7 replies to this topic

[dcengr]

Oh well. What will it take to see some fear?

[S.I.M.O.N.]

Oh well.

What will it take to see some fear?

depends on where you look, futrs traders are scared sh*tless, all over the tape.
who was buying all last night and after close, dumb money??? or who was selling??
brokers liquidating over-leveraged clients, imo.

[selecto]

"I beseech you not to grasp the knife... by its sharp edge... but rather, seizing it by its blunt side, use it to excise all the imperfections you may recognize..."

Suor Maria Celeste to her father, Galileo Galilei, 1630.

[tommyt]

What will it take to see some fear? the thought that its not going up anymore, and dump...thats what makes a low...meanwhile we get this, continuation...

[A-ha]

Oh well.

What will it take to see some fear?

You will be stunned by the bullishness when we test 1320...

Not a far distant, just 50 points left , that is less than Tuesday's drop ....

That is what bear markets are all about ...

And I suggest you better get used to hearing the following lines here and all over the media in coming months

bottom bottom bottom bottom bottom bottom ....
capitulation capitulation capitulation capitulation ....
buy buy buy buy buy buy buy buy buy buy...
oversold oversold oversold oversold oversold oversold....

Edited by xD&Cox, 05 March 2007 - 04:46 PM.

[greenie]

Oh well.

What will it take to see some fear?

It takes time to change human mind. For example, if you tell a lie to the crowd long enough, they will start to believe it, no matter how outrageous the claim is (intelligent design, global warming, peak oil).

For the same reason, sentiment of market participants changes based on the number of up and down days, not the magnitude of ups and downs in those days. For example, if we have 20 up days of 0.1% each and then one down day that wipes out the entire gain, people will still remain heavily bullish. If you look at the last rally, many were bearish from July to Nov, when the most spectacular part of the rally took place. Then, during the topping period from Nov to Feb, the price pattern was five small consecutive up days, followed by one large down, and it was enough to turn even the permabear blogger poll at tickersense bullish.

So, what I am getting at is that sentiment is just a function of price. When the price reaches the upper trendline, if the sentiment is bullish, market reverses automatically. If the sentiment is still bearish, market hugs along the trendline with marginal gains, until almost every bear turns bullish and gives up.


With that knowledge, you can go back and study the May '06 decline. The first part of the decline was sharp - why? Nobody would believe a decline, no matter how large, after such a long and spectacular rally (Oct to May). So, the market has to do its job, when nobody is watching. Then the bounce was shallow, because most participants were expecting large pullback (maybe rally back to the highs). As we proceeded with further declines, the slopes of the declines were smaller, whereas the bounces were sharper and sharper. However, people started to suspect bounces by then. By the end of it, everyone believed the bear market, even though the decline from mid July - mid Aug in NDX was really shallow. Then, we came out of it with a spectacular three gap rally. Again, the first move has to be sharpest, because the market has to fool most people.


If you work with momentum divergence, the same picture is integrated into your system. So, price, momentum, sentiment all are consistent, and you may be able to get similar information interchangeably from each of the indicators.

Edited by greenie, 05 March 2007 - 05:06 PM.

[Jnavin]

I experience fear -- lots of it -- every time I place an order whether it's a buy or a sell. Razor's edge every day.

[pdx5]

The fear is scheduled to start when SPX crosses below 1300. Until then it is a buying opportunity LOL