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Beta Test Update



• Despite yesterday's decline in the major equity indices, the history of this uptrend suggests more time and price weakness is needed to generate a sufficient level of sustainable buying interest.

• The quickest correction in the NDX after such high overbought percentages (as outlined in "Beta Test - 10/20/03) was 9 sessions. Yesterday was only the 3rd session after such high readings and represented about 2% of downside action. The average correction from overbought extremes since March has been 14 sessions and 4% decline. Even in a best case scenario since March, the NDX should be less than halfway there in terms of both time and price.

• Despite the feeling that yesterday was dramatic, the last correction in the NDX began exactly one month ago on 9/22. That correction began with a 2% gap lower day and dropped nearly 7% until the low on 9/30. A similar occurrence would put the NDX at 1325ish on Halloween. Boo! The good news is even that kind of decline would again represent a higher low.

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