Hi bb,
I trained as a psychologist, so sentiment factors are where it's at for me. I've noticed the same things you have, however there still seems to be (on various popular threads on SI)a "buy the dip" mentality, with the idea that we're going to ride right back up to our former highs on the Naz in the next few months. I'd love to get my hands on some data showing recent levels of margin usage for the retail investor.
I'm expecting a short covering rally and gentle lift upward into options expiry by Friday, but think that, long term, things aren't looking very positive. The Dow is technically poised for a fall and more election heebie-jeebies or any possible geopolitical argravations could send is reeling.
I've looked at the NDX chart you've posted and admittedly I'm no great technical analyst, but I'd think that, in order to get back to the Oct 99 lows, the RSI would have to pierce
the lower band, something it hasn't done since 1992, according to your chart. I do agree that we've got more downside to go, though, particularly if the Dow falls significantly. |
