Show-me Account Talk

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Show-me said:
Looking at the chart I see a interesting pattern. Look at the record breaking rally we had on Columbus Day and the following day. The same pattern of a second day push higher than a no legs or profit taking sell off followed by lower prices.

http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=3&dy=0&id=p35575289232
Click to expand...

yeah, I saw that too show me. If you look at the rally BETWEEN those two other rallies, it was up, then pause, then up again. I'm hoping today we have an "up again"...then I'll sell.
 
Show-me said:
Looking at the chart I see a interesting pattern. Look at the record breaking rally we had on Columbus Day and the following day. The same pattern of a second day push higher than a no legs or profit taking sell off followed by lower prices.

http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=3&dy=0&id=p35575289232
Click to expand...
Show-me, To bad we are not better chart readers. :D If I would have jumped back to the lilly pad around August 25th when the 20 and 50 MA crossed I would have been near +5% YTD (or better) than sitting near 26% YTD (per the tracker). Good luck today.
 
Make no mistake I will only peel a little out of the market for a hedge. I feel this is more risk being out of the market than in the market at this level, but one should sell any strong rally and have some bullets for the next dip.

IMO, there will be a next dip as the credit market is what drives the consumer on a global level. Remember 2/3 consumer driven economy here and the GDP number is a lagging indicator.

DCA is still the answer at this level. It was difficult to trade with a noon cut off and now it is even more difficult with two trades. Accumulation, accumulation, accumulation, but keep some powder dry for 744.
 
Show-me said:
Looking at the chart I see a interesting pattern. Look at the record breaking rally we had on Columbus Day and the following day. The same pattern of a second day push higher than a no legs or profit taking sell off followed by lower prices.

http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=3&dy=0&id=p35575289232
Click to expand...


I see what you're talking about, but I don't completely agree with the chart analysis and its potential as a trend. Here's a couple other technicals worth considering.

MACDs for both S&P500 and DJIA have first tested and have now crossed over their respective trendlines and both moved above zero. This is the first crossover since they went below after Labor Day and it is doing so on good volume. Anything green today will solidly confirm that trend. PMO should also crossover trendline today if we end in the positive.

Sentiment is not a great gauge, but I think it's going to be high going into next week's elections and beyond. AAII sentiment is holding at or near 1:1 ratio for a third straight week. I'd love to see some of Tom's analysis on Smart Money vs. Dumb Money. (hope you're listening Tom...)

This week's gains closed a downside gap made on 22 October (best seen in the NASDAQ). There's one more downside gap remaining, made on 6 October. S&P500 would have to get to 1100 to close that gap. That would represent a 16% gain from here and may not be realistic in the short term, but I think a test of 1000 or above is possible.

Bottomline, I think this rally still has some legs in it, and I definitely agree with you that it is riskier to be out of the market right now.

Good Luck!
 
anthony,

You've been doing your home work - thanx for the facts. Everything I bought this morning cost me more than yesterday. However, everything I bought yesterday is now more expensive today. Any sign of the big V yet?
 
turbo23dog said:
Please explain "Big V".

I'd guess it refers to chartology. I imagine appearance of a V shape would indicate a turn around from market lows.
Click to expand...

Big V theoretically ... as in everyone figures we're going to test the lows again, but instead the chart just keeps going up with nary a look downward, thereby forming a V shape. Everyone who decides to sit on the platform gets toasted by rocketfuel.

Might be a little wishful thinking at this juncture, but one of these days (as in within the next 12 months) the cash on the sidelines is going to start deploying. When it does, lots of people are going to be trying to catch up or jump on.

Personally for me, a lot of that chartology, heads and shoulders and such makes about as much sense as seeing a horse and a bunny in a cumulonimbus cloud ... but who knows!
 
Show-me said:
November is the #1 performing month for the S&P and more so in a election year fwiw.
Click to expand...

...obviously a good time for everything to break. None of that stuff matters IMO as we are in a black swan event.

I think the fourth quarter data will be SO BAD...it will easily cause us to break 839 and test the 2002 lows in the 770's or so. Then, maybe a little rally off that low but I think job losses will continue and weigh on the economy. Look at mortgage rates...they rose 0.42% last week. Oil may have nowhere to go but up at these levels.

The treasury is going to have to issue loads of t-bills and that will dilute price and cause yields/rates to go up further. If they issue long end off the curve it hurts mortgage rates...if they issue short term stuff it hurts banks since they borrow short and lend long.

American Express cutting 7000 jobs. Hmm. I thought they were like the best credit card company...with only "AAA" rated customers :-) We are going into a downward spiral...it may be a slow death but I"m shooting for S&P in the 600's.
 
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