Likes Likes:  0
Page 1 of 3 123 LastLast
Results 1 to 12 of 35

Thread: Is a bounce too obvious?

  1. #1

    Default Is a bounce too obvious?

    I am looking for a little oversold, options expiration, overly bearish rebound. This play actually looks so obvious that it may be a trap.

    The early survey results today are 23% bulls, 61% bears.
    There is a large gap up near 825 (Currently 789).
    The break of the wedge is at the same spot (825) and a rally back to the old wedge support line is very possible, but it should act as resistance.

    The problem is, I am hearing a lot of talk of this bounce, and that makes me a little nervous. It could become a self-fulfilling prophesy, or it could be a "do the opposite". The herd appear too bearish and that is a good sign and could be the tie-breaker.


  2.  
  3. #2

    Default Re: Is a bounce too obvious?

    Quote Originally Posted by tsptalk View Post
    I am looking for a little oversold, options expiration, overly bearish rebound. This play actually looks so obvious that it may be a trap.

    The early survey results today are 23% bulls, 61% bears.
    There is a large gap up near 825 (Currently 789).
    The break of the wedge is at the same spot (825) and a rally back to the old wedge support line is very possible, but it should act as resistance.

    The problem is, I am hearing a lot of talk of this bounce, and that makes me a little nervous. It could become a self-fulfilling prophesy, or it could be a "do the opposite". The herd appear too bearish and that is a good sign and could be the tie-breaker.
    I agree Tom.

    The PPT might have screwed this up, although the day is not over. I wanted to see a big down day to suck in the shorts for a crash play. I wanted to buy in today, but I'm not sure now. Although, the I fund would be a great play if the PPT fails and we get a big sell off this afternoon.

  4.  
  5. #3

    Default Re: Is a bounce too obvious?

    Bonds not confirming this selling. Is the weakness in bonds today (higher yields) another sign of a possible rally in stocks next week?

  6.  
  7. #4

    Default Re: Is a bounce too obvious?

    Quote Originally Posted by tsptalk View Post
    Bonds not confirming this selling. Is the weakness in bonds today (higher yields) another sign of a possible rally in stocks next week?
    Yes, I believe so.

    It could start any day now. I'm just waiting for that big capitulation plunge around 740. We do not want to see a slow bleed down the Bollinger band like we saw early last Oct.

    With only one IFT left, perhaps I'm trying to time it too perfectly. That is not a good thing.

  8.  
  9. #5

    Join Date
    Jun 2004
    Location
    In Your Imagination...
    Posts
    3,573

    Arrow Re: Is a bounce too obvious?

    Yes.

    I commented about this in my account talk:

    The DOW is now at a 7 year low, albeit on low volume. The S&P 500 has yet to breach its Nov 08 low... only 37 points left to drop. I just may forego waiting on the additional 37 point drop in the S&P 500 in order to get on board for the inevitable bounce which I believe is now within reach.
    Rod
    "Treat your wife with honor, respect, and understanding as you live together so that you can pray effectively as husband and wife." 1 Peter 3:7

  10.  
  11. #6

    Join Date
    Sep 2006
    Location
    Upstate NY
    Posts
    1,948
    Blog Entries
    45

    Default Re: Is a bounce too obvious?

    Maybe the lack of a bounce is a sign that some of the things that have worked in the past 12 months are no longer working.

  12.  
  13. #7

    Default Re: Is a bounce too obvious?

    Some info from www.sentimentrader.com: 2/20/09

    "A short-term setup we've discussed a few times is that the market tends to rebound when we see 3 consecutive days of very weak breadth on the NYSE. This week has certainly qualified, as the Up Issues Ratio on that exchanges has been under 33% every day.

    "The last time we've seen three straight days with less than 1/3 of NYSE issues managing a rise was November 12 of last year. The S&P gapped up the next morning and rose more than 6% during the day.

    "But this morning, unless things turn around in a hurry, we're seeing a fairly substantial gap down, with the S&P indicated to open more than 1% below yesterday's close. Looking over the past 25 years of history, there were only six days when the the Up Issues Ratio was under 33% for three days, then the S&P gapped down by more than -0.5% the next morning.

    "Those dates were 08/09/82, 04/14/87, 10/19/87, 04/04/94, 07/24/02 and 10/10/08. Each one of those occurrences coincided with at least a short-term bottom that day. The average intraday drawdown (excluding Black Monday in 1987) was around -1%, but (again excluding Black Monday) the market reversed to close higher than the open each time. If you had waited for the close to buy instead of the open, you would have avoided the disastrous drawdown in October 1987 while still being able to participate in further short-term gains.

    "...when were the last two "Dow Theory" sell signals, according to when they both closed at a new three-year low on the same day? October 9, 2002 and October 3, 1974. Over the next three months, the maximum drawdown from those two instances averaged -2.1% and the maximum gain averaged +21.2%. Some sell signal, that."

  14.  
  15. #8

    Default Re: Is a bounce too obvious?

    Dow up 100, but looking deadcat-like. We need more power, cap't.

  16.  
  17. #9

    Default Re: Is a bounce too obvious?

    I think we really need to see 778-780 to establish a short-term uptrend. Anything less and we will have an inside day, which could fall apart at any time.


  18.  
  19. #10

    Join Date
    Sep 2007
    Location
    Almost Heaven
    Posts
    1,939

    Default Re: Is a bounce too obvious?

    Quote Originally Posted by tsptalk View Post
    I think we really need to see 778-780 to establish a short-term uptrend. Anything less and we will have an inside day, which could fall apart at any time.
    Looks like it's trying... of course anything could happen when the witching hour/half-hour arrives.
    Which one of you nuts has got any guts? -- Randle P. McMurphy
    ... stupidity will always find a way. -- Nnuut

  20.  
  21. #11

    Join Date
    Feb 2007
    Location
    San Diego, CA
    Posts
    6,948

    Default Re: Is a bounce too obvious?

    Quote Originally Posted by Minnow View Post
    Looks like it's trying... of course anything could happen when the witching hour/half-hour arrives.
    It might happen today (dive), the VIX took a dive and profit takers might want an out today.....
    THIS IS WHERE I WOULD PUT SOMETHING TO REPRESENT MY THINKING, BUT THEN THEY SHOW UP!
    Tracker =
    100%- I Fund

  22.  
  23. #12

    Default Re: Is a bounce too obvious?

    Quote Originally Posted by tsptalk View Post
    I think we really need to see 778-780 to establish a short-term uptrend. Anything less and we will have an inside day, which could fall apart at any time.
    775... Everybody... push, push!

  24.  
Page 1 of 3 123 LastLast

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
SPY (C Fund) (delayed)
Is a bounce too obvious?
(Stockcharts.com Real-time)
DWCPF (S Fund) (delayed)
Is a bounce too obvious?
(Stockcharts.com Real-time)
EFA (I Fund) (delayed)
Is a bounce too obvious?
(Stockcharts.com Real-time)
AGG (F Fund) (delayed)
Is a bounce too obvious?
(Stockcharts.com Real-time)

Yahoo Finance Realtime TSP Fund Tracking Index Quotes