Birchtree's Account Talk

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Birchtree said:
"You must truly love the market cause it will break you down mentally."
Click to expand...

Naw, it's just one of those things.

Anyone jumping in after a few good days is taking a pretty big chance of getting burned. The Mental Break Down is mainly when you're used to looking at one or two day plays.

The longer you stay in --- the easier it gets -- so it's actually feeling more comfortable knowing you're ready when things go UP.
 
Thanks Birchtree for all of your post here. I look foward to reading your post.

I'm new to this forum, trying to learn from those who have experience.

Hope this bounce holds today...almost 3 hours of trading to go showing an increase of around 190 points.
 
Richard Russel says, "As typical last March everyone was bearish and the market was establishing a temporary bottom. Now that everyone is optimistic, the stock market is topping out and the public (the amateurs) are about to receive theie second round of pain." Funny, I don't believe a word of it. The bull is on a rampage again.
 
Hey Birch, I'm new to the tracker and MB but I've been lurking for a few years. I've watched you build your credibility during the Spring, Summer and Fall of 2009. Others seemed to be touting Fundamentals and Technicals while you talked about personal experience. You won that round. But now that "Wall of Worry" is popping back into view and from what I can see the underlying pinnings of a continued advance really aren't there, if they ever actually were. But I've also learned that ups and downs may have nothing to do with real numbers and that perceptions or manipulation may be more important at times. So, just curious, do you see any real numbers that support economic growth? I'm not being a Devil's Advocate or trying to bait you, I am really looking for that positive indicator that seems to be hidden from my view. I am but an egg, any light you, or other esteemed Masters, could shed in this regard would be greatly appreciated. There are plenty of nay sayers around here lately, I'm just hoping for a real basis for a positive outlook.

Thanks.
 
"Currently 72% of stocks remain above their 200 MA, but only 24% of stocks are above their 40 MA. The only other time since 1986 the difference has been this large was late October/ early November of 2009. To get such a large difference between the readings you would need to have a strong pullback occur in a strong uptrend. From a long-term perspective, such sharp pullbacks have been followed by additional buying. Instances all rallied through their old highs and kept rising."

http://quantifiableedges.blogspot.com

The typical cyclical bull market lasts three to five years so any correction or consolidation is for buying. Right now we are in a nice cyclical recovery in corporate profits and productivity - this alone should continue to drive the bull market. I believe we are in the first leg of a new secular bull market that could last for the next ten years. And I'm prepared to benefit from this bull move.
 
On Feb 9 The NASDAQ added one 50/200 Golden Cross and seven 50/200 Death Crosses. That was on a good day. It's not too late for you to sell...
 
"Rydex Market Timers: Are Now Bearish. The current value of the indicator stands at 0.93 suggesting that the Rydex timers are now bearish, and this is a bullish signal."

http://safehaven.com/article-15767.htm

The CBOE put/call ratio at 0.70 is close to the 0.77 level of July '09. Almost 70% of stocks are now below their 50-DMA. Can you feel the earth shake as the herd gets ready to stampede? You know from a contrarian standpoint what is in store. It's early in the year and historically equities have averaged at least 3 declines a year of 5% or more, and one fall of 10% or more - count this consolidation as #1.
 
Birchtree said:
"Rydex Market Timers: Are Now Bearish. The current value of the indicator stands at 0.93 suggesting that the Rydex timers are now bearish, and this is a bullish signal."

http://safehaven.com/article-15767.htm

The CBOE put/call ratio at 0.70 is close to the 0.77 level of July '09. Almost 70% of stocks are now below their 50-DMA. Can you feel the earth shake as the herd gets ready to stampede? You know from a contrarian standpoint what is in store. It's early in the year and historically equities have averaged at least 3 declines a year of 5% or more, and one fall of 10% or more - count this consolidation as #1.
Click to expand...

:confused: What does this mean in regard to which account I should be in? The G, C or the I fund? I am in the G fund now. Thanks a bunch!! Joy Lynn :confused:
 
joylynn,

It's time to get into the C fund and let the chips fall where they may. This market can scream higher back to SPX 1158 at any moment and you have to be there to participate.
 
Britts4life,

Taking into account that the market is a discounting mechanism for the future - the question becomes how far into the future is it seeing. The market is omnipotent and you may not be able to see at the moment what it sees - we are mere mortals. The only thing we can do is hedge the best way possible and that means following the fundamentals and looking at the technicals which are basically based on emotion. I happen to be a renegade contrarian and therefore must lean against the masses. The economy is improving and interest rates will stay low for at least another year and liquidity is what drives the market. Watch what happens when money leaves the bond market. Based on the stock market's history, there is only a 9.4% chance that the current decline will turn out to be a bear market. The ISM is improving, we have an upward sloping yield curve, jobs will return to America, there was a 77% rate of SPX earning beating analysts expectations. We could talk about bearish sentiment and our current consolidation which was necessary and healthy. The market is still cheap. Consensus earnings for $77.50 pegs the SPX at a P/E ratio of just 14.4 - below the average of 16.3. I'm staying strong and holding long.
 
JTH,

If you could see my IRS tax forms you would know that I made too much money in 2008 by selling my commodity stocks. Even though my account did suffer a $1M haircut it was a devaluation and not a declared loss. I sold more stock at the end of October '09 trying to stay in front of that consolidation - that racked up close to $90K in profit that I will have to pay tax on. I've even declared a few dollars profit this year trying to stay ahead of a margin call. Maybe some day you'll be more gracious when you achieve a $2M account. This current consolidation forced me to back up to the tune of $189K but I haven't figured out the profits on these transactions yet. By the way that $189K in transactions only cost me $147.
 
Birchtree said:
Maybe some day you'll be more gracious when you achieve a $2M account.
Click to expand...

At the rate my three kids eat, I don't think I'll ever see 1 million. If it was up to me I'd live in an underground tunnel and live on rice like Charlie, but I can't seem to sway the wify on that lifestyle...
 
I've been building on my lamb chops portfolio today buying large blocks of ACI, CX, GCI, JCI, RKT, GT. I'll continue this strategy for several more weeks until I build about a $250K buffer as protection against a rub out margin call.
 
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