42 replies to this topic

[OEXCHAOS]

Since i never got any response to my question on the timeframe, i will go ahead and assume that no one here has any conviction as to how long the rally would last or how sustainable a bottom we have put in. Bunch of nervous momo players ready to exit on a dime ?? Maybe. We should know the answers in a day or two.

I'm talking intermediate term low, or the possibility of such.

MAYBE the low for the entire correction with new highs coming...

BUT, I'm just guessing here. The bottom line is we have to confirm a turn to be IT bullish and we have to exit the Bear market status to look for new highs.

I'm just saying that we need to be open. I think that many aren't.

Mark

[NAV]

Since i never got any response to my question on the timeframe, i will go ahead and assume that no one here has any conviction as to how long the rally would last or how sustainable a bottom we have put in. Bunch of nervous momo players ready to exit on a dime ?? Maybe. We should know the answers in a day or two.

I'm talking intermediate term low, or the possibility of such.

MAYBE the low for the entire correction with new highs coming...

BUT, I'm just guessing here. The bottom line is we have to confirm a turn to be IT bullish and we have to exit the Bear market status to look for new highs.

I'm just saying that we need to be open. I think that many aren't.

Mark

In other words you are betting on a "V" bottom. When the last time an IT bottom was coincident with the McLellan Vol Osc bottom ?

This market desperately needs a retest and one is coming in the next few days, IMO. If the OPEX shenanigans press the market a bit higher, we may fill that gap at 1378 and crap out. If not, we may have seen the top this morning. Anyway, i am probing short, which i posted on my blog.

Edited by NAV, 12 February 2008 - 12:44 PM.

[OEXCHAOS]

Nav, the 5' trend is down. You should probably looking for shorts regardless. I probably should be too, but I want some lunch.

[sherholmes]

100% of bottoms occur when bottoming appears to be the least likely scenario, OR when the majority is unwilling to position long. Perhaps, but is it also true that every time that either (1) bottoming appears to be the least likely scenario or (2) the majority is unwilling to position long, the bottom is in? It seems to me that in a bear market, you will have either (1) or (2) for a long time, before you hit the actual bottom.

[IndexTrader]

100% of bottoms occur when bottoming appears to be the least likely scenario, OR when the majority is unwilling to position long.

Perhaps, but is it also true that every time that either (1) bottoming appears to be the least likely scenario or (2) the majority is unwilling to position long, the bottom is in? It seems to me that in a bear market, you will have either (1) or (2) for a long time, before you hit the actual bottom.

Exactly. You hit the nail on the head. Every bottom no one is willing to buy. But there are many other times when people are unwilling to buy. So while at a bottom certainly no one will be willing to buy, there is no way to extrapolate the unwillingness to buy into a general statement about whether we're at a bottom or not.

IT

[humble1]

i'm not sure the march 2003 low, or near time to it, really fits into this pattern.

[Kimston]

One thing that could suck in more bag holders would be if CNBC or Bloomberg interviewed some highly respected and successful stock wizard that tells everyone stocks are fairly valued and the worst is behind us. This is all hypothetical of course, but if the smartest market man in the world says buy, that could start a rally that lasts a couple days/weeks and get a lot on the wrong side. Buying rallies in a bear market will likely prove as painful as shorting sell-offs in a bull market.

Kimston

If he did at this point, he wouldn't be.

Precisely. It's all about perception and historical perspective. Some of the most respected money men and economists in '29 were quoted saying things like "We have entered a permanent plateau of prosperity". The wizard of the day were telling the public they were buying to support the market. Buffet is an analog.

Kimston

[OEXCHAOS]

except, of course, that Buffet's investing philosophy and practice is a product of the crash and depression--Value Investing. Buffet is not a good analog. He's more an example of what more investors ought to be. It's the diametric opposite of presumption of permanent plateaus of prosperity. It's about buying panic and mis-valuations. Another thing about Buffet's public actions: most of the time it's dead meat for quite a while before he cleans up. Mark

[ogm]

Precisely. It's all about perception and historical perspective. Some of the most respected money men and economists in '29 were quoted saying things like "We have entered a permanent plateau of prosperity". The wizard of the day were telling the public they were buying to support the market. Buffet is an analog.

Kimston

Permanent prosperity talk was all the rage in 2000.

Right now just about every talking head predicts a depression as far as eye can see.

[mss]

Another thing about Buffet's public actions: most of the time it's dead meat for quite a while before he cleans up.

Mark

As an example it took more than 10 years to make any money when he went into KO the first time.