The Red Pill: The Truth As To Why The Markets Will Rally

BSAM · Apr 6, 2007

Quote from formikatrading:

Bylo -- it seems you just need to post this stuff to calm yourself.
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He sure does give a lot of advice.

ByLoSellHi · Apr 6, 2007

Quote from BSAM:

He sure does give a lot of advice.
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I don't advise anyone. I'm not that bright or that presumptuous.

But I often post my opinion or that of others.

And it's free!

murray t turtle · Apr 6, 2007

Rising rates tend to help produce a bear market;
it never has been clear the tipping point on those however.

However war tends to be bullish;
ever heard ''buy when there is blood in the streeets''We know the shorts buy then [eventually]also.

BuySell Hi;
Hi.
Interesting ''high''SPY chart with the 50 week moving average, it bounced off of is close to 200 dma.

In other words 50 weeks is pretty close to 200 dma

Dackster · Apr 7, 2007

Quote from nonam:

Jerry Olsen says....
Look I've been on this earth for 65 years gonna be 66 on the 23rd of April. I've been in the markets for 30 years but over the last 10 I have seen and heard and done a lot of things. One thing I did learn was to look for "Tells" in the market signaling to me something underlying this market has a different feel to it then before. Ok let's kick the tires for a bit. We have crude oil heading for $70.00 very soon, Iran is at the forefront again creating angst in the whole world, Ben B clarified the Fed is hawkish on inflation and their bias is toward that end he said so in actual speaking terms last week. The housing debacle is getting worse so it seems, at least that's the perception out there, I think it's bottoming as we speak based on my own situation. And yes there are a myriad of "other" market noise out there weighting heavily on the streets thinking right now.

So I ask everyone of you right now, why are we not crashing and burning by 1000-2000 points on the DJIA and 200-400 points on the NAZ etc etc etc? Why is it NOT happening? I mean folks we are all traders, we hear and read all this constant "negative" news stream every single day ad nausea, it just never stops right? So what the heck is going on huh? Well for one thing the recent quick sell off post Greenspans blurb, or maybe a better word for it would be belch, about a recession later this year making the markets correct world wide had nothing to do with the internals we were simply overbought for too long period.. The economy looks okay right now moving along at a moderate 2.5% GDP with very low interest rates so I do not see the R word as practical for the country. Jobs are still being created, personal spending and income we're up double as of last weeks reports, that does not signal recession to me. So what we have here is "The Tenacious Market" that refuses to quit. Being bullish for me is easy. I was born under that sign, and I live that way all my life good or bad times. The Bull Dog in me and this market makes me even more crazy than I usually am because the bearishness is rampant out there right now, what with investors sentiment at levels where good rallies start from, and CBOE P/C levels using the 21 day moving average is almost 1.17 at historically high levels of pessimism, and really why not?

Everything looks like it's going to explode out there, War with Iran, Oil prices to 100 bucks barrel, rising rates again, heck you name it's lurking out there. But damn if the contrarian in me is saying we are going higher right now and probably starting this week. Look they could have sold off this market sending it reeling into the abyss, but for some reason it refuses to go away right here and now. I'll show you all the charts, I'll explain what I'm seeing on all the index charts, but more importantly it's the bullish percent charts on P&F, the supply and demand, that have me thinking we're going higher fast. There are a vast amount of shorts in the market right now that can and will light this candle like we've never seen before. On top of all this action is the real McCoy part of the year and that's beginning of the quarter mark up and buying time, plus we are heading into what I think is an underestimated earnings season that going to have surprise after surprise as we embark on those reports and with upside guidance. I love this market right now, and will not change one hair on my head until and unless they wipe the smile off my face.

The TELLS in this market are as follows. The NYSE Bullish percent had a recent correction down from 74% in Feb to 62% at the bottom of this move and now folks this indicator, this big boy on the block is just a mere .64% away form a reversal back up. You remember me writing about the fact that the BP"s were not going down any more they were showing traction even though we made price lows on all the charts of the indexes? We'll now they're starting to move higher here with, and this will really get you to sit up and notice, the NDX BP leading the way? Once the laggard of all index BP's it's now the leader. IN fact the SPX BP is only 1.58% away from a reversal back up too. So if I'm right we are in for a surprise rally like you have never seen before. So hang on to your hats everyone!
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Wow!

Jerry 'The Ego' Olsen!

Wonder how Jezza will explain himself if there is not another aggressive rally?

Don't bother Jezza...i've heard and seen it all before.

Be careful, and good trading all.

Dr.Greenback · Apr 7, 2007

And with all of these valid concerns on the economy, the market continues to climb a wall of worry..hmm. Makes you wonder

Hydroblunt · Apr 7, 2007

Quote from murray t turtle:

Rising rates tend to help produce a bear market;

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Why?

billdick · Apr 7, 2007

Jerry olsen, quoted by some here, expresses wonder at market strength inspite of all the negative news. It does not seem strange to me, as I try to think of the market's real value, not the dollar evaluation of it. (Sure it will go higher in dollars as the dollars lose value.) - call that a "bull market" if you like, but I do not.

I expect to see dollar dropping at a faster rate later this year. This is why I expect the Dow to be approaching 1500 in early 2008, but sliding down in real value. (I am a stock bull, dollar bear, and neutral on the Euro.)

I like the Brazilian Real - Has gone from 4 to the dollar to 2 to the dollar in about 5 years, despite the central bank tripling the reserves held in dollars. (Locally there is much fear of 'de-industralization" as exporters of high value products are hurting as the dollars stream into Brazil from food and commodities sales.)