jackg1606:

And if you switch hats you can win as a bear and a bull.

Investing is one of the rare occupations where being a turn count gets you beatified rather than lynched. Or, with some luck turned into a Peter buster.

Contrarian investing has gotten many people quite far. It's not exactly a sure thing, trying to figure out how long the delusion or post correction depression are going to last isn't easy, but it tends to be quite profitable.

jackg1606:

koreiko:

I don't know what makes you think that it should go down the hill from here. I still think there is enough steam to make a final push in the market. All the facts you brought up were there at the beginning of this rally in the first place, so what has changed now? Well, the only change I see is in the odds in your favor. VIX looks like it is starting to pick up, but SPX is still above the 1370 line. What is missed from your quotes is the declining oil price which can turn the bulls on tomorrow. Anyway, good luck to everyone.

You are exactly right...nothing has changed.  All of the negatives existed before this rally began.  That is why this rally was nothing more than a dead cat bounce......a bear market rally.......call it whatever you want but you can't call it a new bull market.  The longer term downtrend line has yet to be broken.

I use the $spx (SP500) chart.  Drawing a trendline from the high made in October and connecting it to the high made in December and extended out to today sets right about 1411-1412.

The Dow only contains 30 stocks so it isn't as good of an index indicator as the S&P 500.

koreiko:

I don't know what makes you think that it should go down the hill from here. I still think there is enough steam to make a final push in the market. All the facts you brought up were there at the beginning of this rally in the first place, so what has changed now? Well, the only change I see is in the odds in your favor. VIX looks like it is starting to pick up, but SPX is still above the 1370 line. What is missed from your quotes is the declining oil price which can turn the bulls on tomorrow. Anyway, good luck to everyone.

You were right about a lil more juice being left in the tank.  SP500 is now bumping up close to the downtrend line.  I closed my short positions opened yesterday this morning for a small gain.  I'll wait to see what tomorrows reaction is to the employment numbers before getting back in.  If it breaks down there could be a really impressive trade developing.  If the trendline breaks then I'll daytrade from the long side until reality sets back in.

Here is a great article regarding the latest economic news.....

http://biz.yahoo.com/

jackg1606:

DracMonster:

Did I miss something? Stocks were down today,. but only mildly

 

Go back to sleep.  We will wake you in a couple of years after this bear market is over.

 

RichDad:

uhhh, what chart are you looking at?  The DOW has been making higher highs and higher lows since March 10.  if I zoom out, it still looks like the downtrend is broken.

Also, rallies tend to precede economic recovery, I believe...

Zoom out for a bit longer period like a decade so that your chart includes 1999, 2000, and 2001. Then look at the chart of either index with 360 day moving average and compare. The higher highs and higher lows that you are talking about are not even visible on this chart.

Wrong, the Dow isn't any sort of indicator. It's just not an average of anything other than those 30 companies. It's weighted by share price rather than market cap, so while splitting shares has no impact on the market cap, it suddenly cuts a company's representation in the average in half.

Likewise if a stock does a reverse split for some reason, now all of a sudden it has a much larger baring on the average. Trying to figure out what the stock market in general is going to do based upon the DJIA is a bit like trying to figure out what's so great about Citizen Kane whilst watching in a victorian hand mirror attached to the seat back. Sure at some points you'll get the picture, but 90% of the time it's going to be distorted to the point of absurdity.

Those CNBC goofs are spinning this thing like crazy.  LOL  They are always 100% full of bull.....pun intended. 

"Investors are looking through all the bad news to the recovery and in the second half there will be an economic boom"....if I had a dollar every time I heard that line of crap I'd be retired by now.  Jobs losses are growing......more people receiving unemployment checks now than at any other point in time since the last recession and the numbers are growing.  Fed can't cut rates more or inflation will kill us.  A stronger dollar will kill GDP and corporate earnings.  They have us stuck between a rock and a hard place while CNBC is cheering that a recovery is on the way.  Meanwhile, foreclosures continue to rise meaning more write offs to come and the commercial real estate bubble has yet to crash.

I forgot to mention, "all this bad news is already priced into the market".....LOL...who are they kidding?  Sadly, most of America!

koreiko:

Look how the news will gradually change from cheering bad to worrysome bad and then to extremely bad during the weekend and throughout the next week. My portfolio shrunk by 4K today which indicates to me that we are inches away from the peak. I have about 60% short on energy and 40% long on basic materials. Both moved in opposite direction. What a rough day.

DXD, QID and SDS are great double inverse ETF's to own when this market starts to slide down the other side of this mountain.

I never like to listen to anyone in the media (CNBC, et. al), because to some of them, the sky is always falling.  And to others, the streets are always paved with gold.  And to a select few clowns out there, the sky is falling on them while they are walking down streets paved with gold.

Is America in a recession?  Some rating systems would say yes, others would say no.  If the market is any indicator, you can tell no one has any idea what they are talking about.  The prices flucuate so much day to day that you can tell all the people who are talking loud about the economy going one way or the other really have no clue what is going on.

Personally, I am going to use the current market as an exercise in patience.  I know patience is not exactly a good thing to most investors, but to me, stock picking is not simply legalized gambling.  I just look to the gospel according to Warren Buffett.  Buy at a price you deem low enough, investing in a company you feel has strong market share and a solid balance sheet, and wait until you feel the price is high enough.  Then you sell, and not a second sooner.  I may be some scrub, nobody investor, but I will take down home Omaha advice from Mr. Buffett a lot sooner than I will listen to any of those talking heads on TV.  Besides, sit on a long enough time line and the stock market ALWAYS goes up.