5 replies to this topic

[denleo]

I will sell the rest of my stocks tomorrow into strength. Before I continue, note: when I say something bearish, it does NOT mean any nonsense like "bear market" or "huge sell off" or "crash" or "I bet on the downside". It simply means that the risk of holding longs any further is higher than I like. While the price trend and breadth continues to be positive, there are several developments that tell me that I will be able to reenter the market in a few days/weeks at the same level or lower if I chose to do so. 1. Volatility. It is not just VIX being around 10. There are literaly hundreds of stocks and ETFs showing real and implied volatility at crazy low levels. I see big traders selling puts and put spreads with 20 to 1 risk to reward ratios just to make a buck. Vol traders are getting stupid. I have seen this before -- they usually get punished for that. 2. OEX p/c ratio bothers me a lot. It could be a bad sell signal, but (as we discussed here before) it worked very well over the last decade or so. It is simply hard to ignore. 3. Today's new highs came on the lowest volume of this year on S&P 500 and NYSE. No, it is not a holiday. Noone I know is on vacation. 4. Most indexes are simply getting overbought on both daily and weekly charts. While it does not mean a top right here right now, it is a warning sign, which makes me uncomfortable. 5. While I don't pay too much attention to sentiment, I noticed that there was not a single bearish opinion on Bloomberg TV today. It bugs me a little. 6. Mortgage stocks. They are getting killed. I don't like that. 7. My Cumulative Tick (it has nothing to do with closing NYSE Tick as I explained million times) is flirting with a sell signal. I am scared when I see that. Keep in mind that breadth and price are still very positive, and NASDAQ and Russell and mid caps are doing fine, which probably means that the market is still fine, but I just don't like this market any more. Denleo

[esther231]

Always appreciate your updates. Much thanks.

[arbman]

ditto, thanks! You should also add the decline in the open interest since January too. The big changes in the open interest are never good after a big run up, esp when the commercials are positioned at the opposite side of the trade... - kisa

[Rogerdodger]

Thank's for your posts.
I'm kicking myself right now for ignoring you on this one 2 weeks ago:
http://stockcharts.c...4129&r=8270.png

[OEXCHAOS]

I'm not! I bought the break out. Surprisingly good performance. I may take some off the table, though.



Mark

Thank's for your posts.
I'm kicking myself right now for ignoring you on this one 2 weeks ago:
http://stockcharts.c...4129&r=8270.png

[CLK]

The 45 level should be interesting, could go parabolic.
Got a little bit of a fractal going too.

Edited by CLK, 21 February 2007 - 02:50 PM.