Then and Now

trade what you think, not what you see. charts are very deceiving.

best,

surfer

 

Then where do you see an uptrend? Like I said, we have yet to break through the last reaction highs. Therefore, there's no trend reversal. What you "expect" is not an issue.

--Db

 

well i guess thats what makes a market. The rally was very strong and the nasdaq broke its downtrend line on 3/13/03. The pullback has been on significantly less volume so far.

 

agree. there is more upside latent in the market at this time.

best,

surfer

 

Breaking a DTL defines only a possible change in trend. It doesn't define a trend reversal.

--Db

 

Don't confuse a very oversold relief rally with a big component of short term short covering and contract expiration action (which skewed volume) with a trend reversal.

No way to know at this point whether this turns out to be a real trend reversal or just another strong counter-trend rally like we've seen before, especially with the potential for Iraq to get uglier before it's all over.

 

In 1991 bond yields were at ~8% now ~4% hence P/E ratio near 2x higher 2003 vs 1991

 

If the indices rebound from this pullback and resume their advances, then the bulls will be able to say nyah nyah.

If the indices bounce then resume their declines, then the bears will be able to say nyah nyah.

In other words, whoever guesses right gets to say nyah.

None of this, however, is what matters. What matters to a disciplined approach is having very clear definitions in one's own mind about what constitutes a trend, a change in trend, a trend reversal, strength of trend, support, resistance, a breakout, a confirmation, a failure, etc. And if those definitions work for him, then it doesn't make the slightest difference whether anybody agrees with him or not. If, however, he's never formulated such a set of definitions, then he'll be victimized.

ArchAngel has no bias. He's keeping an open mind, waiting for the market to tell him what to do. I doubt that he'll be shorting rallies and buying declines. And I doubt that hope plays much of a role in his trading decisions.

--Db

 

I do make short term projections of what I think will happen in order to figure out if the potential reward is worth the risk. However I use mechanical exits in case I am wrong.

 

"well i guess thats what makes a market. The rally was very strong and the nasdaq broke its downtrend line on 3/13/03. The pullback has been on significantly less volume so far."




--Db