(correcting myself) ... the curve that was trending upwards is actually the S&P. Proof positive that I haven't been paying good enough attention in Corporate Finance class: dividend yields have actually fallen significantly for the better part of the last two decades, but have been increasing somewhat since 2000. I can't say I can give a good opinion on what effect the proliferation of easy credit could have had on that trend, though.
Psshhh... I know exactly what's happening... but I'm not telling you. Honestly I think a lot of technical indicators triggered and people started getting into positions (whether automated or manually). That's what caused the market to bounce like this. I don't know what else could explain it. Some of these stocks that are going up make no sense going up all at once.
Perhaps some <i>Momentum Investors</i> that had resting orders. If they use Stops, then it might work. Otherwise there is the potential of getting hurt if/when things sell off again.
lol lord knows i don't. this market is insane. look at the moves in stocks like PG and JNJ today....just freakin crazy. i could go on and on but there is just so much stuff. then you have the buyout of HPC which never even got to the buyout price but was completed today....i have NEVER seen that before. this market is completely jacked up.
Add me into the group of people that don't know what's going on. People I know in brokerages/hedge funds say the market is pretty much impossible to figure out lately. The only people who have some idea of what's going on are probably a select few, who understand exactly how their systems work and are part of those hedge funds that run huge % of the volumes traded every day. JeopardE, when I see that chart of the Dow with the loose technical indicator of a bottom, I can't help but laugh. I could draw up 100 different single indicator charts with different projections pointing to different bottoms. If it was a single stock on a shorter time frame, I could see it having some value - but projecting the Dow is an entirely different beast with thousands of stocks, trillions traded, currency and inflationary rates, cultural changes and unnameable plethora of factors. When I say I'm waiting for below 7500, it's simply because the first dip hit 8k, and I believe things are worse than what people knew back then. Projecting with PEs makes a little more sense, because it is still the main statistic value investors use and that type of "definitely cheap enough to get in" is what will pull us out of a bottom...
Just to make myself clear on that point again -- I'm not saying that 8k is *the* bottom and we can only go up from here. What I'm saying is that that support level is too significant for the market to break through it on a single wave down without so much as a retracement that would be noticeable on that chart. In other words, we have to see a significant (meaning for a few months at least) rally bounce before we can come back, test that low and perhaps breach it. Another thing is a lot of Elliot wave theorists have been trying to figure out what wave count we were in, and if you look at that long-view chart, it appears that we did in fact complete wave 5 on the swing down to 8k. Perhaps that's just the sub-count for a major corrective wave and there's more to come. I'm not an Elliot expert by any means but it's worth considering.
I have a feeling the market will go up tomorrow, and next week will probably be another roller coaster..
I guess the idea of dumping some hundreds into microsoft, starbucks, altria, mcdonalds with some other blue chips coming back 5 years later with 15% gain is far from certain these days?
Btw, when I started trading only about a couple years ago, I started with a virtual portfolio and then started trading real money and hit a couple doubles and many 30%+ gainers right off the bat. I thought I was a genius for a while and had reasons for why everything was happening. But the truth was when I started looking back and looking closer, nothing I said was a solid enough of an indicator. My friend in a boutique hedge fund told me four things. - never trade emotionally - trade always looking at the current situation - shoulda, woulda, coulda hindsight talk is useless unless for analysis - stop needing to find a reason for everything On the last one, he wasn't telling me to stop finding indicators; more so that I kept needing a reason for moves in the market and that I started believing things I was telling myself that weren't strong enough indicators or real patterns in the first place. Since then I've become a lot more patient and use a much larger spectrum range of signs before making moves and my gains have been a lot more consistent and solid.
This is a really irritating market. Saw the market was relatively even keel midday, went to rebalance retirement accounts more into stocks, than wham, up 500+ (after my orders are in). Not a big deal in the long run, but irritating. People just need to chill.
friggin' lunch. if i had been at my computer at noon, i could've seen MSFT at 18.xx and DIG down around 25. and i would've actually bought some more. but noooo, the human body has to require caloric intake to survive and i missed it and came back to work after it was already up about 100 and i didn't want to buy at that point. but i guess i'll still take a 500 up day.
lol. No kidding. Something like an 800-900 point intraday move. My AAPL I accidentally bought ended up being the best trade - up something like $7 on it. I went from being up 7-8% on DXD/SDS to being down something like 8-10% when I sold. Talk about the agony of defeat.
these 10% up and 10% down moves are becoming so commonplace (especially on the ultra's) i sometimes have to catch myself when thinking about what to do. i'll buy something at 30 and 2 days later it'll be at 33 and i'm sitting there thinking "well, i'd really like to wait and see it hit 35 or 40" before i realize, "you're up 10% in 2 days! a whole year's worth of gains in 2 days! take the money you idiot!". luckily i've been doing a fairly good job of taking the money the last month and not being greedy.
