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This morning wasn't bad, prices were modestly positive.  Once again
after lunch it all came apart and prices fell rapidly.  Just in the last
half hour there was a bit of a quick recovery on some bit of news, but
nowhere near enough to make this anything but another ugly day.  Prices
closed down about -40% of the way to significance, but volume jumped
again to +33% above average.

There's just no saying where all this will stop.  Sure, after sudden
significant changes, up or down, it's perfectly normal to have a minor
snap-back.  But that's not the end of it.  It's got to run its course.
If it only would.  It happens so infrequently.  Exhaustion is a good
thing for investors, providing they have protected themselves during
the process.  That's when we can make some judgement of what stocks are
really worth.

I heard someone on a radio call-in show today who had "fallen in love
with the company".  He didn't want to hear that his choice was a wild
speculation, a "penny-stock" company that wasn't making money.  It's the
classic tyro's mistake, believing the old line that stockholders are
"buying the company".

Some portion of a stock price does represent the actual value of the
company, the rest is just psychological demand to have a stock everyone
seems to want.  The real value is "the bottom" where the Street widely
recognizes this is an undervalued stock, and they'll buy whatever is
offered.  It takes serious selling to drive prices down to those levels.

Recognize what I'm saying here is that we need to have strategies and
implement tactics to protect ourselves when the market turns down.  But
it's no time to panic!  If we're alert and aware, we can gain valuable
information during significant corrections.

 Price    Vola-    Momen-   Volume   Oscil-   Summ.
 Change   tility   tum               lator    Index
 -__+     -__+     -__+     -__+     -__+     -__+

 __>_     __     __>_     __<_     09/30
 _>__     _|__     __|_     __>_     __>_     __<_     10/03
 _|__     _|__     _|__     __>_     _>__     __<_     10/04
 __     _|__     ___>     _<__     __<_     10/05
 __     _|__     ___>     <___     __<_     10/06

Timing Signals:  I don't use or recommend timing signals, but they're
fun to watch.  If I did though, well, I might use something like this.
(Be warned!!  It tends to whipsaw around signal points!)

Last Signal: SELL       Date:  10/04/05 S&P:    1214
Winner or Loser:  Loser                 By:     -13

See my market tracking charts for '03-'04 and my investment strategy
study at my website(s):
http://www.xprt.net/~pgrogers/Pers.html
http://www.geocities.com/paulgrogers/Pers.html



Paul Rogers, paulgrogers{at}yahoo.com                       -o)
http://www.angelfire.com/or/paulrogers                   /\\
Rogers' Second Law: Everything you do communicates.     _\_V

... Bother, said Pooh, watching his email box fill with flames
___ MultiMail/MS-DOS v0.35

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