Playing the QQQQ with Terry and friends. Message Board

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Strategies & Market Trends : Playing the QQQQ with Terry and friends.

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From: Walkingshadow	5/12/2009 10:35:49 PM
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VALUATIONS: Are we there yet? There is a lot of talk about valuations going on. The consensus is that based on valuations during previous recessions, we have not yet reached low enough valuations, and that this is required before the market finally bottoms. That, in turn, predicts the market will set lower lows. The valuation topic is not straightforward, but I think the above is essentially correct: QQQQ must set a new low below the March 9 lows ($25.74 closing price). But personally, I don't think it will be far below this point. I think we will see the SPX trade down to about 650. That would be a drop of 28% from current levels (SPX closed at 904 today). It would also be a new 13-year low. That would imply that QQQQ would trade down to about $24.50 or so (on a closing basis) at its final bottom. More on the valuation arguments: hussmanfunds.com safehaven.com peridotcapitalist.com WS

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