Great opportunity coming up

[Sean K]

Perhaps a once in a life time opportunity to catch the bottom of this bear market coming up imo. If this break lower follows through, I think we're headed to around 27-2800, and at that point I will be directing all cash into the market, and then topping up on weakness with the banks money.

I've mentioned my model portfolio before which are the stocks I'll first be attacking, but then look at anything else that seems to have been more seriously oversold, but is solid and will survive.

Once in a life time opportunity. Sell kidney for this one. Maybe a Grandma too.

 

[MR.]

Kennas, some posters have written in ASF of their gut instinct. With this instinct they perhaps have done better than others as the markets fell to current levels. However these instincts do not appear as clear as six months ago.

Maybe "a once in a life time opportunity" I don't know why but what's left of my gut instinct does not agree. Perhaps not good when one fills their mind with all this doom and gloom....

Why will the market be good value at 27-2800? Is it just because of the recent fall?

I read posts stating it's within 15% now so why not just buy now..... or perhaps a nice trade is on it's way!

Still remember you predicting a top at 1.80 for GBG ten months ago when the run began at $0.73. Either those charts work with volumes etc. or you had/have many followers? Whatever it amazed me! Because I thought it was well overpriced.

27-2800 must be a level where you think the market is over sold. I have waited a long time for this and what's left of my instinct tells me more like 18-2000 is the mark.

For starters house price falls and job loses are yet to be realized on the ground. And people continue to highly leverage themselves buying back/into stocks. eg: like one of those Storm clients who just had a go at all ASF members!
I don't get these people. Perhaps it's just go hard or go home.... if you have one left.

As you may have read I put 40% into a 3 year term. Perhaps I should have chosen 2 years but no less. But I am not a trader.

 

[Sean K]

The 27-2800 mark is a key support level that I think has a big chance of holding. It may go lower but I'm not sure. EW is saying this is probably leg 5 of 5 and some EW theory and fib numbers extend the W5 lower, but with all that horizontal support around 27-2800 I just think it will be hard to beat. If W5 ends about then, then there should be a very significant bounce if the theory is correct. Disregarding EW there is also a large pile of cash sitting on the sidelines, like mine, waiting to be invested. Once people start thinking there could be a bottom in place they'll start chasing the market up, and it could really be chased up. People won't want to miss the bottom. I'm thinking at least a 50% bounce, possibly 100%, before sideways movement for a while.

 

[MR.]

Kennas, agree with that pile of cash waiting to be invested and not much good at the going interest rates either. Not sure if "Nuns" comments are due to him shorting the market but I agree "no rush to get back in." Now for a trade on the bounce you suggest could be worth looking at.

 

[MRC & Co]

Personally, do put all money back in at those levels and then borrow to average down if it falls further, is way too risky I believe.

At 2800, you only need 280 more ticks and you've already lost 10% of your entire portfolio.

This will be a depression in my view, the US is living on borrowed debt, and so far, they have done absolutely nothing about that. Eventually, there will come a point, where they have to ride it out.

Until that point, probably years away, I think dumping all your cash (and on margin) is too risky.

It's times for trading, not taking long-term positions.

But hey, I may be wrong, GL Kennas. Just be careful, don't forget some basic rules of trading, with a pot of gold of what could be sitting in your eyes.

 

[Sean K]

Yes, I agree, risky. Like crossing the street. he he. I won't get myself into too much trouble. I hope. I agree potential for depression, end of the world etc, but I'm going to take a punt that a depression resolves itself and the next leg down may be the bottom, like there always has been bottoms and tops, and there will be a recovery. Eventually. If there is no recovery, then we're all in deep do do, and nothing matters too much anyway. I'll just be sitting on my beach in Mexico swimming with the fishies wondering what comes next.

Going to be an interesting couple of years, as the last couple have been.

 

[MR.]

In March 2003 the bottom was approx 27-2800! Hmmm

The actual low was March 13 (good date "13")
and the figure got to as low as 2666 ("666")

 

[Sean K]

oooooo, scarey!

Also, 2800 lines up with lows in 99 and 01, and highs in 98. All around abouts, hence the range 27-2800.

Things are looking pretty dire right now.

 

[MRC & Co]

Yeh, would just hate to see you have to go back to real work Kennas! ha ha, protect that pot of gold you already have as best you can!

