Lest it need to be said again, my belief is that:
- The ultimate bottom to this bear market is years off, in the vicinity of 2014-2015
- Once the bottom is in, people will think of the Dow priced at 8,000 as "the good old days"
- These violent, explosive bear market rallies are God's gift to bears (September 18/19, yesterday, etc.)
Between now about ~2014, will there be sustained moves higher? Absolutely! Will many months go by where the bulls are the winners? Yes. Obviously it's not a straight down line. The artistry is going to be knowing, given current conditions, what the short-term horizon holds. There will be times (like last Friday) when I'm buying everything in sight. If I get my head screwed on right, there will even be times when I buy and hold for more than a day or two!
If nothing else, I try to be plain with my prognostications. Even the most over-the-top clarity still seems to elude folks (although I have a suspicion the second comment was tongue-in-cheek):
For the good people who have voted Slope into a leading contender on the Blogger's Choice Awards, thank you. I know that the simple act of trying to vote for me can last a lunchtime, since their site is kind of slow. But, please, if you haven't voted, please do so. And be prepared to be patient.
The powerful move late Friday, all day Monday, and very early today offered some fantastic new shorting opportunities. I bought a bunch of FXP first thing this morning (the ultrashort on China).
As the aforementioned comment from me plainly indicated, I was ga-ga about shorting OIH early today. What convinced me what that chart after chart of individual components looked basically doomed. My rather manic suggestion was offered at almost exactly the peak as it was nearing 115. Here are a couple of persuasive charts pertaining to what I believe will be a continued plunge in oil-related stocks.
I've tinted in most of the charts tonight to show the very significant resistance levels that were hit early this morning. Here's the DIA:
And here, in turn, is the DJ30 itself. Notice the circle I've put on the former supporting trendline. That, to me, is about the highest the $INDU can go. So if, over the coming days, we pushed up toward 10,000-10,250, don't be throwing the schadenfreude my way. I will absolutely take another 1,000 points on the Dow in stride from these levels.
The Transports, badly damaged last week, had the same phenomenon.
Everyone hear knows my tale of woe about the SDP. Well, it was time to make good again. I bought a very large SDP position first thing this morning, and it's deeply in the green already. I tinted the area where we were early today, and I have big dreams for this position. And, for the love of Jesus, I'm not going to sell it until it's at least in the mid-250s.
Trades just don't come any easier than shorting the $NDX first thing this morning. They just don't. Look at this gorgeous chart. A perfect gap fill. A surge to both a retracement level and the underside of a fan line. As John McCain might say, "This, my friends, is a perfect chart."
My postulate that the S&P would quickly surge to the 1050-1075 range caused financial media around the world to sit up and take notice. Actually, no, that's not true. Only a few people here did. All the same, with a high of 1067 (based on around-the-clock trading via the @ES0812), I'd say I nailed that one quite nicely. The chart beneath is the $SPX (which trades a mere 1/4 of the time the ES does), but you can see via the tinted circle where the high was nailed on the underbelly of the former support channel.
I keep an eye on the FX markets since they have a very meaningful relationship with our own equity markets. The explosive surge in the dollar is going to settle dramatically. I am a long-term dollar bull, but for the short term, I think the dollar is going to ease back.
And now, for your viewing pleasure……….(Slope denizens will probably be able to get the joke):
