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#21 fib_1618

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Posted 07 January 2010 - 05:14 PM

Reality has little comprehension to someone who is on crystal meth and keeps getting a continuous fix.


I honestly took this personally, I am very sorry... I guess you meant the economy...

I can see how that could had been misinterpreted. Yes, I was talking about the markets.

Fib

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Wise men don't need advice. Fools won't take it. - Benjamin Franklin

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#22 arbman

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Posted 07 January 2010 - 05:23 PM

I think you were right for a top later in January, I've been hedging my bets and waiting for the crowd to line up on the other side of the trade. We got it now, so I think we should sell on good economic news from here and then carry on higher until the correction. I still expect a correction into March, but I think I've been too early on this one. If the market does not sell off below 1115 in the next few sessions, I will close these trades and take short term long positions until there is a better entry for the correction theme, hedge at 1146. Commercials are short the 2yr and long the 30 yr bonds, basically they think the yield curve will flatten from here. The equities will probably go higher in the mean time until late summer at least...

#23 zman

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Posted 07 January 2010 - 05:34 PM

I since the bottom to be in the summer, then just go long and enjoy the rest of the year
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#24 IYB

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Posted 07 January 2010 - 05:51 PM

I still expect a correction into March, but I think I've been too early on this one...... The equities will probably go higher in the mean time until late summer at least...

Arb, you confused me with the above. Are you saying you still believe we are on the verge on a correction or that you now do not expect one until summer? Always interested in your view of things. TIA and very best, D
“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one.” Charles Mackay, Extraordinary Popular Delusions and the Madness of Crowds

#25 arbman

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Posted 07 January 2010 - 06:16 PM

I still expect a correction into March, but I think I've been too early on this one...... The equities will probably go higher in the mean time until late summer at least...

Arb, you confused me with the above. Are you saying you still believe we are on the verge on a correction or that you now do not expect one until summer? Always interested in your view of things. TIA and very best, D



I am sorry for not being clear, I think the correction will happen later in January into February and we should mark the final lows by the first week of March. The trend is strong and similar to 2007 rally, we will get a huge 1-2 day significant decline at some point, I do not want to be caught into that move and hence I am not interested in the intermediate term long positions until it happens, then just like in 2007 we will probably see the monetary overdrive into summer...

I truly sucked with my immediate correction call, didn't I? "Don't fight the Fed" has become the theme of the game again, but hopefully even Fed will recognize that the hard earned taxpayers dollars are now going to pay off the gold speculators and the public nicely lined up against the criminals in equities... You'll never know a correction or a pull back may work!!! :lol:

Bernanke is like a mad scientist though! Very best... :)

#26 fib_1618

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Posted 07 January 2010 - 06:21 PM

I still expect a correction into March, but I think I've been too early on this one.

I'm going to say something here, and I don't want you to think it as being condescending as was the case before:

When the McClellan Summation Index is as high as it is right now, it is downright impossible for an opposing trend to develop, no less, more than anything of a 2 day rest against the direction of the prevailing trend. It is what it is. It's the physics that drives the markets. Today was a good example of this buoyancy...a hard sell off followed by an equal and opposite move once the selling pressure was relived. It's like taking a basketball into the deep end of a swimming pool - you may be able to push it below the water level, but if you let up in any way, its going to rise back up to the surface. The more energy you apply to this same object, and the deeper you try to go, the faster and higher the rebound will be once it moves back up above the surface.

So...you might get your correction into March, but the real question becomes: from what level will this correction start?

Then you'll have these additional questions: how much will this correction cover? Will it be one of price, time, or both?

Without knowing the trend of liquidity and its buoyancy, questions like this are extremely difficult to answer no matter how good you are or how much experience you have. Your opinion, my opinion, everyone's opinion is only tradable IF the market dynamics suggest that it can be accomplished. This is why it's highly important to follow the rhythm of the markets and fight the urge of trying to outsmart it. You won't be able to. Far better to go with what the market gives you than to try to force your opinion on what it should do and when it should do it.

You'll eventually be right, I suppose, it's logical and reasonable. But everything in this business is based on timing. You can either swim with the tide, or fight your way to shore. Personally, I've found it's far easier to just go with flow and let others battle it out between the whys and wherefores as personal opinion is given little respect towards your trading accounts bottom line.

Fib

Better to ignore me than abhor me.

Wise men don't need advice. Fools won't take it. - Benjamin Franklin

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#27 andiron

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Posted 07 January 2010 - 06:22 PM

correction to 1030, then a retrace and then another leg down to 960 or so...followed by another ramp up to 1100-1200 ...

#28 arbman

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Posted 07 January 2010 - 06:37 PM

I completely respect your opinion Fib, but the February 2007 decline came very similarly, same for May 2006 decline. The difference was the public was speculating, over speculating... Just like now. We will get a very very good shaker and then continue higher, that I now agree... I will buy and speculate a bit long if we get a good decline that remains over 1115 for a week or two, then I think we will get closer to breadth exhaustion... Can we totally blow off instead? Sure we can, but it could do so over the past 400 points and for some reason the blow offs are also prevented, just like the corrections... Andiron, your prediction is the sane one, we are dealing with an insane scientist though, be careful. I think it will be more like a correction to 1050-1060 from 1150-1160... Some people very successfully called it, this decline MAY come when everyone is convinced that 1125 is taken out for good... (edit: if it doesn't correct immediately from here, not much of an error tolerance is left here)

Edited by arbman, 07 January 2010 - 06:46 PM.


#29 IYB

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Posted 07 January 2010 - 07:48 PM

You can either swim with the tide, or fight your way to shore. Personally, I've found it's far easier to just go with flow and let others battle it out between the whys and wherefores....

Once again, Fib, well said. :)
“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one.” Charles Mackay, Extraordinary Popular Delusions and the Madness of Crowds

#30 arbman

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Posted 07 January 2010 - 09:09 PM

OK, here's my plan from here... I think if we do not open below the 50k high volume stick in futures tomorrow, ES March 1135, or test it tonight and rally off of it by European open (sometime 2am PST), I will go long a bit and hedge and wait till the open for a gap up. There is another 10 points upside from 1135 and thereabouts. I think if we blow off in the morning --and it is highly likely, it is a much better place to start a pull back. If we close at the highs tomorrow, the chances for gap down is very very high for Monday, or vice versa... A gap up is to be sold and to be bought for a closing rally, if it doesn't drop below 1135 etc etc... If the closing today was the blow off, we should quickly reverse below it in the morning and start a pull back...