22 replies to this topic

[voecklen]

And you did nothing but confirm my opinion with your answer. Always have to be right. If it were me, I'd look to see what is being pointed out and maybe consider if I'm missing something. Not you. You HAVE to be right. You even bother to write small thesis why you're correct. Do as you wish.

Edited by voecklen, 29 September 2011 - 09:32 PM.

[DrSP]

And you did nothing but confirm my opinion with your answer. Always have to be right. If it were me, I'd look to see what is being pointed out and maybe consider if I'm missing something. Not you. You HAVE to be right. You even bother to write small thesis why you're correct. Do as you wish.

voecklen, You can always judge my acumen towards investing or trading. I welcome that because that is what we are on this forum. But, please stop judging me as a person. I never do that outside my family and friends and I don't welcome that when someone does it. I restrict the right to judge me as a person only to them as well. I didn't say I was right or wrong. I invited you to follow that link and read the text.

Please take a minute to go through the linked text and read in detail. Some of the study results include:

Out of 7 Intermediate-term Sell Signals, 4 were followed by declines within 3 days. 1 signal was followed by a decline within 5 days. 2 of the Sell signals only generated very modest pullbacks. The failed Sells were during pronounced Bullish periods. 5/7 of the Sell signals can be viewed as "accurate/profitable".

Out of 9 Intermediate-term Buy Signals, 7 were followed by rallies within 5 days or less. 2 signals were failures. Both were during the prolonged Bear market of 2008-2009. 7/9 of the Buy signals can be viewed as "accurate/profitable".

Out of 11 VST Sells 10 generated immediate or near immediate short-term sell offs. 1 sell off took 3 days and was considered the lone failed signals. 6/7 of the VST Sells were "accurate/profitable".

Out of 14 VST Buys, 12 generated appreciable rallies within 1-2 days. 2 signals failed to generate any tradable rally.

Your opinion on interpretation could be different, fine by me. I am stressing on the term "bear market" and applicability of rules in bear markets. It is upto you to do the same or opposite.

Edited by DrSP, 29 September 2011 - 09:43 PM.

[voecklen]

You're doing it again.

[arbman]

If the average long exposure is already very low though, you cannot expect much of a waterfall decline in a market by short selling alone. In that sense, it is quite possible that we are close to a few weeks low at least. I was thinking that some of the readings could get more extreme, but honestly if we are waiting only for people to load up the puts to extreme, it does not have to happen. The bottom line is we may be stuck in this BS range for several more weeks... However, I do not see the upside as explosive as the opposite of no water fall decline. In that sense, gold is much more open to further waterfall decline because it is still owned by many investors despite the decline and the leveraged gold buyers must be feeling a lot of pain lately, the decline probably wiped out many of them...

[DrSP]

If the average long exposure is already very low though, you cannot expect much of a waterfall decline in a market by short selling alone. In that sense, it is quite possible that we are close to a few weeks low at least.

I was thinking that some of the readings could get more extreme, but honestly if we are waiting only for people to load up the puts to extreme, it does not have to happen. The bottom line is we may be stuck in this BS range for several more weeks... However, I do not see the upside as explosive as the opposite of no water fall decline.

In that sense, gold is much more open to further waterfall decline because it is still owned by many investors despite the decline and the leveraged gold buyers must be feeling a lot of pain lately, the decline probably wiped out many of them...

I am taking the analogy of an indicator like RSI here. For example, RSI has reached 30 today. That is low and say a ticker has fallen 10% already. But, selling ensued in the coming sessions and as the RSI dips further, for every small value change in the RSI downwards, the % of ticker value will go down more and further. Indirectly it means the intensity of selling will increase as the readings go extreme. Same goes when the RSI is above 80 as well.

Here we have a reading of ~ 11% or so. For every small change downwards towards a reading of virtually 0, I reckon the crash intensifies. We could take a breather in between, like we have seen for the last 7 weeks.

If the average long exposure is already very low though, you cannot expect much of a waterfall decline in a market by short selling alone. In that sense, it is quite possible that we are close to a few weeks low at least.

The last part of the crash is caused by momentum chasers, not professionals. So, we could see the extreme. Like I said the extreme could come anytime in the next 2 months, we should just be cautious. One day, they will just drop us from a sky tower.

Good night to everyone!

Edited by DrSP, 29 September 2011 - 10:10 PM.

[pdx5]

Mutual funds cash position is barely over 2%. So that will not be much help for market support during a drop in stock prices.

http://home.comcast....Cash_Levels.htm

[OEXCHAOS]

The Median NAAIM pollee is FLAT. Zero long exposure.

This is how the market looked the last time we saw these readings.

Gracias Mark, and it only took a 20% or so decline in the indices to get it there, rather hard to believe

Senor

In fairness, "we should credit the 75% of surveyed advisors who have been roughly 50% or more out of the market for months."

These guys are actually pretty good, but like the rest of us, if we make precipitous shifts, or get leaning too hard there's a pretty good chance we'll be wrong.

Also, remember, these guys run real money. There's a real business cost to being out of the market or out for too long or out if it goes up. My opinion is that 50% or less long, even in a Bear market, is courageous for a money manager.

Mark

[OEXCHAOS]

The Median NAAIM pollee is FLAT. Zero long exposure.

This is how the market looked the last time we saw these readings.

At what point/date on the chart should I be looking at for the NAAIM being flat?

July, Oct. November-Dec, and then March.

[OEXCHAOS]

Mutual funds cash position is barely over 2%. So that will not be much help for market support during a drop in stock prices.

http://home.comcast....Cash_Levels.htm

I have some strong opinions on this--and am about to publish an article on such, as a matter of fact--BUT, I don't view this as meaningful to the market. The consultants drive the cash levels, not the management decisions of the advisors. It's just not a good timing tool.

M

[OEXCHAOS]

DrSP may well be approaching this situation correctly. It is instructive that the hardest trade for me (and I'm guessing many others here) is the "press", i.e. buying a really strong market, or shorting a really weak one, even though that trade is almost always profitable. We can see that one can reduce risk significantly if one waits for a turn or some more technical support before picking a low in a Bear. That said, I have been waiting to see 0% exposure levels before I even considered picking a low. We now have that, so now I can watch for a better bottom spotter Buy. Mark