Thread: Bullitt's Account Talk

Another unreasonable day on the emotional rollercoaster of earnings season. Major technical move to the downside today and it doesn't look good from here on the charts. Actually, it's a technical nightmare. I'm just hoping we don't get a major move up until I DCA more into my allocation next week. The market always seems to have an up day when my TSP gets DCA'd.

Anyway, we were 'overbought' and needed some kind of move back to reality. The breakout day on the 12th has turned into more harm than good as today proved it to be a failure. All of those people who jumped on the bandwagon and bought while the market was taking off are selling today because they walked into an instant loss. Here's the news... Those stocks people were buying a week and a half ago probably have the same financials and earnings projections today. Emotional based buying and selling is a heartbreaker. Failed moves up bring fast moves down.

Since TSP is such a long term vehicle I'm more than happy to DCA at a lower price. Besides, quarterly earnings calls are not a very good gauge of the big picture. Earnings calls are all subject to interpretation because forward guidance and beating estimates doesn't guarantee a move up. I'm hoping we can stay down in order for me to add more shares and better yet, for this bull to regain it's upward momentum.

If the Dow were to drop 5% tomorrow, we'd still be sitting above 13K and more importantly, above the 200 DMA. 5% couldn't even shatter two important psychological technical indicators! In other words, it's going to take more than a 2% day to phase this bull and any drop is a buying opportunity. The big money has been flowing back into the big companies that America was founded on, and it's not until recently that the retail investor realized this. In our case, the fund with the necessary exposure to this Bull market is the C Fund. What a buying opp that would be if we dropped 5%....

I'm still hanging out with a 100% stock allocation. It's gonna take more than this to shake me off this ride. No need for stops because they just don't work when it comes to the TSP. Besides, It's looking even better today than yesterday another load will be DCA'd in at a good price next time around.

Today is the perfect reason why you need to ride it out in a 401K. It seems like a much changed sentiment today than what we had after 7/12/07's euphoric debacle. Sell the strength, forget the fear. Like I said in an earlier post. The market could get blasted even harder and we'll still be sitting above 13K.

Those who lost today, realize that nobody on this site lost as much as Brian Hunter's clients when he worked at Amaranth. Could you imagine getting that quarterly statement saying your account lost 98%? We're only down like 5% or so...

Yes- or this could be something we are not acustomed to. The bottom line comes down to what amount of pain can anyone investor sustain. It's a different level for each of us. It's all relative to where you are in your career vs. accepted risk.

Geaux

Originally Posted by Geaux4it

It's all relative to where you are in your career vs. accepted risk.

I think time is the biggest factor in a 401K. Fortunately, my situation still has plenty of time to ride out even the perfect storm.

I spent this weekend on the beach and I couldn't help but laugh over some of the talk I overheard while enjoying the sun. Comments such as, "did you see that market this week?', 'The market took a dump, we're heading for a recession,' and 'I'm going to put all my money into bonds this week." To me, this is good news that these people think this because they represent the dumb money. (Of course, I'm considered dumb money as well since I'm not a millionaire investor, but I like to think I have somewhat of a clue out there.)

Dumb money is always late to the party and famous for buying tops and selling bottoms. Tom referred to these people as Joe Sixpack in his market comments. I know there are some guys on this board from the sands of Hawaii, so correct me if I'm wrong but any beach bum talking the market is just a Poser.

Q How do you buy when you're already invested in the market?
A Start selling some of those overpriced emerging market stocks in the I fund and start buying into the underpriced big stocks in the C fund.

I don't see any signs of a bottom here according to every technical signal, but that's good. It's better for this correction to happen now than later. That huge selloff wasn't the retail investor on Friday. That was the work of hedge funds. The retail investors are for the most part, washed out of this market and dying to get back in. Proof of this in the steady increase in NYSE Odd Lot sales and shorts this week. Odd lot shorts in particular rose by about 1Mill-3Mill every day but one last week. Those 10.1 million odd-lot shorts on Friday are going to get their doors blown off when we recover.

We're going to see more selloff in the days ahead by the hedgies in order to get rid of even more weak holders. Everyone has been calling for a correction for a long while now and forces that move the market have finally decided to make it happen.

Some people choose to ride a motor bike on these hills. I'd rather chase team Cinzano on my Madone and be riding with them when we're Breaking Away.

I heard a couple of guys at a little league game talking about the market this weekend. They were both concerned but agreed that the market should rebound quickly. Viewing that as a contrary indicator, I was disappointed since I am now 100% in the S fund.

I know not everyone is going to be wrong. Maybe these guys were actually the smart money?

The talking heads on CNBC don't seem to think its over and most say it will be mid September before the market goes anywhere. Thats also a contrarian indicator.

Originally Posted by clester

The talking heads on CNBC don't seem to think its over and most say it will be mid September before the market goes anywhere. Thats also a contrarian indicator.

sh*t... ALL IN!!!

Been busy and unable to post but here we go...

Yesterday was an important day. High volume up day that shook out even more weak hands and sucked in more short sellers. Odd lot shorts continue to rise, and that only means they will get burned in the days ahead. I haven't budged from my current bullish stance and I'm ready to head on upward again. Good action in OBV past few days indicates that the big money is flowing back into stocks. I have a feeling this dip/drop/correction is the culprit of a few more hedge funds that will be going under. Nobody knows what these guys invest in and they surely have the power to move markets. Bottom line is that the retail investor continues to sell off at HUGE losses while the Mutual Funds are buying at a discount. Why sell on a drop off when companies are issuing great forward guidance? At least I got a good DCA this week.

I saw a list of some 50 lenders that are going kaput from the subprime mess and seriously folks, I've only heard of 4 or 5 of them. Let em crash. This is a great time to clear out the dead wood, fly by nights and weak hands so we can get on with things.

Yesterday was day one of the rally, confirmed with the volume. Give it 4 or 5 more up days and then the 'IBD Follow Thru Day' and we're off to the races. BTW, did a 'mon back' (Cramer term) on C at the 47 level this past week. C has some of the biggest money inflows of the dow components this past month. C has too big of an exposure to the world financial market to be affected by this subprime. With a 4.5% yield and increased forward guidance, I'm a buyer at these levels.

Good luck longs. Bullitt.

Amen, Brother. Amen.