Market Dearest

March 9, 2001
Eddie Kwong

The advantage of long-term trendlines is
that they identify potentially powerful support or resistance.

The disadvantage is that they are imprecise for short-term timing. A monthly
bar has plenty of wiggle room for temporary dips below it. So keep that in mind
with respect to the long-term charts of the S&P 500 and Nasdaq I showed you
earlier in the week. That is a glass half-full view — which is becoming less
fashionable these day. But it should not blind you to the fact that we may have
broken these levels and are embarking upon the next leg down.

There you have the ambiguous the nature of the markets. Try to be comfortable
with it. Because that’s the way it usually is.

On a bright note, oil service may well be setting up.

The Oil Services Index
(
OSX |
Quote |
Chart |
News |
PowerRating) pulled back to the level of its March 7,
2001, breakout. It may find support there and bounce.