Discussion in 'Trading' started by crgarcia, Feb 25, 2008.
What you think?
don't think we go sideways - if we get reports of negative gdp this quarter we go lower - if not then we go sideways till growth speeds up
this downtrend isn't over until we get a circuit breaker day. they didn't remove the uptick rule for nothing. think about that, why would they remove a safety precaution that has been in effect for multiple decades now??
According to Investors Business Daily , Ken Shreve the commentator, we had NASDAQ flashinf a " follow through day" few days ago when it went up 1.8% on heavy volume. Since than there has been some selling binges, and it was questioned if that was a legitimate follow through day or not. A follow through day is a must for a genuine bull market.
Since than we have formed a symmetrical triangle on SPX, NDX and DJIA. That did resolve in a move above the upper tendline today. It looks like we are in a uptrend, but walk with caution.
SPX has 50 day and 200 day moving averages and November lows as resistances above.
Technically we are in a bullish mode.
Shorting is extremely dangerous at this point as you may have seen how many shorts got burned on Friday Feb 22nd 2008
We donot depend on " What if " scenarios. IF we start what iffing we might just get admitted to a mental asylum and be done with that. Never start speculating what if and what if. ....
There is no concrete proof of a recession yet and if there is one it will be mild and Feds will insure a rapid revival. They have said that many many times. Recessions usually donot happen when incumbents are trying to get elected, it just simply does not happens in American politics.
Because not having the uptick rule encourages index arbitrage which in turn provides liquidity to fund managers and additional volume to the exchange.
I'd guesstimated that we would see a sharp break downwards by the end of Feb, and I see what looks like a bearish pennant on the SPX weekly chart... a lot could depend on Tuesday, if 1368 support doesn't hold we could see a big drop.
As I speak ES looks to have made an LH and is hovering below 1370...
The Fed won't be able to save us this time. The problems are too serious, everyone has too much debt and there are too many bad assets in the system. Look at today: S&Ps rating affirmation was a joke. MBIA for example has at least $40 billion in worthless securities (which are optimistically worth $10-$20 billion) but only about $5 billion in cash. The banks' "rescue plan" will make another $3 billion available. It's therefore complete nonsense that MBIA-insured securities would have an AAA rating. Markets could head lower very soon unless something more comes of all this, though a proper bailout could keep things going sideways for a long time.
sideways is way too optimistist given that the bull market was fueled by money supply growth.
the banking sector isn't out of the water yet. could take another 6 months to a year before we see visibility on how this will play out
There hasn't been a Capitulation yet.
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