Market Talk / Oct. 5 - 11

[Spaf]

Market Talk
Sunday Edition
October 05, 2008​

General Commentary:

Well we've got ourselves a nasty bear market, too volatile for any trades. All monies are in index funds or cash. Don't know what shoe will fall next.

Fundamentals don't look good; earnings, economics and growth. Charts and technical analysis are bearish and volatile.

A look at the chart(s)
The S&P500 [$SPX] Daily
Large Caps

Charts courtesy of www.StockCharts.com​

The 50d E-moving average remains in a bearish downtrend.

The P-SAR turned bearish Monday week ago.

The Bollinger bands have large spacing, indicating volatility in the fund.

The S-STO was bearish, in oversold conditions (13.35).

The MACD was bearish.

Well, that's it for the weekend!​

Be careful out there!​

 

[James48843]

Jim Cramer: Time to get out of the stock market

Financial guru warns that investments could lose 20 percent of their value


By Michael Inbar

TODAYShow.com contributor



Bullish investors should turn into shrinking violets as the stock market continues its shocking downward spiral, CNBC’s “Mad Money” host Jim Cramer told Ann Curry on TODAY Monday.

In what Curry called a “dramatic statement,” Cramer emphatically urged any investor who has money they may need in the next five years tied to stocks to pull their dough out.

“I thought about this all weekend,” Cramer told Curry. “I do not want to say these things on TV.

“Whatever money you may need for the next five years, please take it out of the stock market right now, this week. I do not believe that you should risk those assets in the stock market right now.”

(complete story: http://www.msnbc.msn.com/id/27045699/ )

 

[James48843]

VIX now above 50!

 

[Mike]

I guess that 1000 downside target Tom had for the H&S pattern is going to be tested pretty darn quick.

 

[James48843]

VIX now above 53.

 

[Mike]

What did the VIX top out at in the last bear market, James?

If this isn't a capitulation sell-off, it sure as hell looks like one.

 

[McDuck]

too volatile for any trades.

I feel the same way. I have tried to catch a falling knife too many times in the past.

 

[hessian]

One perspective on the VIX (plus othe analysis...) :worried:
http://stocktiming.com/Monday-DailyMarketUpdate.htm

 

[James48843]

VIX now above 55. Levels not seen before. Ever.

The VIX chart started being tracked in early 1990's, but here is a chart using VIX criteria, that shows we are now near the VIX levels of the 1987 crash.

We just past VIX of 55 and climbing.

Here is a historical VIX going back from the mid2006 time frame back to the mid 1980's:

View attachment 4802​

And then here is the VIX today- we had a high of over 56 a little while ago, although we are off the highs of the day now:​

View attachment 4803​

I need an alka-seltzer.

At least we're off the worst numbers of the day. Whether this is a bottom remains to be seen. A lot of people are selling today. I don't have the stomach to do otherwise myself.

Probably a mistake- but I am bailing.​

 

[Elgallo]

Cramer is sending a mixed message, at least as far as I am concerned.

He is saying SELL everything TODAY, but just Friday he said keep dollarcosting into the big indexes which is what I and a lot of others do.

With the VIX above any historic level seen before, is his SELL advise wise?

Comments on selling out now are welcome.

 

[FUTURESTRADER]

Cramer is sending a mixed message, at least as far as I am concerned.

He is saying SELL everything TODAY, but just Friday he said keep dollarcosting into the big indexes which is what I and a lot of others do.

With the VIX above any historic level seen before, is his SELL advise wise?

Comments on selling out now are welcome.

If you have to ask, you haven't done your due diligence. That said, I would suggest selling a partial position so you can sleep. Nibbling in and out and accepting that as a strategy is a lot easier on the psyche. That way you're never 100% wrong though never 100% right. It keeps you in the game longer thereby giving you a chance to learn. Losses are usually quicker and steeper.

 

[James48843]

If you have to ask, you haven't done your due diligence. That said, I would suggest selling a partial position so you can sleep. Nibbling in and out and accepting that as a strategy is a lot easier on the psyche. That way you're never 100% wrong though never 100% right. It keeps you in the game longer thereby giving you a chance to learn. Losses are usually quicker and steeper.

Unfortunately, with the new TSP trading restrictions, nibbling is not allowed. Each nibble counts as "one" move. Nibble twice, and you are locked out for the rest of the month, and can't nibble back in.

Thank you ETAC for allowing this to happen- for NOT putting up a fight.

 

[Mike]

To put it bluntly, I think selling right now is insane.

Unless the market is about to crash, I'd say we are due for an explosive (but sadly short-lived) rally. If you really can't endure more bear market pain, at least wait for the inevitable rally. The odds favor that far more than a crash.

The fact that the tv talking heads are in "the sky is falling!" mode further reinforces my belief on this one.

 

[Elgallo]

I have a tendancy to agree with you Mike. But WTF do I know!!!

 

[FUTURESTRADER]

To put it bluntly, I think selling right now is insane.

Unless the market is about to crash, I'd say we are due for an explosive (but sadly short-lived) rally. If you really can't endure more bear market pain, at least wait for the inevitable rally. The odds favor that far more than a crash.

The fact that the tv talking heads are in "the sky is falling!" mode further reinforces my belief on this one.

we are in deep doo doo...all that real estate still waaaay overvalued...we're not goin up until that is cleaned up, and that will take a few more months at least

 

[Pilgrim]

The ban on short sales is set to expire midnight Wednesday. Anyone heard rumors about it being extended? If it is not, I don't think the world will melt down Thursday morning, but fear of that happening may make Tuesday and Wednesday more difficult than they would otherwise be.

 

[Mike]

How you view the market going forward depends on how you view the economy - if we assume we're going into a deep recession that will last 12-16 months, then the recovery won't start until the end of next year economically speaking. However, since the market looks ahead six months, the stock market recovery would probably begin by June of next year - which is why I say it's utter lunacy to sell now. The market explodes off of lows. By the time the general public regains confidence, most of the gains have been made.

 

[James48843]

...However, since the market looks ahead six months, the stock market recovery would probably begin by June of next year - which is why I say it's utter lunacy to sell now. ....

OK- I'll buy in next May.

 

[Pilgrim]

How you view the market going forward depends on how you view the economy - if we assume we're going into a deep recession that will last 12-16 months, then the recovery won't start until the end of next year economically speaking. However, since the market looks ahead six months, the stock market recovery would probably begin by June of next year - which is why I say it's utter lunacy to sell now. The market explodes off of lows. By the time the general public regains confidence, most of the gains have been made.

So when, in your opinion, should people on the sidelines move back in?

 

[Spaf]

To put it bluntly, I think selling right now is insane.

I agree, well maybe; to sell the C-fund is insane since it is made op of over 500 various companies. To sell sectors such as financials [LEH] Lehman (lemon) is a day late and a dollar short......Are we talking about nuts or melons......:blink: