a bear trap is a fool's rally, a rally with no legs
a bear trap lures in naive buyers with a brief rally that loses steam rapidly and resumes the downward slide
the fool's rally is often earmarked by short covering and very shorterm traders
personally, I bought into several bear traps in 1994
did so with EMC, Compaq, Micron
I waited for a rally to begin, then I bought
that is precisely how I learned some Technical Analysis
now I realize more acutely that experience enables one to see more clearly his/her own mistakes that are repeated over time
in late March, NAZ fell from 5000 on the failed retest
two weeks ago, NAZ gave us a scare on intraday 3650
then NAZ rose from 4000 to 4500 in first week of April
THAT WAS THE FOOL'S RALLY, THE BEAR TRAP, PAR EXCELLENCE, CLASSIC CASE
it lured money in, only to divebomb down hard & furious
the trap is made and laid, a rest before resuming downward
MMike sounds like once again a contrary indicator
just like last August, just like early October
smart guy, respectable guy, but consistently wrong at turns
the economy is strong (except housing now), interest rates are benign, USdollar is strong (but not too strong), employment is robust (workers even scarce), no other continent is in recession (Europe is clinging to its socialism though), and the technology revolution continues (but bigiron computers are weaker), and the internet continues to explode in growth (on all fronts)
wrong again, sorry MMike
we will see, sincerely
/ Jim Willie |
