44 replies to this topic

[arbman]

Let me clarify though, we just tested the high volume top and gap at 920 with less volume, this is bearish immediately, so we will sell down, probably lower into next week and then a bounce, if that bounce does not slow it down, the next rally or spike into early June will not make to a new high and then the down trend may accelerate into a crash later in June depending on how much the market stretches there...

[da_cheif]

IYB-Simple, elequent, and proven-love the way you work!
Money-Frontrunning is something you may want to weed out of your trading style-the rewards are small compared to the total gain available-and on the other hand-the punishment can be severe.

Thanks Spooky. I think several here missed or are choosing to ignor your very important point. Why not wait to talk about "the bull market" until we are above a rising 13 month (or 50 week, or 200 day) moving average, rather than speculate on the HOPE that this will eventually happen this time. In 2003, all you had to do was wait about 5-6 weeks off of the March 12 bottom, and you had your bull market confirmation.....and 4 1/2 years of clear sailing ahead. Doesn't that make more sense than guessing and hoping, now ---- with REAL MONEY??

If you are so certain that this is a bull market that you would risk your hard earned money on that premise, then surely you won't have long to wait 'til you get the confirmation of which I speak. Come back and have this discussion then. {As Ross Perot used to say}"I'll be all ears."

Or how about the vix below its 200 day moving average...or the naz comp....or the naz 100...or the broadest measure of market activity the VLE......above their 200 day moving averages......which they all are....

Edited by da_cheif, 19 May 2009 - 08:12 PM.

[arbman]

>there is no fundamental basis<......there never is......till mucho higher prices........then we hear........"Oh I see"..... smile.gif

Cheif, I like your optimism, but I must say the leadership in the indices and sectors is not there anymore, we are building a top here. It may rally higher, but lower than these levels will be seen by the end of June, imho. This is already too early too far, especially higher is disaster in my view...

[da_cheif]

>there is no fundamental basis<......there never is......till mucho higher prices........then we hear........"Oh I see"..... smile.gif

Cheif, I like your optimism, but I must say the leadership in the indices and sectors is not there anymore, we are building a top here. It may rally higher, but lower than these levels will be seen by the end of June, imho. This is already too early too far, especially higher is disaster in my view...

arb....i like ur pesimism.....u hava lot of company.......and thats a good thing.......specially after 2000 dow pts off the recent low.....and 6800 dow points off the last crash low......ever see a bull market start otherwise????......not me in all the 40 years i been doin this

[Gary Smith]

Based on not only the number, but the magnitude of the thrust off the March lows (Zweig's 9 to 1 thrusts) the likes of which I have seen but once in my lifetime (1982) and the price action in junk bonds/credit spreads my vote is bull market. Then again, I play every momentum low as if it is THE low and have been wrong several times in the past 18 months. That is why money management is such a critical element in trading. The best money is made coming off bear market lows and I sure would have hated to have missed this recent ramp up, especially in my preferred trading vehicle, junk bonds, which I can play as aggressively as possible because of their trend persistency and lack of volatility. Another different factor in this ramp up has been the reaction on some of the other boards. For example, one board where I have been a long time lurker use to be a buy and die, stocks for the long run board. But the bear market has now transformed it into a board of scared investors who are underinvested out of fear of the next shoe to drop.

Edited by Gary Smith, 19 May 2009 - 08:28 PM.

[ed rader]

bears: if this really WAS the start of a bull market what would be different?

the consumer would be buying.

ed rader

[MoneyFriend]

the vix would be below 30 oh .... wait .....

[arbman]

>there is no fundamental basis<......there never is......till mucho higher prices........then we hear........"Oh I see"..... smile.gif

Cheif, I like your optimism, but I must say the leadership in the indices and sectors is not there anymore, we are building a top here. It may rally higher, but lower than these levels will be seen by the end of June, imho. This is already too early too far, especially higher is disaster in my view...

arb....i like ur pesimism.....u hava lot of company.......and thats a good thing.......specially after 2000 dow pts off the recent low.....and 6800 dow points off the last crash low......ever see a bull market start otherwise????......not me in all the 40 years i been doin this

I am not as pessimistic as I sound, I just think there will be a pretty sharp correction down later in June. I think the lows are in for 2009 and we are about to set the highs. I think there will be lower lows in 2010 once this rally does not follow through. So, I expect the year to close slightly down, it is too early though...

The way I see is the monthly momentum lows must be tested, this is not a V-bottom, bookmark this!

[thespookyone]

[quote name='MoneyFriend' date='May 19 2009, 09:30 PM' post='455559']
the vix would be below 30




oh .... wait .....

The market would have flown instead of dropped as the VIX got hammered under 30 today.

[IYB]

That's where your 7 sentinnels pay of. In this case the indexes are so far below the 13 month ema that should we see a u shaped recovery and a cyclical bull one would miss 1/3 to half of it IMO.

Very intelligent diagnosis & prognostication. If one waits for the index to cross above 13 month,
one has missed a huge part of the advance. Like missing 37% advance from March lows.
Also it is mathematically impossible for the slope of any moving average not to show inflexion
after a 37% advance. It is difficult to see that 13 MA line because of the scale.

When a real bull market starts, it starts from close enough to the 13 month MA, and from a decelerating slope just like in 2003- so that a punch through the MA and an upturn in the MA comes very easily. Go back and check you will see this over and over and over for as long as records are available. This is what we technichians like to call "a base", or the "base building process".

As much as people like to hope - as they did all through the long grinding period of 2001 and the even longer (for the bears) exhausting period of 2002, that "this time it will be a V- bottom!", or maybe I should say fear that "this thing will just go straight up and leave me behind"......markets just don't work that way. They go through cyclical declines, they have long periods of base building, and they eventually punch through and begin the new bull phase-- usually about the time the "too early bulls" have finally thrown in the towel. The same will happen this time. This market WILL build a base over a prolonged period before a new bull market emerges. And that may mean more tests of 666-- or that MAY mean further new lows into the 500's or lower. But it will start a bull market from a base.

What we are discussing here is probably the simplest conceivable tenant of Technical Analysis- and that is this: Is this a bear market or a bull market? If one has a chart right in front of himself and can clearly see that the monthly moving average of price is falling rapidly, and STILL wants to argue that this is a BULL market.....then I don't know why the heck I'm spending my time arguing with him. Over 'n' out.