Mike, the problem I see is the divergence, in real bull moves the number of new highs and the volume expand, they do not contract. That by itself is of course not sufficient, and indeed this market with all the sloshing liquidity could turn be the real McCoy, but even with today's close, we have not really made much progress since the surge leading into April 20th, many of the stocks I follow, I sold at higher prices than today's close, so being "cautious" is missing nothing, except, possibly one of the many zigs and zags within, what right now could be either massive distribution or healthy consolidation. I still lean to the distribution thesis for reasons I have cited many times before.
I don't expect to catch all the zigs and the zag, being in on the long side for 60% of these and out of the declines for, hopefully more than that, is quite sufficient for me. In the meanwhile, I am still playing the daily pattern when I think it can be profitable. It is quite rare for a bear market of the proportion the Naz suffered to end up with a V bottom, without going and retesting the lows three four months later, aorticularly when the drop in late March early April, was really not that cathartic.
Zeev |
