5 replies to this topic

[nimblebear]

Nobody on financial shows is bearish. Herb Greenberg showed a hint of it. Everybody is trying to run an excuse for the 200 point BLIP, that went down. One person says its one trader. Another person said people couldn't keep up with machines. Another says its ETF's. Off the chart Trin today. Collars broke down and didn't work. Most Everybody saying economy is "sound." All of this may be true. However when Shang em Hi, opens and goes down further, I think a lot of people here in the US just might start selling to take profits. This could then accelerate into something not intended. People may also not be comfortable with a system that appeared to not have worked. Though it sounds like an excuse, it is actually rational to think that after all the TA that has worked so well to this point, pyschology could take over. And people may appear to be acting irrationally. It may take a while for some people to get back some sense, but this time might take a little longer than on previous occasions. For example, Mutual Funds with very low cash levels, (which they are the lowest in quite some time), could have trouble, having enough money to cover sell orders. ETF's set up for shorting could force some very big money in the wrong direction. And I think it was unusual that there was not a major event (like Terror) that caused it this time. Just a few dominoes lining up, and some people (gov't, etc) saying the wrong things, and people start to all get greedy and try to KEEP some gains. And who knows what could happen to derivatives, if massive and multiple trades need to be unwound. I think the best example of the pyschology of this market is the TV show Deal or NO DEAL ! People want that Million, and after a period of time of bank offers going up and then back down when the perceived probabilities change, they finally say Deal after a lot of money has left the table. Very few hang on to the bitter end, and still fewer get the maximum offered by the Bank. The market (like the Bank) has just begun to "lower its offers." Do they stay in and "wait" for the higher market, or do they try to leave now and profit? Unlike Deal or No Deal it is not just one person's psychological make up. It is many obviously. That is why I think a lot of factors will come into play, and the market will head downward, possibly very deeply, and against the TA indicators, likely very steeply. The great traders on this board will probably not be too affected, I suspect. Stay well, and Prosper !

[ed rader]

your posts are cascading too . ed rader

[esther231]

Ed, GREAT PICTURES.

[ed rader]

Ed, GREAT PICTURES.

thanx Esther !

ed rader

[pdx5]

Nimblebear...good post! My thought is to watch China index carefully. If Shanghai has another meltdown soon, then all other markets will react in sympathy. I understand the Chinese are using their stock market as a casino since they have no legal gambling in China. J6P are using credit cards to buy stocks since the stock market was in a parabolic move up. The Shanghai could easily drop another 20 to 30%.

[skunk]

Nimblebear...good post!
My thought is to watch China index carefully. If Shanghai has another
meltdown soon, then all other markets will react in sympathy. I understand
the Chinese are using their stock market as a casino since they have no
legal gambling in China. J6P are using credit cards to buy stocks since the
stock market was in a parabolic move up. The Shanghai could easily drop
another 20 to 30%.

SHHHHHH! ---- I have been trying to convince my wife this trading I am doing is NOT gambling!