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At 07:42 AM 9/3/99 -0700, Phil Lane wrote:
>anybody noticed - every time they start posting stuff about the crash of
1987 the market takes off for a huge rally within a >couple days!
If market close on the highs, we all could ridicule the bears, as they
would happen to be wrong today.
But as of yesterday, the market was in very dangerous technical position,
and be the employment report "bad", the market would be pushed over the
cliff. As of one person saying "look at 1987" or whatever it is just
"anecdotical" evidence of the bearishness. There are objective sentiment
indicators like put/call ration, option premiums, amount of the money in
bear/bull funds. The problem with all of them, that no meter how "oversold"
those indicators they always could get more so.
Even as majority of technical indicators (at least those I am looking at)
told me that yesterday "should" be the bottom, the reality is that it only
"could" be a bottom. And would DJIA collapse about 600 point (it could
happen today very easy) the same indicators would say that "the bottom is
in" much more loader.
As of feeling in your stomach, well did some one had the stomach ache for 3
days in the row? That all it took to complete 1987 crash.
The bottom line. I am the greatest picker of the tops in bottoms and the
reader of technical indicators ever walked the Earth. But only on the
charts. And, indeed, how can any one looking at the chart today miss the
top on August 25, 1987? Or a bottom yesterday (if we close up today)?
Yours, Alex.
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