7 replies to this topic

[Sentient Being]

I know some here are very bullish but there are some things to worry about. As a long in SPY and QQQQ with stops in place I've made my bet some time back but have concerns. 1) SPY topped out two months ago and we are still below that high. How many more months can we still say the bull market is continuing? 2) I have a daily custom momentum indicator that shows SPY higher in momentum than it has ever been. It's looking like a real extreme. You know, I wanted to count this as a negative but there have been times in the past where the real upside in price action didn't occur until after momentum peaked and turned down. 3) Spy has not been able to close above the high of last month, or the LOWER high of earlier this month. 4) The 50 day moving average has been working as resistance, closes above it lasting no more than one day. I don't think it will hang here much longer, a new direction is due to hit. 5) The 21, 50, and 200 day simple moving averages seem to be converging as price consolidates. So consolidation and new direction to reveal itself, soon, I should GUESS. I would also guess that the rate cut or lack of rate cut might serve as the Catullus for the next move. It may be a "non event" if it's 1/4 point but it's the non event that would allow the market to rule out other extremes of possible fed action and to move on to a new direction.

Edited by Sentient Being, 17 September 2007 - 12:32 PM.

[hiker]

it looks bullish (barely) till it fails

just guessing that a beautiful setup is a downside retreat to 1461-1463, for some rally relief...followed by a move back up

weekly and 1471/72 S2 marked

Edited by hiker, 17 September 2007 - 12:54 PM.

[eminimee]

Here's an example of a consolidation/sideways market for a year in a bull market. fwiw....

http://stockcharts.com/c-sc/sc?s=$COMPQ&p=D&st=1994-01-01&en=1995-06-01&i=p26641321684&a=116040527&r=4643.png

[Islander]

Expectations Rule the market. The Fed comments matter greatly, The market expects, and has priced in, a series of cuts over the near term. If anything derails that expectation the market will reprice itself - downward. Longer run a series of cuts debased the buck and inflates the hell out of the US economy. Greenspan said in one of interviews on CNBC today that he expected the 10 year at 8% in the next "couple of years". I agree it leads to Inflation. I hold a 20% gold hedge and a put on a ladder of bonds. Best, Islander

Edited by Islander, 17 September 2007 - 01:24 PM.

[relax]

disagree that repricing will occur downwards I have seen the market going from expecting a rate cut to not expecting it without too much downside really depends on the reason currently there is also a lot of recession priced into the market therefore one could argue that repricing could mean upside if chances of a recession move more towards 0 per cent after tomorrow and any rate cut, fed funds and maybe also discount rate, then I think the market will prefer seeing good data, even though it may eliminate the need for a further rate cut nonetheless, all this talk just gets me confused let's see what price tells us the next couple of days what about inflation data - would it not be "embarrassing" if core inflation data was too high to justify the rate cut we are all expecting then again i'm sure benny can control the illusion of core inflation to suit his strategy cheers guys - exciting couple of days - "i see a big move coming up"

[Sentient Being]

relax_dk,

I hope that big move is UP. I noticed WM moving up today. They have been beaten up, I think the expectations of a cut in the fed rate has people buying there. Last I looked they are up over 1.5%.

My stops didn't hit today so I'm positioned for upside. But nervous.

[relax]

i don't think tomorrow will break the trend if they don't cut we will probably go for some sort of double bottom i just as nervous about lehman brothers and the other banks nonetheless i think the market is prepared for that so in order for the market to go lower there needs to be a big bank in big trouble/bankruptcy but in that event i expect ben to come to the rescue just seems there is so much negativity priced in at the moment so if ben delivers .25 tomorrow and inflation data comes in fine, it will be business as usual, in other words up tomorrow's reaction - maybe they sell off if he cuts by .25, but really would not expect the sell off to last core cpi too high on wednesday could definitely cause something bad we'll see - good luck ;-)

[thespookyone]

"I have seen the market going from expecting a rate cut to not expecting it without too much downside" I don't really think you've seen the market not expecting a rate cut, just imho. What we have seen is the market FULLY price in .25, then fully price in .25 with promises of more to come, then vacillate between pricing in .5-or back to .25 with promises of more. I think we will get the .25, but not promises of more-as that would put off corporate and private spending waiting for the other shoes to drop-which would be counter productive. I think .25 without promises of more disappoints the market. We'll find out tomorrow-should be fun.