Birchtree's Account Talk

[Birchtree]

Re: Birchtree's account talk

I'm going to ignore the markets panic and overdone hedge fund liquidations and concentrate on the fundamentals and remain prepared for the turn around. The S&P 500 companies are collectively at less than 17 times their earnings for the 12 months through June. The last time the S&P 500 regularly traded below 17 times reported earnings was in 1994 and 1995 - before the late 1990s stock market surge. The chain deflator inflation rate is comfortably at 1.8%, so the Fed has ample room to ease if they wish. With the recent drop in the S&P 500 we are close to its eight-decade historical average of 16 times reported earnings - and far below the 46 times earnings recorded earlier this decade. The Fibonacci 61.8% line is at Dow 12,752 - which we may easily see tomorrow. Be right and simply sit tight. Snort.

 

[Bullitt]

Re: Birchtree's account talk

Forget Fibonacci. Even if the Dow finishes the day within 100 points of a Fib retracement some technician will say 'I told you so'. Technicians are always discovering new significant moving averages too. If it all worked so great then these Quant funds would be rocking with the recent volatility, but they aren't. Most important is the current PE of the SP500 and the amount of smart money/inside money flowing into the market the past 2 weeks.

How funny is it that these people invested in hedge funds wishing to bail won't be able to withdraw until their 30-90 day redemption period ends. By that time we'll be on our way and they'll be trying to get all of that money back into the market.

 

[wht00ss]

Re: Birchtree's account talk

remember there big birch you ain't lost a dime until you sell so sit tight and be right - by year end you will be looking like a hero.


white

 

[dell]

Re: Birchtree's account talk

Have we reached the 10% correction level yet?? If not, where is it (i.e. - what numbers do we look for)??

Dell

 

[fabijo]

Re: Birchtree's account talk

Have we reached the 10% correction level yet?? If not, where is it (i.e. - what numbers do we look for)??

Dell

We have. That's what they keep talking about on Bloomberg TV right now.

Edit: S&P 500 and the Nasdaq have. I don't think Dow has yet.

 

[robo]

Re: Birchtree's account talk

Birchtree,

Some words from Keith, coming your way.

Robo

 

[Birchtree]

Re: Birchtree's account talk

The Dow penetrated the 10% level below 12,600 on the first drop of 343 points, then rallied up to -100 before heading down to retest at 12,500. The move off the bottom the second time occurred in 2 hours and ran up over +343. It would be nice to finally get a +343 off the open tomorrow. I had resigned myself to give up some heavy K today - only to be spared this time - heck yesterday was deep enough. Someone said the degree of negativity being felt reminded him of the Oct'02 bottom - could be, that was soon followed by the March'03 bottom and then a 3,000 point rally commenced. The same scenario will have to play out for me to get 15,600 by the end of the year - and I haven't given up on that quest. I was definitely holding both my cheeks today and may have to do the same shortly if we haven't bottomed yet. But perhaps there is still so much bull manure around that we'll see the infamous big V powered by all the new shorts and capitalist Chinese. Snort.

 

[rokid]

Re: Birchtree's account talk

As long as you don't need your money in the near future, you should be fine.

Leveraged people and people who need their money are freaking.:nuts:

 

[robo]

Re: Birchtree's account talk

The Dow penetrated the 10% level below 12,600 on the first drop of 343 points, then rallied up to -100 before heading down to retest at 12,500. The move off the bottom the second time occurred in 2 hours and ran up over +343. It would be nice to finally get a +343 off the open tomorrow. I had resigned myself to give up some heavy K today - only to be spared this time - heck yesterday was deep enough. Someone said the degree of negativity being felt reminded him of the Oct'02 bottom - could be, that was soon followed by the March'03 bottom and then a 3,000 point rally commenced. The same scenario will have to play out for me to get 15,600 by the end of the year - and I haven't given up on that quest. I was definitely holding both my cheeks today and may have to do the same shortly if we haven't bottomed yet. But perhaps there is still so much bull manure around that we'll see the infamous big V powered by all the new shorts and capitalist Chinese. Snort.

Birchtree,

More work ahead, but in my opinion we are forming a bottom and could already be at the lows for the year. I added a bunch of shares today in my scaled buying and will add more at these prices. I paid up and bought my ticket so pick me up at the next stop. Folks say not to try and pick a bottom. I say I'm not smart enough to pick a bottom. So, I'll keep scaling in at these sale prices and let the bottom form. Stocks are on sale and I'm a value buyer. If it goes down some more, I'll buy some more. Soon I'll be fully invested in my longer-term accounts. Now, my trading accounts is another story.

 

[Birchtree]

Re: Birchtree's account talk

On Wednesday 1/24/07 the NYSE ratio adjusted A/D (RA-AD) line record high set in early 1959 was broken. Elliot wise, this move to new all time highs on the ratio adjusted NYAD changed the current Dow count from being Intermediate 3 of Primary 5 to Intermediate wave 3 of Primary 3 to the upside. Suffice it to say the Primary 3 waves can last for years and may achieve the Harry Dent targets of Dow 30,000. One historical trait of new highs in the A/D line, is any ensuing price correction is muted. Man am I ever trying to remain creative. When price and the A/D line top out at the same time, there has never been a price correction significantly exceeding 10%, as measured by the SPX. The current decline has brought the NYAD (RA-AD) back close to but not below the breakout line from 1959. If we bounce from here we are on a bottoms above bottoms pattern. I think we may hold the 48 year test of time. This correction will create a healthy environment for future new highs going forward - 30,000 who knows for sure - consult the Shadow.

