Three times this year prices have reached the 1155-1158 level, and "been
turned back" the next day.  Four times if you want to count a rapid
"stutter" a couple weeks ago.  That is how technical resistance levels
are created.  It's less about some hidden property of that price level,
and more about creating the appearance of an inability to go higher
which some "technical analysts" tout, investors respond as if it were
really true, so it becomes true.  It's a self-fulfilling prophecy.

Today was the third time it retreated, and volume increased marginally
over yesterday.

You'll remember I was questioning what was causing the heavy volume back
in January, wondering if it was professional profit taking.  I think
it's beginning to look like it.  So a technician would start asking
"where is the support level?"  Last winter's Rising Tops resistance line
might no be support.  You'll remember I mentioned that a couple weeks
ago, talking about a "Pennant Formation".  Today that line is down at
1110.  More worrysome, the 50-Day Moving Average is up to about 1130,
and penetrating that is a signal many investors will respond to.  Prices
don't have much leeway!  This is much like the formation we had that
ushered-in the Bear Market, though it's shorter term, hence weaker in
nature.  Still if investors get scared the Bear is returning, they may
create another self-fulfilling prophecy.

In this situation, the rally is over.  My Buy Signal was back before
Thanksgiving!  How much longer did you expect it to run?  If I was
sitting on a position that was marginal, I wouldn't be waiting for a -7%
drop from my purchase price to trigger the "7% Solution".  I'd accept
the fact that my stock isn't strong enough to swim against the tide (or
it would already be in profit, right?), and sell it even if all I could
get was my purchase price, less commissions.  "You've got to know when
to hold 'em, know when to fold 'em."  If you're going to buy stocks, you
need to be able to SELL stocks.

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

 __<_      _|__      __|_      _<__      _|__      ___<     02/25
 __|_      __      ___<     02/26
 __|_      __      ___<     02/27
 __|_      |___      __|_      __      ___<     03/01
 _>__      |___      __|_      __      ___<     03/02

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: BUY        Date:  11/24/03 S&P:    1052
Winner or Loser:  tbd                   By:     tbd

See my market tracking charts for '01-'02 and my investment strategy
study at my website(s):
http://www.xprt.net/~pgrogers/Pers.html
http://www.angelfire.com/or/paulrogers/Pers.html
http://www.geocities.com/paulgrogers/Pers.html

                                                           



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

... They also surf, who only stand on waves....
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