AEGEANCAPITAL

MARKET COMMENTARY NOVEMBER 2000

Thur. 11-30-00[Before the opening]

Yesterday's action was not all that bad, until after the bell, when GTW dropped the bomb about sharply lower earnings ahead, and no improvement over the next 12-18 months! If you recall, just 2 months ago, GTW was declared "immune" to the problems faced by other PC makers. The sharp decline in GTW, as well as, INTC, MSFT, ALTR, XLNX, in after hours trading, will cast a dark shadow on today's trading. There is not much to do, but wait until the selling pressure is exhausted, keep in mind NASDAQ has been declining for 3 months, hopefully, people will end up throwing the towel, resulting in a massive sell-off that will set the stage for a decent rally. BE PATIENT!

Wed. 11-29-00[Before the opening]

In our weekly report on 11-17-00 (see weekly reports) we showed that the probability for NASDAQ to reach 2450 over the following 10-5 trading days was about 44%. It now seems very likely that NASDAQ will reach that level. We think, that there is a good chance the continuation in the sell-off will finally produce the needed capitulation for a real rally to take place. Stay tight for the inevitable to happen!

Tuesday 11-28-00[Before the opening]

Yesterday, NASDAQ closed the gap that it left last Monday. By the same token, do not be surprised if today, it closes the gap that it left open on Friday at 2750. The markets seem puzzled and perplexed by the on-going political situation. It seems that it is now dawning on the market that after all, maybe this will turn into a mess! Although, our indicators are close to turning neutral from bearish, we do not think the market can be trusted.

Wed. 11-22-00[Before the opening]

Yesterday's action in the SP500 was somewhat positive, the same can't be said about NASDAQ. Although it fell only 5 points, declining issues outnumbered advancing ones almost by 2:1. Our short-term volatility model indicates that we will see an uptick in volatility over the next few trading days, with a move in the popular indexes in excess of 5% intraday

Tuesday 11-21-00[Before the opening]

Given a) the deteriorating condition of the markets and b) that our regression model (see "weekly reports") gave a probability of over 40% for a decline in excess of 10%, we would not be surprised to see some sort of a climactic selling in NASDAQ approaching 2400-2500.

Friday 11-17-00[Before the opening]

So much for positive action! The market yesterday, reversed the good behavior that it showed on Wed. creating the likelihood of another leg down. If it happens it could be a gut wrencing one. PLEASE VISIT AGAIN SAT. AFTER 12:00noon FOR OUR DETAIL WEEKLY REPORT

Thur. 11-16-00[Before the opening]

Yesterday's market action was encouraging. We find it particularly positive that the market held up, despite the FOMC announcement to keep its bias unchanged. We may some weakness early today, but the market should recover and probably head higher until Friday.

Wed. 11-15-00[Before the opening]

In our newsletter, we indicated that there was a good chance the market may find a short-term bottom around 2850. It appears that it did -at least for one day. Our short-term timing model, is very close to turning bullish. If volume yesterday was higher -it was pretty anemic- it would have turned neutral already. So, we got to wait and see how things develop today.

Tuesday 11-14-00[Before the opening]

As we noted in our newsletter, there was an 82% probability that NASDAQ would reach 2850. We accomplished that yesterday, we do not see -for the time being- down side risk exceeding 2700, thus we have started to nimble. In our managed acccounts we commited 30% of the portfolio being long BHH, and we will add to our positions in any weakness towards 2700-2750. The market -if it continues- on the down side, it has at the most 1-2 days of negative action before it rebounds.

Monday 11-13-00[Before the opening]

Please read this month's newsletter that we just posted on Sunday night

Friday 11-10-00[10:00am PST]

We expect the sell-off -due to the political situation- to end sometime within the next 2-3 days. We do not think the current crisis will go on for too long. Thus, a sharp relief rally should take place within the next few days.PLEASE VISIT AGAIN SUNDAY 11-12-00 AFTER 2:00 PM PST FOR THIS MONTH'S NEWSLETTER

Thur. 11-9-00[before the opening]

As we mentioned on Tuesday (see below) our short-term model turned bearish yesterday. The target price for NASDAQ (see weekly market updates) is 2950. However, if indeed the election results are released today, we should have a relief rally. Whether the decline resumes, or the rally continues in the end of the year, we got to wait and see.

Wed. 11-8-00[before the opening]

Our short-term model turned neutral yesterday. We may have a one-day celebration after the final results of the election are announced, but after that celebration we believe the market will begin to consolidate its recent gains before moving higher.

Tuesday 11-7-00[before the opening]

As we mentioned in our weekly report, the ratio between the bullish and bearish scenarios is continuing to shrink. We expect the model to change from bullish to neutral by day's end, thus, signaling the potential transition to a sell signal within another day or two. The popular indexes (SP500 and NASDAQ) appear to be laboring a lot without much improvement in price. Putting all together, it seems to us, there is going to be a post-election pull back.WE ARE RAISING THE WARNING FLAG ON THE FIBEROPTIC SECTOR. IF THEY FALTER AT THIS POINT, GET OUT OF THE WAY!

Friday 11-3-00[before the opening]

The initial target price for NASDAQ -according to the probability scenario we posted in last week's "weekly update- was 3450. NASDAQ is only 30 points away from it, if it gets thru it, the next target could very well be 3650. As far as the SP500 goes, its chart formation could be interpreted as "rising wedge" which short-term is bearish. Given its huge advance from its October lows, a re-treat of 25-50 points should be in the cards.

Thur. 11-2-00[before the opening]

Given the strong advances that all three indexes have experienced -from their recent lows- a consolidation is to be expected. We do believe that we are in the early beginings of a year end rally. However, any long positions should be established with "tight sell stops" to avoid incurring unwarranted losses by a market that acts in a rather manic-depressive manner!

Wed. 11-1-00[before the opening]

The strong advance that took place yesterday, is a prelude of a year-end rally. Although, some selling may re-occur over the next few days, the markets should work their way higher. In our managed acounts we opened a 40% position in the QQQ.