When Will The Market Bottom! Well Something Different To Think About!

Convential wisdom tells all in the market that the stock market will bottom 6-12 months before an economic recovery. Remember this is what many believe. In markets never seen before, something else can happen and it is happening right now by analyst revisions of earnings estimates. What you are witnessing is the market following the economy lower. The market will not bottom until the economy bottoms. I know many will or may disagree with this. Everything points to this. If I am correct than this market will become the greatest trading market many have ever seen. This is only my second post here. I have read here from time to time, but decided to start posting. Currently shorting the global stocks markets as of this past Monday. Positions in BGZ, TZA, DPK, & EDZ. Will add the Proshares FXI double inverse negative ETF next week sometime. Will hold these trades during a time frame of the next three weeks. Good luck, take care, DL

Convential wisdom tells all in the market that the stock market will bottom 6-12 months before an economic recovery. Remember this is what many believe. In markets never seen before, something else can happen and it is happening right now by analyst revisions of earnings estimates. What you are witnessing is the market following the economy lower. The market will not bottom until the economy bottoms. I know many will or may disagree with this. Everything points to this. If I am correct than this market will become the greatest trading market many have ever seen. This is only my second post here. I have read here from time to time, but decided to start posting.

Currently shorting the global stocks markets as of this past Monday. Positions in BGZ, TZA, DPK, & EDZ. Will add the Proshares FXI double inverse negative ETF next week sometime. Will hold these trades during a time frame of the next three weeks.

Good luck, take care, DL

i think the final bottom is at least two years away and it will be L-shaped. this isn't a normal business cyclic. this is something far more ominous, imo.

ed rader

hey mr. ed radar....just noticed the edradar zenfolio link on your signature....killer pics man.....make for some nice desktop backgrounds!

When? Don't know and don't care. What I do care about is positioning in sync with the current trend which is down. We will know when the bottom was at some point in the future, as soon as the trend has turned up, but only then by looking back.....just as we now know when the top occurred by looking back at where the trend turned down in late 2007. I think we hinder our trading performance by thinking and speculating about what WILL be (or MIGHT be), rather than keeping our trading focused on what IS....jmho, D

Convential wisdom tells all in the market that the stock market will bottom 6-12 months before an economic recovery. Remember this is what many believe. In markets never seen before, something else can happen and it is happening right now by analyst revisions of earnings estimates. What you are witnessing is the market following the economy lower. The market will not bottom until the economy bottoms. I know many will or may disagree with this. Everything points to this. If I am correct than this market will become the greatest trading market many have ever seen. This is only my second post here. I have read here from time to time, but decided to start posting.

Currently shorting the global stocks markets as of this past Monday. Positions in BGZ, TZA, DPK, & EDZ. Will add the Proshares FXI double inverse negative ETF next week sometime. Will hold these trades during a time frame of the next three weeks.

Good luck, take care, DL

i think the final bottom is at least two years away and it will be L-shaped. this isn't a normal business cyclic. this is something far more ominous, imo.

ed rader

True, maybe even longer. Just playing for what I know right now. Take care, DL

forget the "when will" for the IT: it HAS bottomed! what you see in the daily chart for the last two days was called, by the oldtimers, "cocking the hammer." and the gun is aimed right at the brains of the bears/shorts who don't duck quickly.

When? Don't know and don't care. What I do care about is positioning in sync with the current trend which is down. We will know when the bottom was at some point in the future, as soon as the trend has turned up, but only then by looking back.....just as we now know when the top occurred by looking back at where the trend turned down in late 2007.

I think we hinder our trading performance by thinking and speculating about what WILL be (or MIGHT be), rather than keeping our trading focused on what IS....jmho, D

Don't care Mr. IYB,

But care about how to position yourself, that is what I was trying to explain. Okay, just MHO market goes lower into FEB. Because of earnings season, which is 1/2 way done. Market can then rally after all bad news is out on earnings adjusted income for companies. Then down after that as they fail to realize real earnings again. No one will know the bottom until you reach levels in the S&P not seen before. I never look back, only foward, at any given time each market correction will result in stocks you want to own, depending on how secure their dividend is.

All the pro's knew it was a market top in through OCT-NOV 2007, reason is because of earnings and the market reaction to share prices. Although some share prices in the energy sector were still in play.

So for everyone here, what is going forward!

I have learned from the best Mr. IYB. You can take it or leave it as far as trading goes. I do not mean to argue with you if you take it that way. Trading on a day to day basis when a trend is not in place has to use T&A to limit a loss. When a certain trend is in place you do not have to limit your capital to a trade as long as a trend is in place. The trend is lower for the overall market right now. Based on options buys for puts on the $SPX. These puts have certain sell orders at a certain price on the S&P 500. This is not for sure because no one knows what the market will do. But, I will increase short positions next week, going against institutions is stupid.

If I can give you a clue, then it is possible for the S&P 500 to hit 500 in the first half of the year. Its more of an art then a science.

Take care, DL

forget the "when will" for the IT: it HAS bottomed!

what you see in the daily chart for the last two days was called, by the oldtimers, "cocking the hammer." and the gun is aimed right at the brains of the bears/shorts who don't duck quickly.

We will see, stick to my guns, like all of you. Sticking short into the first 3 weeks of FEB. DL

The last two years we have had the "Beware the Ides of March" effect. I am looking for a low (not the bottom) in March.

Convential wisdom tells all in the market that the stock market will bottom 6-12 months before an economic recovery. Remember this is what many believe. In markets never seen before, something else can happen and it is happening right now by analyst revisions of earnings estimates. What you are witnessing is the market following the economy lower. The market will not bottom until the economy bottoms. I know many will or may disagree with this. Everything points to this. If I am correct than this market will become the greatest trading market many have ever seen. This is only my second post here. I have read here from time to time, but decided to start posting.

Currently shorting the global stocks markets as of this past Monday. Positions in BGZ, TZA, DPK, & EDZ. Will add the Proshares FXI double inverse negative ETF next week sometime. Will hold these trades during a time frame of the next three weeks.

Good luck, take care, DL

DLF,

Thanks for your post. I think the conventional wisdom regarding the market bottoming 6 months ahead of the economy needs to be scrutinized. I hear it all the time as people predict a market bottom based on a prediction of an anticipated upturn in the economy. The first uncertainty is when will the economy turn, which is debated ad nauseum. The second, which I have not heard mentioned, is whether the market will be able to anticipate this and bottom ahead of the economic bottom. That gets to visability, which I think is a real challenge in this bear. So thanks for raising the point. While not TA, I found it both profound and good food for thought.

By the way, IYB's post sounded a bit harsh, especially in response to a new poster, but I'm sure he didn't mean it that way.

Thanks again for posting.

Lev

Edited by leverage4, 31 January 2009 - 10:59 AM.