Even though I am as bearish as you are, I think there is a real possibility for the the DOW to hit 11K and for the small caps to create a beautiful double top formation before we go to DOW 7K. Perfect October crash setting.. I am already mostly short anyways.. IMVHumbleO.
We can add Belkin to the bearish camp. He's calling for a slow top being carved out now with drip/drop into Sept with VIX/VXN rising hand in hand. Rallies should be sold (he's rooting for a rise just a tad above prev high for clients to sell into). Keep in mind this is for inst. clients who move b/millions and not actionable on a short term time horizon. Oh and Woody Dorsey is also bearish (Mkt Semiotics). Just grist for the mill.
It is a very dangerous science to try and predict the market. Better to trade what the market tells you. I will agree with anyone that the set up for a major turn is forming. It doesn't take any indicator to tell me this, however, I will let the price confirm my theory. Just look at debt, interest rates, and the good old housing market. Does the housing market remind you of any time recently. My wife just told me there is a sitcom coming this fall on a major network revolving around real estate. Question is...when and how to get short to me. That is the challenge. I am feeling a bit of coiled tension in the market these days. It's almost comical when you watch one of the indexes try to reach a little higher.
I would also like to say that I am a bit fascinated with Mark Cook. Does anyone know more about his method. I have tried to read as much as I can thru the post you guys have made. He seems to be a counter trend trader which is surprising to me. He has certainly exploited the S&P's it seems. I wish I could learn more about how he trades.
I agree with VT, one cannot predict the market and expect to survive very long. Better to trade what is. And... even trading what is carries risk - and wherever RISK is, it means there is risk of loss, right? trading is great... but, sex is better... no, WAIT.... *thinking* ... yeah, sex is... wait... yeah, sex is better. FX
=========== Vision trader; Jack Schwager has an excellant interview in top trader book. Another interesting thing besides the october crash; one of the few major market turns he made a probability statement on . Mark Cook buys options,stopped selling options after the million dollar or so margin call , being short calls ,wrong side of oil stock tender offer. Inresting also is even when october does a polar bear; tek stocks tend to bounce/uptrend fiercly back up in October, even in bear markets or bull markets. Wisdom is profitable to direct
Mark Cook trades about 8 or 9 specific and mechanical setups in the bonds and the SP. VERY low reward/risk. One of his setups has a 3 pt profit target to an 8 pt (yes, 8) stop. The cum cook ind is a swing/position indicator. To trade it you need deep pockets, a stomach of iron. I watched him trade live, nothing special, but he seems to have no emotional attachement to what he does. I actually left his seminar a half day early because I thought he was a horrible teacher. He didn't really answer the questions of the attendees.
============== Good points including non guru worship; Rich Dennis /Schwager said do your own research. And also its still a bull market, especially in homebuilders & oil-gas sector; however worst 2 or 3 months, last 30 years for Nasdaqqq & DOW=AUG & OCT [Jeff-Yale Hirsch Almanac,2001] And in Marks helpful time period/crash example starting with DEC99; homebuillders & oil-gas stocks did VERY well on long side, long time.
VisionTraderâyes, Cook is mainly a fade trader in his day trading timeframe, and also does position trades based on his other indicators like the Cook Cumulative Tick. I learned a lot about his trading by listening to tapes of lectures heâs given over the yearsâsome of which you can get at ino.com or places like Traderâs Press or Traderâs Library. Yes Cookâs setups do have high risk reward ratioâbut they are set-ups that in his experience have a very high percentage of winning trades. Important to note that trading set-ups are only a part of what he teaches. He spends a lot of time on the other aspects of what it takes to be a successful trader. The fact that he has lasted 28+ years trading speaks for itself. AND that he actually makes his living trading not running a chat room/web site/retail seminars and general snake oil selling. I actually went to his seminar twice because I thought he was such a good teacher, and has more knowledge than can be imparted in one session. Also, he loves to talk to students and makes himself pretty available. So believe me, if you want to learn more about how he trades, heâd be more than happy to teach you.