 

[fabijo]

Re: Birchtree's account talk

Birch - very exciting news. Thanks for that info.

 

[Birchtree]

Re: Birchtree's account talk

"Consider the Hulbert Stock Newsletter Sentiment Index (HSNSI), which reflects the average recommended stock market exposure among a subset of short term market timing newsletters. As of last Thursday night, the HSNSI stood at a minus 11.3%....To put this consensus recommendation into perspective, consider that the lowest the HSNSI got during this year's late-February-early March correction was 17.4%, or nearly 30 percentage points higher than when it stands today. Yet, despite the HSNSI being so much lower now than then, the DJIA is 800 points higher. This is very revealing and does require sugar creativity. Usually sentiment rises and falls more or less in tandem with the market itself, with advisers becoming more bullish as the market rises and more bearish as the market falls. When sentiment trends significantly deviate from this general pattern, it means that advisers have become unexpectedly bullish or, as in the current case, exceptionally bearish.

That's good news from a contrarian point of view, since bull markets thrive on the kind of skepticism we are seeing right now".

http://www.marketwatch.com Mark Hulbert - Short Course

The SPX dropped 12% or 185 points in one month - I do recall a time when the SPX rallied 72 points in one day - so be prepared for any eventuality. MCO now has a higher high and a higher low and the MCSUM is turning up as a result of last Thursday and Friday markets. Support will be broken only if the market starts pricing a recession. As long as breadth plurality remains positive the near term trend is up. Because the Fed trading desk has been trading paper at 5% and lower for the last week and if it continues we should see another Discount rate cut. Here comes 1995.

 

[Birchtree]

Re: Birchtree's account talk

I'm enjoying being on the come back trail again. The Oceanic is up $86K and the Tugboat is up $23K from the August lows as of yesterday. I have many dividends that are arriving to help with DCA. I would like at least one more $16.00 dollar range purchase before that price is history. As I always say - be right and sit tight, 15,600 is just around the corner. It has been two years in a row that the low was made in August and it did not retest last year. The number of new lows that were posted was the second highest in history, August 31, 1998 was the first. The closer we get to the epicenter of wave 3 of Primary wave 3 the higher the level of volatility and the higher in price we go. Snort.

 

[Birchtree]

Re: Birchtree's account talk

" The PPT's strategy is to offset weakness in the U.S. housing market, with increased household wealth in the stock market, to avoid the dreaded "R" word - Recession".

http://www.safehaven.com/article-8254.htm

 

[Birchtree]

Re: Birchtree's account talk

I made 199 individual stock purchases all the way down to the bottom - and I'm chomping on the bit to start buying all the way up. But temporary prudence may be the better part of valor - I don't want to declare any more profits this year and taking more capital gains will be necessary to raise cash. Unless my inhouse banker will voluntarily cough up some tender spill. Once we get past 14,000 I'll begin a campaign to get a small loan from her to be repaid after the first of the year. I refuse to let this once in a lifetime investing opportunity pass me bye. I'm going to patiently wait on the second coming of the wave 3 epicenter and take that rocket ride to several million. And I'm currently set up with my asset base to take that ride - all I have to do is be right and sit tight. Snort.

 

[Birchtree]

Re: Birchtree's account talk

Perhaps the SPX is going to make a push for the 50 ema at 1480 and then that becomes support. The SPX breadth MCSUM found its' bottom around negative 750 - same as the June'06 lows and is currently at -664. It's nice that the NY ratio adjusted A/D line has kept above the previous breakout line from 1959. There is a decisive curl up in the NYSE breadth MCSUM, so we may be ready to come off the bottoms. It should also be noted that skirt lengths for Spring 2008 are well above the knee - wow, that's very positive.

 

[qibovin]

Re: Birchtree's account talk

It should also be noted that skirt lengths for Spring 2008 are well above the knee - wow, that's very positive.

That does it...I'm getting bullish right now!

Wow, I'd love to see someone crunch the numbers on this one. I would not be surprised to find an associated trend with a number of fashion trends. I think I'll put Zoolander on my Board of Directors.

 

[GUCHI]

Re: Birchtree's account talk

Birch

Lol !!!! I Did Not Realize That Skirt Length Was A Market Indicater !!! But When U Think About It Skirt Legnth Can Do Alot Of Thangs !!!!!

 

[qibovin]

Re: Birchtree's account talk

Skirt Legnth Can Do Alot Of Thangs !!!!!

Maybe there'll be another Baby Boom just in time to start feeding the Social Security Ponzi moster as I retire.

 

[Eldritch Flatus]

Re: Birchtree's account talk

lol..lol..lol....all over again!.....Heh Thanks Paladin