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Strategies & Market Trends : John Pitera's Market Laboratory
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To: John Pitera who wrote (990)4/14/2000 6:52:00 AM
From: robert b furman  Read Replies (1) of 33421
 
Hi John ,

It's an old saying of mine,but it really is true.Any test worth it's salt will not just hit a 200 day ma- but drop below(intraday) just to kick in the adrenalin sales those of the capitulation kind.

I think these quick and rare departures below the bastions of support like the 200 day ma occur when traders sell "at the market" and the only bidders out there are "lowballers" who for lack of a better world are "stealing" the stocks at prices that can scalp a nice couple of points in as little as a day.

It sort of reminds me of the used car business. The profit you make, is made in the correct purchase of the car - or stock in this case.

As a side note, I think market makers like to ride the coattails of these lowballs and fill their inventory as well.It's that "If you want me to provide liquidity with my money - here's the price I've got for you".

JMHO

This becomes a bigger factor not only as margin calls occur but also sales forced to prevent the margin call from occurring.I think this is a much bigger factor not often talked about.

Bob

P.S. I think we 're getting close.The exact moment will be marked by a vix spike to the 60's and the put/call ratio will pop over 1.0..I can get vix on quote.com intraday but I'm not aware of the put/call ratio intraday.
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