Indices have been correcting for four weeks, CMF level is very close to June 2012 lows.
We all know what happened after June lows, it started the-biggest rally of 2012.
Currently, pessimism is @ highest level since June.
Euphoria & pessimism are my two biggest indicator, which i have highlighted repeatedly.
As you all recall, i was extremely bearish about five weeks ago when markets were heading towards highs.
Now that indices have been trending lower, i have been increasingly OPTIMISTIC.
We all have to recognize extremes in markets to get "high velocity" from our invested $$$.
How do i know about pessimism, it has been reported that listening audience are @ "lowest levels since inception of many programs on CNBC"...among lowest rated "Fast Money", "Squawk Box" & "Closing Bell"...This is very interesting, either retail is giving up on stock market or retail knows better NOT to listen to CNBC......
There is evidence also that investors are giving up on stocks, as Fidelity is reporting for the "first time" there is more money in "money market & bonds than stocks"......
S&P 500 have corrected 3.44% in a slow drip, drip mode.......
Many high fliers are below 50 DMA like AAPL,AMZN,PCLN....which generally indicates oversold conditions......
SO..it is an OK strategy to step back in this market, many important earnings report should give a boost to the market & confidence level...GOOG,ISRG,EBAY reporting this week, & it should be a beat.
Do not be surprised, IF we are higher by end of this week.
Good luck with your own views of any & everything which could go wrong, but @ some stage it is all discounted & in the market.
BLOG does NOT give buy or sell.
Saleem
2 comments:
Saleem,
I pulled out of the market to work on other thing. Even though, I was off, I still read your blog and comments from Stocktrader, C, and others. Your recap and analysis of individual stocks as well as market direction were always excellent for blog readers to follow. As your blog reader, I have appreciated for what you have been done to help others.
Today, I was starting on a position in AAPL at 625.25. I consider AAPL as a safe trading stock. I am looking at APKT, SNDK, LVS, VMW, CLF and BIDU.
Michael
Hi Michael,
Nice to see your note.
I appreciate all the visitors to my BLOG. Most visitors are "read only"....
It is quite satisfying to know that i have a "worldwide audience" as google tracks every visitors origin for me....my second biggest audience is from Russia.
Good luck with your re-entry & with AAPL..most on your watch list are good stocks.
Saleem
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