betting against you, Joe Public with your $10,000 IRA. You see them on TV pumping prospects of U.S. economic recovery and promoting fictional benefits of long term retirement planning (buy and hold). At the same time, their Wall St. cronies are shorting, dumping huge share blocks of falling stocks, and generally taking market positions counter to the public. The planning proof to push weak markets in profitable directions for wealthy clients is reflected in ever-widening SEC probes of E-business stocks with no chance to succeed. You know ENRON (accounting firm Arthur Andersen), Global Crossing, Metromedia FN. The employees of these companies had life savings in company stock and lost it all. The well-known Wall St. analysts pimped these stocks to dizzying heights (JDSU at $150!), and surprise, those analysts are still employed, appearing daily on CNBC. Analysts have been sued for $millions and as soon as suits are filed, the big brokerages settle out of court. Now, it appears that even the bluest of blue chips have accounting issues to cover. Xerox just paid the largest SEC fine ever. Will stocks ever RALLY? Remember, money flow drives stock prices. Certainly, the sky high valuations for retail, consumer non-durables, and food stocks (so-called defensive issues because everyone has to buy clothes, wash, and eat), are valuations that cannot be sustained. When the money shifts, where will it go? My bet is NETWORKERS. The widespread bankruptcies and consolidation in that industry will leave a few mean, lean competitors with an entire "pie" to themselves. The threat of renewed conflict from the Middle East spilling over into the U.S. was played up by the press on Thursday, but is that a reason to sell? War has always been a boost to economic activity in the U.S. There are many new and old security companies that want to expand sales for devices such as full body X-ray scanners, face recognition software and scanners, plastic national I.D. cards. All new products with latest technology. Why isn't there a boom in these new sectors? The ACLU is blocking it for privacy issues, since the X-ray devices show the naked body. Facial recognition is only as accurate as your last Plastic Surgeon makes it and bad boys won't carry a national I.D. card next to their fake drivers licenses. The 90-day moving average for the Dow has fallen to 10,240 from peak 10,560 in February. The rate of annual decline is 39.9% vs 43.9% week ago. Expect a TREND change. Next major support level is 9858, which only happens if WAR in Israel explodes onto CNN into your living room. I wrote correctly March 28 to expect weakness April 5-15 prior to the U.S. Income Tax deadline.
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