FBCE. . .old habit calling it an OTC. Sorry. Greenlaw, as for tomorrow. . . .
Greenlaw, Today's selloff did not make a very compelling case for today being the 3rd day of an S-4DML. Then again, it is typical that the 2nd or 3rd day of a 4DML will reverse direction. . . so it is still quite possible that we are in the midst of an S-4DML. . . .which again would imply late day strength tomorrow.
Today's market was literally squashed by banking fears, started by BAC.
But the REAL question I believe you are asking is this. . "is the economy reacting to the slowdown, and if so, how low can we go?" I believe that the economic slowdown and decreased earnings are mostly priced into this market. That is why we don't move much on warnings from tech stocks. But Bank of America is hardly a tech stock. And we hadn't sold off on the financial sector yet. . . . .and there could still be some "Unibombers" out there that had been forgotten. . . . Asia? Euro? Retailers? Another irresponsible comment by a well-known anal-yst?
This is an odd market to say the least. But one thing is becoming clear. The recovery will be a hard fought battle. And I believe that yesterday's action was a precursor of more to come. In other words, we sell off slowly. . . dripping lower on slowing volume. . .day after day, then suddenly BURST!! northward when the fewest possible Individual Investors are able to make gains.
IE: Naz. . |: 30 pts lower, 10 pts higher, 20 pts lower, 10 pts lower, 200 pts higher on gap up. . . 50 pts lower, 10 pts lower, 35 pts higher, 20 pts lower, 30 pts lower, 200 pts higher on gap up. :| REPEAT over and over.
So as it looks like a dull market and a down market, the "burst days" cause the longer range trend to be higher.
This scenario requires one of two actions. . . either being constantly tuned to the swings of volume, TICK, etc. and quick trades based on timing the market swings. . . . or lots of patience on holding those terrific tech values that we went into a few weeks ago. Or for those of you practicing Hybrid Trading, a bit of both.
Now I still believe that the announcement of a president and/or the Neutral bias "statement" will serve to empower the bulls. But there are no guarantees that either will be quick in arriving.
Hope that helps some. . . I realize the answer is somewhat vague. . . sometimes there is less fog than others.
Rande Is |
