From another thread, a snip.
But sounds good to me.
:0)
Stan
Conclusion:
There is little doubt in my mind that we have seen a massive amount of capitulation this week. At its worst Wednesday, the DJI had fallen over 1100 points this week!! Wednesday saw a violent rally after another down shock wave, and we like dramatic activity accompanied by high volume. Wednesday was the second day this week where NYSE volume was above 2 billion, with Monday posting an all-time high. What is also seen in a market about ready to post at least a good rally is high levels of bearish sentiment.
The VIX index has had highs of 47.7 on Monday - 46.67 on Tuesday and 47.62 Wednesday. Three very high readings, which have, in the past, been a pre-cursor to at least good rallies, if not a low.
The oversold level reached a monster minus 12.1 - I can't remember the last time it was that deeply oversold. 10/19/87 is probably that time.
The I.I. figures showed the bearish camp above the bulls (35.7% bulls and 37.6% bears) for the first time since the September-October period of 1998. That was the bottom of that bear market.
Having outlined all of the above, I must say that there is such uncertainty - what President Bush does to those evil "things", more huge airline layoffs, etc. Futures, as of 6:00 a.m., point to a lower opening, which gives the market another chance to go out really plus. Frankly, I'd wait for a good close. If the market can do it right, there'll be plenty of time to play.
Ralph Bloch
Senior Vice President |
