Tuesday

Market Rebound Countdown D-2/3

Post a Comment March 10, 2009 – 4:58 am |   | Permalink |  Print This Post |

Another down day as predicted. Dow Jones fell by 79 points, closing at 6547 Monday. The lack of buyers rather than selling pressure caused that move. Looking at the charts, we have another 2-3 days. It is impossible to quantify the drop. Whilst it is tempting to go long now to preempt the impending rally everyone is expecting, it seems all too obvious. Every blog and “expert” out there are expecting a rally, and that is our concern. What could be the twist to allow markets to rally and yet catch all the long positions? The probable answer is: A BIG drop + a truncated rally to catch the bulls. We will refrain from making too many calls - we have our necks sticking right out as it is (Read Title of article). Yes, we love to put our reputation (what reputation!?) on the line and risk public humiliation.

There was a surge in traffic on TheInflationist in the last few days (at least something is going the right direction) resulting in our server crashing intermittently. So we are currently moving TheInflationist to a dedicated server (expect some downtime). There was another small move in the McClellan Oscillator last night - so the big move is still around the corner. Erring on the side of caution, we are putting a 3-4% buffer from yesterdays close to our orders to open. Some may argue that we will never be taking a position if we keep moving our orders to open down; which brings us to another golden Rule: It is better not to lose money than to make less money. Our orders to open tonight are 6280 at $10/point (ie 4% from yesterdays close) and 6350 at $5/point (3% buffer). Having said that, our candle chart roadmap suggest a small green candle may be possible tonight.

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