 

[Sean K]

With the recent price action I'm wondering whether we've seen the low for this phase of the bear and this is the start of the bounce I'm anticipating, or whether there's another leg down to the 27-2800 mark?

Don't want to miss this, been waiting for 12 months...

I'm also wondering whether hitting the 'absolute low' is necessary, when I think there's going to be a 50-100% bounce?

Why not just buy all the stocks I have in mind to make the big short term gains now?

 

[nomore4s]

Kennas I think we're pretty close to a bottom but we may get one more good leg down, then we will probably trade sideways for a number of years but I think this range will be above the ultimate low. I think the low will be made while there is still some fear in the market - especially in the media and general public.

I have been slowly buying stocks for my income portfolio for the last few months but have only been buying 1/2 size positions and have about 50% of my capital for that portfolio in the market now. Will inject the next 50% if we see a next leg down.
I'm not really interested in picking an exact bottom as that is near impossible just worried about managing my risk atm.
Most of the stocks I'm interested in have probably put in close to their lows anyway - take BHP as an example, if we do get another leg down it is very possible BHP will only go down to test its lows at $20 or not even get that far down. Alot of the stronger stocks are forming solid basing patterns.

 

[MRC & Co]

Personally, I think buying on the low when Nyden first posted his post about all the news negativity being at all-time records and the GS stats about how the markets had fallen 20% in 17 days was the perfect time to buy. Waiting for confirmation is tough unless your planning to ride a longer-term trend, which I doubt we will see for some time (perhaps a few years).

At this point, back on the 8th-9th, by news sentiment and current market activity, it looked as though all those who wanted to be short, were short and all those wishing to covering their longs, had done so.

I would be careful about looking for this as a bottom, IMHO, it's just a dead cat bounce, squeeze the shorts, clean them out and get all those looking for a bottom back in, before it's given another beating.

That's how I see it anyways.

Cheers

 

[MR.]

Needed a bounce so to make lower lows. No doubt most buying will be setting tight stops!

By the way that 666 I am not supersticious even one little bit. That said, I see the current bottom a few days ago on the S&P was again that 666. that calls for a ooooooo

 

[MRC & Co]

I wouldn't say we needed a bounce, we could have easily just dropped out of that range further and through to 2800.

However, the important part is, the bearish sentiment was EXTREME and the falls seen in the US were dramatic.

We all know, when most are short and most longs have covered (longs covered = out of the market), then who is left to sell? Path of least resistance is up, and we all know the market ebbs and flows, with huge falls in the US and negative sentiment, we have a case where two specific requirements are satisfied: 1) The market will have to move back to form a lower high, and; 2) those short are ready to be squeezed and you won't have much more covering longs left to be done (already seen with the negative sentiment). PERFECT time to buy, ONLY IF, your looking for shorter-term trades. If your waiting for a longer term trend to be established, then you won't want to try cand catch a falling knife, you will want confirmation, but with it highly improbable we will make a clear uptrend from here, it is not a smart trading strategy IMVHO.

Just one opinion. Bit of a rant, and repeat, but trying to thump home how I see it encase anyone is confused.

 

[Sean K]

Broken back through 3300.
Didn't think that would happen so easily.
Up 10% already from low.
US powering today.
Looks like we might even be back through 3400 very soon.
I'm 70% cash still.

 

[nomore4s]

Don't worry Kennas, if are to get a very very good rally there will be higher swing low (higher low) at some point.

 

[shag]

i bloody wonder if bhp can hold above 32 this time
that bond issue at rates hugely beter than rio's, and rio's chineese move looking less likely might just do it.
but the imf report aint lookin good.
u still bored sean, then why not try a blog.....one like yr top picks should we get a damn flash bear rally.
i need one as i saw a good lookin boat just down the road.
might just use the five finger discount method and relocate it to the back of my place.....

 

[MRC & Co]

Yeh, I don't have any strong conviction at the moment, because we aren't at any obvious extreme, but I tend to think what nomore stated may play out, this being a higher low and then we get a run to around the 3800 level before coming back through the lows.

 

[Sean K]

LOL, DOW up nearly 7%.

Nice bear rally.

Where's that bloody swing low?



Patience grasshopper.....

 

[MR.]

She's already sailed.... yes..... but that rudder's still not fixed! That's worse than being blind! Can she make it out the bay through the heads?

Too many Buffets....... Just buy when the shares are low the governments will sort it all out. "Have no fear" We might as well just leverage on leverage while we're at it!