Sorry, I was a little groggy from last nights wine to respond this morning.
But, I do think we saw a fair amount of capitulation everyone is concentrated on lately.
I made a post here this morning that things were just flat lining and that wasn't good. Then, around late morning, we started to see the real selling begin. I usually have about three or four L2 screens going at once, and what I was seeing were these waves of orders coming in for big volume. We're talking 4300, 6700, 12000, 6000, 3200...so on.
At first the bids were keeping up on them, than they just became overwhelming, and the bis sides were drying up. Than this afternoon9with the exception of that half hour little short covering) I started seeing blocks of stocks going off below the bid. I know, I usually see that stuff on regular days too, but this was exrea ordinarty. I was watching lots as smallas 3000 and as much as 50000 going off over a point below ask, while there were perhaps several thousand between their price and best bid.
It was my impression that people were selling at close to any price just to get the hell out of the stock.
Think of it, you have 50000 shares of something, andyou are 20 or more points under water, what is the cost to just say "I want out right now". You're down a maybe a million, what the heck is another 50K or so?
Now that the dust from today is clearing, I'm looking at a boat load of stocks that while may still look expensive in a couple months, from last week or even yesterday, they are really cheap.
I start rambling about here....
Tomorrow should be up, and today may have, it did, IMO siginal a S/T bottom. I'm not expecting a big day tomorrow, but I am learning towards at least a three day rally in the comp(3 days though is now a psychological block). Also, we can't nearly rule out margin selling and tax loss sales, I still think those will provide some resistance- that's what 5 or 6 days still(tax loss)? there are always going to be sellers right into it, though I think a good portion was cleaned out today.
I don't look to the funds to be buying just yet, that would start right in Jan. Regardless, I don't think I want to be long the market much past feb. Right now, I will go along with the assumption that a rate cut is coming in Jan. Some are even calling for an emergency meeting to cut rates before then. That still doesn't hold much water in my pail After the rate cut, we'll have a giddy rally, but soon, that will give way to more economic uncertinities. If numbers come out and econ is going down, rate cuts won't help at that point.
P.S> If you have read this far, you'll notice I didn't use the spell check<G> |
