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Strategies & Market Trends : The Stock Market Bubble -- Ignore unavailable to you. Want to Upgrade?

To: Tommaso who wrote (2169)	10/16/1998 10:44:00 AM
From: Gwolf	Read Replies (1) \| Respond to of 3339

Tommaso, I think the action overseas is giving us a preview of things to come, after an initial rally they retracted. Just because the Fed lowered rates to help out the banking system and currencies, it doesn't stop the overall global problem in the slightest. This was a liquidity play that will take months to show up in the system. I personally think that our longer term view of the problem is correct. Bobby, the indicators you are referring to are very short term in nature. The put/call ratios swing rapidly along with the CBOE volatility index ( VIX)and do indicate short term bottoms. However if you look at the Investor Intelligence readings of 41% bears you will realize that this is a long way from signaling a significant bottom. The investment advisors should exceed the 50% for some period of time indicating true capitulation before a bottom of any significance can be established.I also think that one magazine article does not represent the usual string of magazine covers and articles that would constitute the fear and loathing that occurs at major bottoms. I completely disagree that we have seen the complete lack of interest in the market that accompanies major bottoms. We may have seen short term indications from the put/call ratio of the potential for a bear market rally, but those rallies are to be used as an opportunity to establish new positions on the short side, not to go long. Gwolf