Without a business turnaround in sight and continued layoffs, there is no reason for consumer confidence surveys or GDP forecasts to be upwardly revised. The negative data provided above still favors limited upside for the tech heavy Nasdaq. Going forward, I will continue to use tape principles of accumulation and distribution, participating with the minority, only to unload positions to the majority at some point later in time for profit. Learn to see what the minority sees. The market is a discounting machine.
Stocks move up on bad news and fall on good news.
Expected rate cuts, which should be good for the market, leads to a market sell off. It s not just ironic that since everyone expects it, it hasn t happened yet. This is just another great example of the market doing the opposite of what the majority expects. In next week s article, I plan to show you how and why the market discounts future expectations to protect you from chasing the trend at it s extremes and prepare us for the latter half of 2001. For now, if you want to be a tech investor, don t get caught chasing moves off bottoms.