Well guys I was wrong by about 1 hr.. I thought we would bottom at 11 and we didn't bottom till around 12. The 2870 number was right on though. Don't let the media and those ANAL-ists scare you. 2870 was an important number. I watched Costello on CNBC today reporting that the 2850 number was a support but didn't know why. In fact he mentioned it several times but could not provide a reason for the support there. We talked about that last night. There was a 95 point gap from last Rocktober from 2875 to 2970.. Once 2970 was broken, 2875 was the next logical support. We overshot the runway by about 20 points.. Not too bad considering.
Once the buyers stepped up, we got large runs and even went green as the MM's took the opportunity to squeeze a few shorts out.. But as Kevin noted, no one wanted to hold stock overnight again and we ended the day right at the bottom of the old NAS chart we started a year and a month ago.. Coincidence??? I'm not sure.. All I know is this, last year in October... it all started right here.
That being said, I hope you waited to buy once we reached 2870 or so.. If not, Dont sweat it. I expect we trade in a little range for a few weeks and re-test the 2870 low right before christmas. After the first of the year, we might see the market perk up a little but I dare not speculate that far in advance. We have some traders out there with large gains that they waited till the first of the year to book. Now they have a capital gains nightmare. Luckily for them, they also have the "Mutual fund" of bad trades that they were sure would come back. Well guess what. Those dusty old losers in the portfolio will act as ballast for the ship as they sell the losers before the end of the year to offset some of those gains.
Anyway, I have no idea what to expect tomorrow but as always, If and when you do buy, Wait for dips.. Set stops.. and don't get too greedy. Today was encouraging but we are not out of the woods yet.
Marshall |
