Dow

[ananda77]

GEAB N°30 is available! Global systemic crisis – New tipping-point in March 2009: 'When the world becomes aware that this crisis is worse than the 1930s crisis'
- Public announcement GEAB N°30 (December 16, 2008) -
http://www.leap2020.eu/GEAB-N-30-is-...his_a2567.html

...after short cover at 816 for SPX 500, first 'SPX 500 shorting target' hit at 851 on bounce;
...next SPX 500 shorting target at ~880, if oversold rally continues tonight;

Kind Regards

[ananda77]

Bernanke's Design Flaw and Why Depression Has Become INEVITABLE...

THE GREAT EXPERIMENT
Quarterly Review and Outlook - Fourth Quarter 2008
http://www.hoisingtonmgt.com/pdf/HIM2008Q4NP.pdf

Trading:

Option Expiration:

-funds profit from increased 'Premiums' on options due to high market volatility and
-let options expire worthless by selling underlying securities into market on expiration day
-consequently, SPX 500 stuck in 850 range for the session

...in the very short term, it is most likely, that the oversold rally will continue to Dow ~8400 and SP 500 ~880

Trading Strategy remains unchanged...

Kind Regards

[Hoop]

Whats the difference between 7000 and 8000?

A long term reason why 7449 intraday bottom on the 20th Nov is a vital support point.

Actually its a very strong support band rather than a line (7100-7600) The band is well established, tested and retested over the years therefore I assume it would need an extraordinary event (disaster) and probably panic selling to breach it.

The only market phase that this (7100-7500) band breach could occur in (if at all) would be in a secular Bear cycle (super-cycle) phase. It just happens that the DOW has been in a Secular Bear Cycle phase since 2001.

Overall gambling with the odds one would assume it will once again (20th Nov) bounce upwards off this band (retest is possible).

[ananda77]

HOOP:

...fair enough, but one thing one MUST remember when looking at charts:

corrections into opposite directions happen in overbought/oversold territory but, in the same way that a bubble extends to its extreme despite extreme overbought territory,

THE CRASH happens despite EXTREME OVERSOLD TERRITORY

and

ARE WE NOT WITNESS TO EXTRAORDINARY EVENTS NOW???

-and because many people are still not aware of the real seriousness of the situation and still continue to believe in miracles, remains the best indicator that we are still far from a possible market floor...

Kind Regards

Belgarion: could you explain your previous post??? the only sense I can make of it is that the illusion of rising prices will get us out of this mess?????

[AMR]

Colby's encycolpedia of technical indicators states that naive testing of stochastics (overbought/oversold indicator) gives profitable buy signals around 70% of the time. However being a counter-trend indicator you get massive drawdowns (-36% in 1988). The major DOWN move we had in October was one of these times where oversold markets became even more oversold.

Conclusion is that picking bottoms is like picking up pennies in front of a steamroller

[lakedaemonian]

Sounds like me. ... being quick and nibble, and only picking up the gold pennies, is the key to success!

Just make sure they are the ones farthest away from the steamroller.....and that your shoelaces are well tied to avoid tripping.

Unfortunately, the demise of the originator of the pennies/steamroller quote does not represent the best of omens.

[Hoop]

Colby's encycolpedia of technical indicators states that naive testing of stochastics (overbought/oversold indicator) gives profitable buy signals around 70% of the time. However being a counter-trend indicator you get massive drawdowns (-36% in 1988). The major DOWN move we had in October was one of these times where oversold markets became even more oversold.

Conclusion is that picking bottoms is like picking up pennies in front of a steamroller

AMR + Others

Bottom picking is impossible to predict 80% 90% even 100% of the time.

However one can increase their chances of getting it right by looking at past trends and comparing with the now, and by using all the tools available to do so....Remember it ain't an investment crime to use investment tools to try during bearish times...doing your homework pays off.


My Homework, through research in learning investment theory and using TA tools earn't me a small profit and a small increase in Capital gain in 2008.

Being nimble, keep to strict self discipline, not listen to the Herd, not being greedy, quickly dispose of souring stocks, wait patiently for those rare gems to appear, buy at the beginning of sucker rallies and sell before the top and being happy to laboriously pick up the pennies and forget trying for the big bucks was the way to go during the worst year since 1931.

I have shared about 5% of my efforts to shartrader readers...something which I don't have to.


Steam roller? .. ha...no contest

[lakedaemonian]

Demise?

More on Nassim_Taleb ... http://en.wikipedia.org/wiki/Nassim_Taleb

Whoops! My bad......I thought it was one of the rocket scientists at LTCM that came up with the quote...rather than Taleb creating the quote but with LTCM as the target of the quote.

[airedale]

Is the OZ market drifting today without a lead from the Dow.
Two day weekend, then
Martin L King day...Monday
Inauguration Day....Tuesday
Then perhaps the Obamarama Rally on Thursday our time
Cash in your chips on Friday our time

[Dr_Who]

Here comes the 8k test for the Dow.

I think the Dow will go below 8k on the lack of investor confidence. Who knows how low the Dow will go if it breaches the 8k support.