Jan 2010: down 2nd week of the month (end of bull leg) Apr 2010: down 3rd week (end of bull leg) Jul 2010: only down in Aug (but hard to compare since not a bull leg) Oct 2010: only down in Nov (bull leg did not end, just a correction) Jan 2011: 4th week still UP (but the week is not over yet) conclusion: we should correct really soon but it is taking longer than Jan&Apr 2010
the new top today was 1301 i think was a "super final grand poobah" top. should hold for about maybe 3 days?
I would really hope so, but there are some elements that are giving me the chills. For example the put/call volume ratio has rapidly moved into utterly bullish territory (as in lots of put buying going on the past few days). It really seems like the market is still a closet bear which is being forced out... :/ It's absolutely weird that the options market is getting into pessimistic (thus bullish for the directional trader) territory while prices are going up. This typically only happens after a rally just got started and is approaching resistance and is a very good sign that prices will break resistance and sustain a rally. Thisalso happened in the first half of September and prices didn't give more than a few points ground at the previous top resistance. It's very very weird and it seems like the market is expecting a correction, thus the (technical) correction is likely already priced in thus it probably won't actually happen. Basically the way I read the signals from the options market here is that investors are looking to hedge their downside risk en masse but have no intention of actually selling their stuff... There simply are no sellers in this market at this point. There would need to be a huge fundamental negative surprise catalyst in order for this market to correct down now. Not saying it's impossible, but some negative macros are not going to have an impact for the near term. The market believes that the FED is basically keeping the markets up and will continue to do so (this is incorrect by the way and it wasn't the FED's intention to increase stock prices until it actually happened to turn out that way and they just made up that it was their idea all along. Their idea was to supress interest levels, at which they miserably failed. Without QE/intention to QE the 10 year bond yield would probably sit at 1.5-2%) My top call (for 1300) rescinded for the time being. Any correction will have to be deeply fundamental in cause and there will likely be no technical softening. Also remember that you can't predict unexpected news so any downside rewards will be due to luck only unless you can predict what exactly the downside surprise. Edit: I will also add that if there is a negative catalyst and you are on time, sell immediately and don't hold your breath for a recovery. The market could move down very sharply because after a rally such as this a lot of traders are going to be overleveraged in the market and margin issues are going to play a role on a fast ride down like in April.
Tsing you have made the most posts on this thread. You've used alot of wasted energy here. Cool down time.
The top was put in today, Fri. January 28, sell everything you have, short the market at max leverage, thank me later.