As you can see from the charts, I unleashed my proprietary algorithms and was able to trigger an orgy of buying! Some our billing today as a successful retest of the lows---the fullness of time. And perhaps the fullness of the moon has contributed to such mischief!But the market will always surprise the most number of people! There was a treasury auction and that was not terribly successful. Perhaps the bubble in bonds is conflating a bit, and money is moving into a a very oversold market.
At any rate, these moves appear to trigger stop losses (for both the longs and the shorts), and the result is: mayhem.
I did a little "Custer" trade. WCG, a stock that I've been watching, had a major meltdown. I almost bought it at $19 or so. Well, I thought that it was a real bargain an 11.12, and when it went down to six and change I thought....well, ....best left unsaid! But it recovered, and my position was small. I'm still holding.
Well the bear market behavior continues:
ReplyDeleteSharp fast rallies out of nowhere -
Rallies on Monday
Selling on Tues&Wed
Short covering Thurs aft or Fri
And a lot of B.S moves up when some Fedhead is speaking.
Lots of 'hope'
Best to trade what is happening - not what one 'hopes'
Unfortunately markets don't move up on hope.
For the bulls, no follow through - VIX did not make a new low today either.
Another papa bear (jugglingdynamite.com) buying in
So one by one the dips are bought.
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On the plus side: it is the middle of the month - and liquidation could slow as the Hedge Funds already know how much cash they need for redemptions.
Also options week is coming..
Do we have the usual play again - ie: UP?
(Another bear market manipulative phenomenon is where we only have contrived rallies at either the end of month or on options week - rather than 'Real' buying.)
Also to the bull case is that the USD is looking a little wobbly (though it did not help today)
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Based on cycles - I see the DOW going to 5000 by 2010
There should be a good rally between Dec 15th and the summer of next year.
Unfortunately so far all the trading cycles have been able to muster up are consolidations rather than rallies - followed by a move lower.
However I am more confident now - given the growing pessimism and the fact that so much of what is happening now is getting out into the open.
The Fed has injected 2-3 trillion into the market and we are down 40-50%. Without the injection we would have probably been down 70-85% (ie: akin to 1929)...
Given this it seems probable (and probably profitable) to play the coming cycle low Dec 15th - for a rally into next summer.
(and it will be a rally that no one will believe in - which is the kind of stuff rallies are made of)
good weekend all
nice
I suspect that you are correct. I was listening to Tim Wood a couple of weekends ago, and he was expecting a retracement (50-75%) of the Dow from 1974 - 2007.
ReplyDeleteMessy all the way around--And the average investor gets screwed.