My God!
Does this mean that I know on occasion what I am talking about???
Let's hope no one finds out.
eek.
My current prediction:
I'm worried about this rally because the indicators are still declining, including the NYSE BP (but still no reversal down). I agree with Mr. BSL that the bullish sentiment is worrisome and after today's rally, it will continue to be so.
What do I think will happen...
July the Dow makes it back to old highs but the OPTI doesn't reverse back up. The short term indicators may but not the OPTI. The NYSE BP stays in X's by the skin of it's Sans X.
Greenie raises the interest rates.
August/September the short term reverse down and the NYSE BP starts to lose ground again this time reversing.
October things are miserable.
November the New Dawn for a smidge.
Oh, who knows really... I think the indicators give us enough guidance. One has to know with the indicators still moving lower and the NYSE BP only 1.5% from reversing down, it is better to be cautious. Yes, there will be rallies and for day traders this will be great but perhaps one should remember their plan.
For instance:
If two days ago you were praying for a rally so you could gain some of the money back that you had lost and swore to yourself you would sell instead of hanging on... BUT today you are saying to yourself "Well, gosh gee wiz, this could be it, this could be the big time, if I hold the stock might go up 100pts tomorrow... I better hold and see, in fact buy more.." You have a problem. You didn't stick to your plan. Only two things can happen. One is the stock does rise 100pts and you congratulate yourself on being a genius and the other unfortunately is that the stock dumps 100 and you find yourself stuck hoping for another rally that you swear you will sell as soon as you get your money back...
There are times that we lose in the market. Everyone does and it sucks. Without a doubt it is the worst. I've seen the stories around SI; Selling houses, borrowing money or hawking kidneys for Pete's sake - for what? Making money is making money. No reason to be upset you didn't get into the big run. Always remember how you felt when the stocks were down, really down and perhaps the feeling of being desperate. It is far better to have a plan and stick to it so to avoid such uneasiness. Far better to retrieve some profits than lose money. There is always another train leaving the station.
So, while today was fab, stick to your plan. If you meant to get out because you gained back your money, get out - set stops or trail the position with stops. Don't jump into a stock that is up and you think will go up more without analyzing it to the nth degree first. With the indicators so negative you have to be very critical of the positions you take.
It isn't over yet. Greenie hasn't spoken, the NYSE BP can still reverse, and pants that hang down to the knees are still in fashion.
Take care people. Check your charts every night. The sells and buy signals today even at so impressive of a rally were about equal - no effect on the indicators. Most of the movement today did nothing to reverse sell signals. AOL is an excellent example of it.
Jan I am |
