I think we all may be missing something here Raptorface, as action this month has been somewhat perplexing. Earnings are coming down and they are not getting any better, so the market is just about as overvalued now as it was a year ago. Companies are meeting or beating REVISED estimates which are lower....it's illusionary. The high market volume also should have taken things much higher. The FED has been pumping money into the economy like mad, and gives a surprise 50bp cut. The credit situation has not changed where people are drowning in their debt, and with a recesion looming, dotcoms going out of business, and the pace of layoffs picking up now, it won't make things any better. The Callifornia energy crisis will have repercussions soon enough as energy is being bought to meet demand at exhorbitant prices, and don't forget that natural gas has tripled in price as well, which has cut into earnings for many industries. There is a lot going on that I'm sure we don't understand, but the bottom line is we have to be cautionary.
I am a strong advocate of short term positions right now as things are so uncertain and changing so fast that we can't tell what will happen to any one company, any sector or the economy as a whole in 6 months. Your stock may tank or it may soar. Scan the charts and you'll see that volatility has increased several fold. Mutual funds aren't making a lot of money these days.
We are traders...don't marry a stock. Make the trade based on some solid reasoning and when this changes it's time to find something else. In my opinion, I think the market is setting itself up for a big disappointment, but then I trade the market as I see it and pick my trades carefully. |
