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Strategies & Market Trends : CFZ E-Wiggle Workspace

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To: the-phoenix who wrote (4803)3/15/2006 10:54:00 PM
From: venividivici  Read Replies (2) of 41447
 
Thanks, you and skinowski have been great on this thread as well. I was really excited when it started back up and hope we can continue with a low noise, high impact thread.

I'm not ready to throw in the towel either. Even though we've retraced a lot of what I had been calling the 1 of C, we still haven't gone over the top of B at 1701 NDX 42 QQQQ. My exiting of all short-term shorts today could be very temporary. Heck, even if we're finishing a v of something up, we could retrace to sub-41 by Friday no problem. If I see something like that shaping up, I'll be loading up on puts.

I read something very interesting about the ratio of the S&P 500 to the price of 10 year bonds. We reached an extreme today that has only been seen a few times in the past 40 years and only 6 times since 1994. The gist of that means something very bearish could be on tap. When it hits, the bearish reversal starts between 1 and 10 trading days, and 3 out of 6 times, it's only been 1 day. Apparently, the reason it works is that it's the sort of relationship that can cause strategic asset allocation shifts on the part of institutional investors, because bonds are cheap and stocks are expensive. We'll see.
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