<i>Repost</i> FBB There is an interesting dichotomy (perhaps more than one) at work in this thread. Group A * Researcher * Grinder * Cautious * Nitpicker * Detail Oriented * Staid * Structured Group B * Flamboyant * Gunslinger * Off the Cuff * Impertinent * Free Flowing * Unpredictable * Bold If the BBS members were asked to nominate people for Group A, I would stand a fair chance of making the Top Five. If the BBS members were asked to nominate people for Group B, you would stand a fair chance of making the Top Five. Yet, in this particular thread, we are in opposing camps. The Annuities area that you are endorsing might normally be associated with people in Group A. The shorter term trading that I have been doing lately might normally be associated with people in Group B. Your contention that it is akin to Gambling is interesting considering that I devote quite a bit of time to reading and thinking about the markets. If I felt it was strictly Gambling. then I wouldn't be doing it.
Ah, the disgruntled, grumpy Annuity Man makes his cameo appearance. Of course it's gambling! It's an account I play with apart from my retirement accounts, which I've said several times. Did someone steal your cookies or something? lol. Every "strategy" anyone's posted in here is gambling. Investing in stocks is gambling. If it isn't, give me the stock you own that isn't gambling. BTW, these companies may think annuities are gambling pretty soon : http://money.cnn.com/news/newsfeeds/articles/djf500/200811111129DOWJONESDJONLINE000391_FORTUNE5.htm
Mango, I remember reading your post the first time. I technically put myself in both camps. In my retirement accounts, I am essentially Group A owning and DCA'ing into stocks such as KO, MCD, BRK.B, GE, MSFT, JNJ, WMT, mutual funds, etc. at various points. Short-term, I don't care much what happens in this account. I look for bluechip stocks with global reach that aren't necessarily completely tied to one nation's growth. I may take some profits after a market swing to put to use in the future, but for the most part these positions stay constant or increase/shift around. I will not own stocks such as POT, FCX, crazy ETF's like SDS, etc. in this account. I have a Group B account where I just like winging it with money I consider to be discretionary. I am approximately 60-70% cash in this account at the moment and have been about 80-100% cash through most of the past 2 or 3 weeks. This is the account where I take risks. It is the only account I will trade options in. This is the account where I gamble. There is no strategy... none... where you do not gamble. Even for Group A's, long term buy and hold is a gamble. If you don't believe it, ask people that started buying and holding stocks in the mid-to-late 90's. There is no stock trading strategy that is 100% correct all the time, and since you cannot predict market movement with 100% reliability, you cannot predict with 100% reliability when your strategy will begin failing, thereby saving you from losses. Strategies only exist to increase your probability of a "winning trade" (if you truly believe that).
anything can be gambling if you want it to be...it's just a matter of the way you approach the situation. remember risk doesn't always equate to gamble.
Dr of Dunk I have thought about the usage of the word <i>Gambling</i>. You have probably heard of <i>Card Counters</i> that developed the ability to swing the odds into their favor when playing Blackjack. They weren't able to win everytime, but often enough that they were able to beat the <i>House</i> in the long run until <i>countermeasures</i> were developed and implemented. I don't expect to win on every trade, but often enough that the odds are now in my favor. From my POV, <i>gambling</i> would be a situation in which I had no chance of impacting the outcome. At this point in time, I am able to impact the outcome often enough that I know longer view it as <i>gambling.</i> Minimize losses on the losing trades and the winners will take care of themselves. I still tend to closeout my winners too soon because of a past experience. I stayed too long with energy stocks this past summer and gave back more of my gains than I liked. The memory still lingers and I now usually keep hitting <i>Singles</i> and not try too often for <i>extra bases</i>. I might loosen up as this progresses and try for <i>extra bases</i> more often, but not yet. As long as the market <i>range trades</i>, then I am quite happy because what I like to do works best in that situation. Eventually, I will need to develop other methods -- plans and I am working on that as my knowledge increases. Some people like FBB will say that I am still <i>gambling</i>, but it is just their POV. In regards to the article you posted about annuities and the investments backing -- supporting them, I had been waiting for FBB to stick around this thread long enough so we could get into a discussion about that topic. Since he seems to favor a <i>Driveby</i> posting style, it appears doubtful that the discussion will develop fully.
So far the best "Keep It Simple Stupid" Elliot Wave chart I've seen. This is a monthly chart of the S&P 500, and lends credence to the idea that wave 5 of 5 completed at 825 (Dow 8k). We *will* see a big rally, and I intend on riding it to the very top. The rally will likely end at $SPX 1100, and then, if this wave count holds, the bears can finally get their desire (SPX 700/Dow 7300). And if/when that crash happens, it should be the buying opportunity of the century.
