I entered the market early, a week early. I averaged down today since today is absolutely the reversal we've all been waiting for. Capitulation day and single day explosive reversal. The worst is over Bernanke is on top of the situation. Go Fed Go!!!
Didn't see much capitulation really. A mild amount earlier in the week, but certainly no panic, we didn't even break yesterday's low. It was nothing like the sort of bottom you normally see at bear market lows. Since financials were leading things lower and WFC came out with good results when people were expecting garbage results, we got a very strong rally. It may continue a while, but IMO it's just a bounce off oversold & a bit of fear, sparked by surprise good news. I would say any rally is probably capped at 1300ish, maybe 1325, and that would then be a great short-sell opportunity for the next leg down in this bear market. So yeah, good spot to cover shorts (if you didn't already on the WFC news). Good for a quick trading long perhaps. But if I don't think it's the start of a bull market. Note - the VIX closed around 25. Usually in a real bull run, the VIX stays high for a while since people remain nervous, and a wall of worry is needed for a real big move higher. The collapse in the VIX tells me this rally probably ends within a few days or a couple of weeks at most.
This is not the end of the bear market. We will probably see the market rally for the next days, but that's just because it was way oversold. I believe we will rally to the 61.8% fib retracement (1,350 for the S&P) of the last swing high on may 19th.
"Bull RUN" you mean bear market rally, if the market has another rally tomorrow take all the gains you can grab because the market is not done dropping.
"you mean bear market rally" So true and one that won't last but 4 - 6 weeks in my opinion....assuming this is it. T http://actionpointsta.blogspot.com/
There are plenty of reasons to see this market have a sustained strong rally over the next week or two including the imminent drop in the oil price into the 120's and the fact the market is still over sold I would be careful being short here but it is up to you. The bear mightnt be over but he may pull his head in for a bit.
I agree! I hope for a two-three week run, but that's not what I'm seeing right now. I'm not longer DCA'ing down anymore as of last quarter LOL! I'm buying more puts when we rally, and taking some money off the table 'if' we do rally for the next 2-3 weeks. This mess isn't over by a longshot, and I wonder if the next bottom is going to stay "a bottom and flat" for some time unless Crude heads back down to $70-$80.:eek: I don't see crude doing that. Yes, this market is heavily over-sold. Long term buyers who have a time horizon of at least 3-5 years should be happy... In 3-5 years they'll be very happy with the returns they get if they'll buy over-sold equities now, and keep their emotions in check during "the flight."