There has been many predictions for almost a year by so-called gurus that S&P 500 should be @ 1010 or 999 or even below 666........
Greece is troubled for months, US economy on the verge of recession , Europe economy is a basket case & China is slipping.....
Europe slumped by 17% +, Dow 12%+, Nasdaq 13%+, S&P 500 14%+..all dropped on FEAR of economic slump worldwide.....
SO..why we are @ 1131.42 ?
Despite all of the above mess, we have not even tested 1100 support.......
FEAR is higher than Aug 8th low ?
VIX @ 42.09 is highest monthly close since March 2009....
Friday volume was LOWER in Nasdaq ?
Dow theory is also NOT confirming a bear market ?
CMF in S&P 500 is barely negative ?
MAYBE.....things are NOT as bad as being projected in media or by fear mongerer....
China PMI on Saturday came in better than feared on Friday, 51.02 which was better by .3 from previous month..a back to back 2 month gain...HSBC caused a panic selling on Friday worldwide by forecasting 49.9% PMI for China...HSBC prediction was wrong by a wide margin..
Is worldwide growth in 2012 really that weak?
China is expected to grow its GDP in 2012 by 8%
India is expected to grow its GDP in 2012 by 6%
US should grow its GDP in 2012 by almost 2%
Canada should grow its GDP in 2012 by almost 3%
These biggest economy is more than healthy for next year.....
I do not know about you, but i do not see recession in 2012 @ all
Markets generally OVERSHOOTS on the downside also...
HFT & its supercomputers / black box are in total control these days as retail takes a back seat by fear.....
Many strong stocks like AMZN, AAPL are holding up pretty good......
Many stocks are taken to a level where PE is @ 1, 2, 3, 4,5...which is unheard of in a growth environment......
YES..EU & ECB is in the process of resolving bailout issues, its in the end game stage...so more than necessary have been discounted in indices worldwide.
YES..i had to reduce my exposure from 100%+ on Thursday AM, as i felt that downdraft is IMMINENT in all indices...Thursday & Friday was brutal in markets...which saved me serious $...
I feel now, that market has discounted more than necessary & has held key support level.
We may have seen the worst of selling already......
It IS time, to slowly get back in this market in good quality stocks.
In selection process look @ fundamental picture of each stock in terms of 2012 PE.
Good luck with your OWN analysis & comfort level.
BLOG does NOT give buy or sell.
Saleem
16 comments:
Hey Saleem,
Great commentary although I don't share your outlook. The rebound activity in September after the August decline I feel is now gone and I believe the bearish mood is about to entrench further.
I think many relatively positive things will happen in this month including Q3 GDP > 1.5%, good earnings reports, AAPL iPhone release, and potentially a good jobs report. I think all of these are now backward-looking, and I'm looking to establish some short NASDAQ exposure after pops and may select specific stocks that do preannounce for short-covering bounces.
I believe the market is about to enter an even more difficult time. Everyone should stay only with exposure that is extremely comfortable.
Good luck everyone!
Stocktrader
Hi Stocktrader,
We all have our own point of view all the time & execute accordingly.
Market does surprise all point of view quite frequently.....
Good luck with your strategy.
Saleem
SALEEM
I am so glad to see a positive VIBE
It is OH so negative.
While I do not disagree with Stocktrader--he poses interesting and conflicting theory to my beliefs
IMHO if Greece and Europe do not get resolved then we are headed for more down swings
But I am optimistic--I things will get better soon
Just my .02 cents
Hi C,
It is NOT about agreeing or disagreeing with anyone..it IS about persuing our OWN belief..whether bull or bear...that is what makes a market.
Saleem
Hey Saleem,
You are absolutely right. You form a thesis and act on it. If it is not working, you re-evaluate and start again. It is our ability to adapt that makes us able to profit even in volatile times.
Ultimately, the strength of the dollar is going to be a main source of weak earnings going forward. The stronger the dollar gets, the worse multi-national profits will be even if unit volumes remain constant, which I don't think can remain either, so this therefore supports my bearish thesis.
Anyone reading this blog is nimble enough to make money long or short given there is likely to be enough volatility to enable this. I just have a base thesis from which to work so I am not surprised by developments.
Stocktrader
Hi Stocktrader,
First ..understanding current TAPE is important....
Second...Focus on money making ideas
Third....Adapt to new reality..
Market is evolving every second..good to be ahead of the curve...
Saleem
I saw a lot of broken charts and it said we are going lower but the bright side is that we are oversold. and market should bounce. With all this years watching the market, i learned that oversold market could be more oversold. I think day trade is the best bet at this moment
Hi Up,
Daytrade is great IF you get the "timing & direction right"
Market is too volatile for everybody..long / short / daytraders.....
Hard to make money .no matter what you do ?
Saleen
Hi Saleem,
This market is very danger for both side of play, that is why patient is the key, I don't force anything and keep position small, so even if i get burn, damage will be limited
Saleem,
It is a tough market for everyone. However, I think US market behaves a lot better than others: Asia, Europe... I reduced exposure to 35% but not completely out of market. I think it starts to build a base from here and going up when everyone think it would go other way.
Michael
Hi all,
It is better for us to break through 1100 on Sp500 with huge volume to get rid of weak hands before we go back up
Hi Up & Michael,
Market is never easy except in EUPHORIC times which is once every 3 years......
Reducing exposure to 35% is a wise strategy.
I am hardly out of market completely..so my 24.4% exposure is OK for now.....no need to rush & buy until there is more clarity.
I expected US to do better today...
Saleem
Hi all,
We are at major support level, i think we will be bouncing from here, it will take few time before they could break to the downside
Hello all
I got a bad felling abort the market direction
That said we may close very positive
best to all
C
Saleem,
BIDU behaves well today. I think it is trying to build a base. Will it go up from here or continue down with the market?
Michael
Michael,
BIDU finally has found support.
It is a BUY.
Saleem
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