Complacency Indexes Message Board

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Strategies & Market Trends : Complacency Indexes

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To: eddieww who wrote (1458)	6/22/2002 11:40:18 PM
From: ajtj99	Read Replies (2) of 1487

Eddie, if we get to QQQ 20.25 on this drop, there is a very good chance we won't get above QQQ 25 on any rally. I guess you'd still make some money if that happens, but I just don't see the reasoning if you can buy a re-test, which always happens. You could be buying 30% above the eventual bottom in your method. I highly recommend you check out the prices on the Jan. 3, 2001 lows, Sept. 21, 2001 lows, and the Feb. 22, 2002 lows. You could nearly buy the bottom again at the re-test in all of these instances. You catch bottoms on the re-test, not on the initial bottom. Feb. 22 low - NDX 1330. Feb. 28 re-test: NDX 1369. Sept. 21 low - NDX 1088 Sept. 27 re-test: 1101.39 Jan. 3 2001 low- NDX 2087 Jan. 8 re-test NDX 2151 The average difference between the re-test and the actual bottom is 1.75% on these 3 occasions. That's like having a bottom at QQQ 23 and buying it at 23.40. The re-tests each occured 3 or 4 sessions after the initial low. I highly recommend this approach, but I understand your comfort with what you're doing. I was only trying to help you get a better entry on your buys.

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