Hi Eichler,
Another mind-blower that would cause quite a serious stir, would be a series of super "gap-ups" during the lazy summer days for "no apparent reason." Imagine a lazy week of trading, in mid July that lulls everyone to sleep, and then, BAM!!! The following Monday, NDX gaps up 16% on NO NEWS! People are stunned and the shorts scramble to figure out WTF! Then the next day, NDX gaps up another 15%, and that Wednesday, another 17%, with Thursday and Friday adding on another combined 12%! CNBC cheers it on, and scrambles to bombast "the official reason for the rally" all over us. After hemming and hawing, they wittingly proclaim the numerous rate cuts have finally worked their way into the equation. Yes, of course, those rate cuts! That's the answer! Before "Joe Public" can figure out what is happening, he is very suddenly facing an NDX value of over 3400. "Joe Public" will have been been whipsawed to hell because he waited too long to buy. Again, he has "sold low" and now he must "buy much higher."
This scenario is quite likely, but I think it may be more probable in October of this year, when most people expect the tires to fall off again. That would certainly catch the most "weak hands" napping, thus producing maximum damage to the small investor. Rest assured, shorts will be maxed out by then, expecting the worst.
This is just a dream I had. I could be wrong and these are NOT predictions or what I really believe will transpire!
Ciao,
John |
