has the next bear started?

Thanks pabst, and I yours, especially your treasury commentary. Don't recall any political disgareements but I went through a period of reactionary pacifism after 9/11 in part because of a belief in Christianity. I have since liberated my mind from that particular bondage and am far more pragmatic.
 
Quote from phillyflipper:

I will put my neck out there and say a top is in on ER at 821 and change and we correct to 765 over the next 10 weeks. ...No, I am not smoking anything. If 765 does not hold then we go to
728 over an additional 8-9 weeks. And this will be a pullback in an uptrend that started on 03/14/2003.
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I played it the way I saw it at the time. stayed short for 4 days and took my stop today. Good trading to all and congrats to all who got it right. Keep looking for the next set-up.
 
Quote from Pa(b)st Prime:

Don't fight the Fed, lol.

They've raised rates seventeen times since 2004. Not a clear correlation between monetary policy and equity prices, eh?
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I agree that it would be far too naive to blindly follow the slogans (such as "Don't fight the Fed"). However, the correlation is there, although it's not directly between the monetary policy and the equity prices, but between the long term interest rates and the equities' expected return. More precisely, despite the 17 rate hikes, the spread between E/P stock yields and the 10yr bond is positive, and its absolute value is very significant. To me, it explains perfectly why we've seen such a straight and consistent advance in the S&P 500 and other indices. And the advance is far from over, as the current spread still indicates that the stocks are undervalued by as much as 30% compared to bonds. To put it differently, if there is a crash, it would be in the bond prices, not the stock prices.
 
Asia has to stop using the bond market as a tool to manipulate our economy and the global economy. The yield curve used to provide vital price signals to the markets. With active manipulation they no longer function.
 
Quote from Pa(b)st Prime:

I'm not a bull by any means (I'm flat indicies/ working some spreads) but volume has nothing to do with anything.

'Never sell a quiet market", eh?

Some of the most lethal rallies (like this one) are grinding, light volume affairs where shorts are lulled in only to see very little for sale. Some traders are short up the ass and there's nothing to cover against.

In fact I'd say lack of volume is a confirmation of trend as often as not....
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Still love ya, Pabst. :p
 
its rather amazing I called this ahead of time, so I guess my indicators work. Now the question is since I had never seen anything like this does it indicate:

a) a crash
b) correction (maybe major)
c) bear market

I note that even during selloffs like 2006/2004s these indicators didn't diverge like the did recently. So I dont think its #2 (since in past correction the correlations held).

In short, I have never seen the action I saw in the past on the indicators as of now; thus I dont have anyway to say this action leads too.. since its the first time its happened.


I would think its C.

Thoughts?
 
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