Forum Archive Index - May 2002

["Nick Kearney" <nickk@quicksilver.net.nz>]

Read this if you want to know where the DOW, NASDAQ and S&P500 is heading.

Easy answer is South.

Cheers and happy reading.

Nk

PS I think he is a little optimistic about the bulls approaching!

----- Original Message ----- 
From: <jeff@lowrisk.com>
To: <nickk@quicksilver.net.nz>
Sent: Tuesday, May 07, 2002 8:07 PM
Subject: Walker Market Letter - 05/07/02


> 
> ...............................................
> 
>        W a l k e r   M a r k e t   L e t t e r
> 
>                  May 7th, 2002
> 
>               http://www.LowRisk.com
> 
> 
> ...............................................
> 
> 
> Our Signal Strength is still at 9. There are no changes in
> our strategies or models.
> 
> I have enclosed a market commentary below.
> 
> 
> 
>        // -- MODEL UPDATE -- //
> 
> Lowrisk Market Allocation Model signal strength = 9 (on a scale
> of 0-20, with 20 being the most bullish)
> 
> **********
> 
> Disaster Avoidance Strategy - 100% stocks as of 12/06/00
> Graduated Strategy - 25% stocks, 75% money markets as of 10/19/2001
> Timing Strategy - 100% money markets as of 06/11/2001
> SuperBear Strategy - 100% money markets as of 12/14/98
> 
> **********
> 
> 
> Well here we are two years since the top in early 2000 and
> the bear market grinds on.
> 
> As we have seen so often in the last couple of years, we
> have a split market here, with the Nasdaq much weaker than
> the Dow and SP500. However, lately the blue chip indexes
> have not been spared by the carnage, and they have been
> playing "catch down" with the Nasdaq.
> 
> As the market drops closer and closer to last September's
> lows, it seems like the talking heads in the Wall Street
> media are finally starting to pay attention. All of a
> sudden, we are hearing a lot of bearish analysts, and even
> some of the "perma bulls" are looking for lower prices.
> Where were they in January, when everyone was talking about
> how the market couldn't possibly have three negative years
> in a row?
> 
> OK, getting back to the current market...those September
> lows are definitely "in play" on the Nasdaq, especially on
> the Nasdaq 100. On 09/21/02, the Nasdaq 100 hit a low of
> 1088, and closed at 1127. From those lows, it rallied up to
> a high of 1734 on December 6th. The Nasdaq 100 has now given
> back 89% of those gains, and on Monday it closed at 1161.
> And there are no important support points left between Monday's
> 1161 close and the September lows...which means that the
> road is clear for a further drop down to those lows.
> 
> Of course, the other indexes are doing relatively better.
> For example, the SP500 has "only" given up about 54% of its
> gains since the September lows, and the Dow has given up
> about 33% of its gains.
> 
> With this current downdraft now in its eighth week, the
> market is due a strong bear market rally. The market is
> starting to get stretched out on the oversold side, and we
> are seeing some pretty extreme bearish sentiment on the short term.
> This doesn't mean the market has to turn around immediately,
> on the contrary we would expect the rally to come from lower
> levels. But it is something to watch out for...we have a
> powerful bounce coming.
> 
> As I have mentioned many times over the last couple of
> years, it is the nature of bear market rallies to be very
> convincing. For example, look back just a couple of months
> ago at how many people thought we were in a new bull market.
> When the bulls do finally get things turned around, the
> rally will be very violent and quite impressive. HOWEVER,
> the bottom line is that right now we are solidly in an
> intermediate term bear market.
> 
> OK, stepping back and taking a look at the VERY big picture
> view, we are really starting to hear a lot of doom and
> gloom, and I am starting to think it could be getting a bit
> overdone. Long time readers will remember that I got bearish
> a bit too early (in late 1999), and I am probably going to
> be too early when I start to get bullish. But just like
> trees couldn't grow to the sky back in 1999 and early 2000,
> I don't believe that we are in a 1990's Japan type of
> scenario here. This isn't to say that I am getting bullish
> just yet, but just like we had a lot of bullish excess a few
> years ago, there will come a time when all that excess has
> been wrung out of the market. Then it will be time for the
> bulls to shine once again.
> 
> We have been publishing this newsletter for six years now,
> and it really has been amazing to watch the market go
> through the best of times and the worst of times. And what
> has been really gratifying is helping our subscribers
> maximize their returns and avoid this huge bear market. I
> know that you might be among the many readers of this
> newsletter who just subscribed recently...in which case you
> didn't have the benefit of side-stepping the last two years
> of losses in this bear market. Of course, it is never too
> late to get onboard with our strategies, and the best way to
> do so is to upgrade to our Walker MarketEdge publication.
> That way you get all of our additional updates as well as
> our Flash Updates whenever our models change positions. You
> can get the Walker MarketEdge at this link:
> 
>      > > https://www.lowrisk.com/wme-secure.htm  < <
> 
> 
> One of the most amazing things over the last couple of years
> is how our Walker MarketEdge mutual fund picks have
> consistently found good funds to invest in, even in the
> midst of this bear market. That really speaks to the fact
> that there has always been at least one or two segments of
> the market that is doing well, even while so many stocks and
> funds had large losses. Our No Load Mutual Fund picks are up
> almost 10% this year, which is a pretty amazing performance
> considering the SP500 has lost 8.3% and the Nasdaq composite
> is down 19.1% in the same time frame.
> 
> That performance of our Mutual Fund picks this year is not
> unusual. In fact, our No Load picks gained more than 20%
> from January 2000 to December 2001...which isn't too shabby
> considering the huge bear market we have been in. Our Mutual
> Fund picks are included as part of the Walker MarketEdge
> subscription, so you will get them if you upgrade now:
> 
>       > > https://www.lowrisk.com/wme-secure.htm  < <
> 
> 
> 
> Good luck,
> Jeff Walker
> 
> 
> Copyright (c) 2002 by Jeff Walker, Bayfield, CO. This
> newsletter may be forwarded, as long as you do so in its
> entirety.
> 
> Disclaimer:
> The financial markets are risky. Investing is risky. Past
> performance does not guarantee future performance. The
> foregoing has been prepared solely for informational
> purposes and is not a solicitation, or an offer to buy or
> sell any security. Opinions are based on historical
> research and data believed reliable, but there is no
> guarantee that future results will be profitable.
> 
> 
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