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Dear Jeff97_98_1998,
I do not recommend anything. I only post what
I observe from my charts.
If the 2.5 year bear is to continue for the
projected time-frame (to 2014), then absent an implosion of the World economy by
reason of a cataclysmic event, it would seem that we may be in for
a trading rather than trending market during that period, and the market
may be expected to continue to bounce between the extended upper and lower
bounds of the existing 2.5 year trend channel (as may redefined upwards and
downwards with the passage of time).
Assuming that to be true, it would follow that
shorter term traders rather than longer term investors will come out on top for
the duration.
I note that a year or so ago Warren Buffett was of
the opinion that the market would not resume its upward trend for several years
(I recollect he put the end of the bear at 2009 +/-).
I try not to compromise my rudimentary technical
understanding of the market with my even less knowledgeable understanding of
fundamental analysis. Nevertheless, my
understanding of the fundamentals includes the following:
Up here in Canada, the economy is roaring ahead,
powered by export sales which are enhanced by the relative value of the
CDN$/US$. Down below the 49th parallel in the USA, the economy seems to be
recovering almost as handsomely.
The economic data in America (and to a significant
degree in Canada as well) has been driven mostly by consumer spending with the
consequent effect of new highs in consumer debt. At some point the
creditors of the consumers will demand repayment. As and when the
creditors do so, will the consumer debtors be able to meet their demands?
Time will tell if they can, and the consequences if they can't.
While interest rates are low and may justify high
P/E ratios, those ratios are above average historic levels justifying investment
and earnings are currently subject to downward restatement as a result of
the restatement of many corporate accounts following the debacle of Enron and
WorldCom.
FWIW. I remind
you I am not licensed to say these things for profit.
Tony Pylypuk
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----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
<A title=jprroth@xxxxxxxxxxx
href="mailto:jprroth@xxxxxxxxxxx";>jeff97_98_1998
To: <A title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Sent: Monday, July 08, 2002 9:11 PM
Subject: [RT] Re: DJIA
<FONT face=Arial
size=2>bear market till 2014.So do you recommend
shorting the sp, dow , nas ?short and hold for 12 years. Now that's an
idea.wonder what my draw down would be?any thoughts on stop
loss placement?--- In <A
href="mailto:realtraders@x";>realtraders@x..., "Tony Pylypuk" <<A
href="mailto:tpylypuk@x";>tpylypuk@x...> wrote:> Attached are
three charts of the Dow Jones Industrial Average.> > Figure 4
(indu-02-07-08(4).gif) is the picture from late 1976 to the
present.> > Figure 5 (indu-02-07-08(5).gif) is the picture from
1999 +/- to the present.> > Figure 6 (indu-02-07-08(6).gif)
is the present.> > What they show, especially Figure 6, is that
since mid-June, 2002, when INDU penetrated its 20 year support trend line
as defined by the intraday lows of July 8, 1982 and November 23, 1994, for
the first time since it was first penetrated during the aftermath of
September 11, 2001, INDU has been trading between the bounds of that
support trend line (now acting as resistance) and an alternate support
trend line drawn through the intraday lows of July 8, 1982, and September
21, 2001.> > If the alternate support trend line is broken
(and I would note that it remains inviolate even intraday), the next
support is in the vicinity of 8641 (a 38.2% retracement of the expansion
from November, 1994) and 8350 which represents the extended bottom of the
2.5 year bear channel (excluding the downside violation of that channel
following September 11, 2001).> > As previously noted, one
of my Fibonacci studies suggests a bear market to 2014 (or to an
equivalent price point in time - with thanks to Earl Adamy who in a recent
post cogently observed that bear markets can take on one of (at least) two
personalities - they may fall precipitously as in 1929 and 1987 or they
may meander downwards and upwards without new significant highs and mostly
sideways for an extended period of time).> > FWIW.>
> As always, I remind you I am not licensed to say these things for
profit.> > Tony PylypukTo unsubscribe
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