|
PureBytes Links
Trading Reference Links
|
Bearish is relative to both time frame and risk tolerance. Under my investor
hat, I am loath to bet the farm on a market which is so highly valued
relative to some 60 years of the price/earnings/rate history which I
maintain. I have been out of US markets for some time - does not mean it
will not get even more overvalued. Under my trader hat, my work is telling
me that this rally has about run out of steam and there is decent chance to
trade the market down to 1100 area. If the market gets there and tells me
it's going lower, or if the market doesn't get there and tells me it's going
higher, so be it.
On a technical basis, I don't believe that we have corrected the rally from
the 1994 lows (it would take a 38% correction of the rally to satisfy that
criteria for me), the interest rate trend from 1982 has changed, and I can't
do TA on Y2K. More important to my work, my intermediate and long term
breadth models did not confirm the last rally and are negative.
Earl
----- Original Message -----
From: <GREHERT@xxxxxxx>
To: <realtraders@xxxxxxxxxxxx>
Sent: Wednesday, August 18, 1999 5:02 AM
Subject: Why is everyone so bearish?
> I can't understand why everybody is so bearish. The two main reasons
cited
> by most experts are rising interest rates and the Y2K uncertainties (and
lets
> not forget inflation). Well as I see it, interest rates have just dropped
> more than 25 basis points; Y2K will probably be a big thud, and Greenspan
> will keep inflation in check with pre-announced rate hikes.
>
> Technically, we're not due for a 20% S&P correction. Remember we get a
bear
> market every 4 years. That would be 1990, 1994(stealth-bear), and 1998.
> Next one's due in 2002. Two 20% corrections 12 months apart would be
> unprecedented.
>
> I would guess that we have another 1994 zig-zaggy type summer with
probably a
> test of the lows and as soon as Y2K passes, an explosion torr the upside.
> Your thoughts?
>
> Jerry Rehert
|