Friday, October 19, 2007

Market Agnosticism

Though I wish I could say with some credibility that I'm a market agnostic, I probably have more ursine tendencies than bovine tendencies. Or perhaps I'm just canine, barking madly because the market rarely does what I think it will do or chasing my tail (or doing both!). A market agnostic would certainly be represented by a feline: sleeping soundly, our fastidiously cleaning its face while the market spins into a vortex.

George Dagnino, an opinion that I not only pay for but admire and respect believes that the market will go higher because of Fed intervention. You can check out his current blog (click on the menu to the right). Others are calling for the market to correct because of the tumult in interest rates, credit derivatives falling dollar, high oil. You can add your own fears to this list.

I'm still not smart enough to know when to listen to my fears or when to quell them. I'm of the mind that Fed stimulation will not provide accretive money, but rather will backfill the stuff that was flushed down the toilet. I certainly do not know, I'm but a lay person. But I didn't believe that bonds would be so attractive last year. They weren't, but luminaries said they would be. When smart folks take opposite poles and folks like me are in the middle it is uncomfortable. It's always your money, your risk and your decision.







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7 comments:

Anonymous said...

Three times I tried to buy the dip this morning and three times I got burned and stopped out. Why I was going counter chart trend I have no bleeping idea. That'll teach me.

Slightly Trimmer Cat

Anonymous said...

The healing underneath the market I have been pointing to has stopped and is ever so slightly starting to worsen.Need to keep an eye on that, the weak Russell 2000, the trannies and the weakening utilities. All those divergences are not saying BULL RUN to me.

Cat

Anonymous said...

Gold:XAU

http://stockcharts.com/h-sc/ui?s=$GOLD:$XAU&p=W&b=5&g=0&id=p24517677134

Ratio has backed off. If stochastics (bottom) reach about 50 then a better risk reward ratio will be presenting itself for the reload.

TGIF Cat

Anonymous said...

Cat,
Your foresight is most impressive.

Anonymous said...

I trust you are being sarcastic anon as I assure you that I was Friday's Idiot Trader of the Week. All week I have been short IWM and Friday of all days I decide to get cute and do some dip buying. Sort of scalping back and forth on the ride. That was painful as each ledge on the chart I bought and each time I did they dropped it straight through the floor to Perdition. That cost my position big time as the first two thirds of the ride was a fat zero. What total arroganceon my part.

Now there is likely a huge snapper being set up IF we are market normal here. Are we? Monday's open will be interesting for sure.

Chastened Cat

Leisa♠ said...

Cat of nine faces: Buying the dip? Man did you hit the catnip early? John Murphy (as well as YOU) has been pointing to the divergences. There was no way I was going to go long on Friday.

Anonymous said...

L-

I had been doing it most of the week with great success (read:LUCK). Mr. Market decided to teach me a lesson. Good stops prevented an expensive one. I turned a HUGE day into a mediocre one. I went long at the shelf around minus 45 and got burned, at minus 95 and got smoked and was out of all attempts to game it long at minus 140.

I broke one of my rules on Friday. Never re-enter a trade pattern after you've hesitated and missed the day before. Thursday I failed to pull the trigger twice on profitable scalps like I had been doing all week. I have found that that means my luck is about to turn. TRUE AGAIN.

I see a bit more deterioration underneath on Friday's action. However, price is a little more in line with breadth now so that's a good thing! LOL

Humble Cat