It seems to me that with the market we have been experiencing over the last 18 months that there is an awful lot of overhead resistance. How is this market going to recover anytime soon with everyone, who has bitten the bullet on their stocks over the 18 month period, just sitting there waiting to pull the trigger and get out of those positions the minute they reach breakeven or less? Maybe a lot of these would be sellers have already taken their lumps and sold but that's just the way I see it. (November 6, 2001)

  Your underlying premise is absolutely correct: time will wear out most buyers no matter how high they bought. Indeed that is the theory of basing stocks: loss of value and time weed out the sellers. They give up and move on. A lot of sellers got out of dodge last fall and earlier in the year after rally attempts rolled over and failed. The last leg of the bear market in the spring shook out many. The summer rally brought some more in. The market hit a new low. The four months to the bottom was not enough to shake them all out, though the drop below the spring low did clear out many. There are trillions of dollars in money markets; some of that came from stock sales. Still, there are investors holding onto stocks from 12 or months ago; they may just continue to hang on and ride them back up. The near term overhead, that from May is still key. It is very similar to the middle hump in a double bottom pattern, and clearing it will be a huge turning point in the market (that level is 2328.05).

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