>>>>Sentiment is bearish, just most of the prior exhaustion run up to NASDAQ 5000 is preventing most from announcing bearishness for the fear of looking stupid. The plunge in consumer confidence to four year lows is enough of a bearish signal to me. Lack of confidence in Greenspan is another bearish signal. Fund distributions are at the highest reading since the Asia crises.>>>>
sentiment is a tricky thing, because during strong trends, sentiment reaches what seems to be extreme and near reversal sentiment, but only causes a reaction to the trend, sentiment has to be tempered with the trend, i think larry mcmillan uses a good indicator here for using a moving average cross-over of the put/call ratios.
of course the market will fluctuate and this downtrend will turn to an uptrend, but trying to pick the bottom here is as foolish as bearz trying to short the nasdaq parabolic to the top, people have been trying to call the bottom since early sept, and many people have been trying to call this swing down from the feb meeting since feb 6.
yet the downward earnings surprises continue, one after another, and these people think it can't get anymore oversold, just like the bears thought it couln't get any overbought on the upside.
the best indicator of the trend, is the trend itself, the trend in nasdaq, fundamentally and chartwise is extremely bearish,
after a 60% drop in nasdaq they should be saying this is the end of the world as we no it, like they did in 1987, but the only wall of worry left seems to be missing out on the bottom. |
