Now that we have hit new lows, I am trailing a pretty tight stop on DXD. Don't want to lose a lot on an upwards whip-lash.
Market Bottom a la Mamis
- Thread starter PetaDollar
- Start date
Okay I'm not fooling around with this trade any more, just got out. Overall it worked out really well. Volume is really really high today and the price came back up. To me that means snapping up shares at bargain prices. Best to take profits and move on.
I will post a big picture update this weekend. Right now NYSE says 546 new 52 wk lows, which is far less than the 1527 new lows hit on 11/21. So we have a divergence. To me this means I can start looking for long-term buying opportunities. Market may hit some more lows this year, but if the number of new lows in individual stocks continues to decline that's a sign the big move down is done.
Looking at the stocks hitting new lows today-- tons of bank stocks. I guess they are dragging down the index.
I will post a big picture update this weekend. Right now NYSE says 546 new 52 wk lows, which is far less than the 1527 new lows hit on 11/21. So we have a divergence. To me this means I can start looking for long-term buying opportunities. Market may hit some more lows this year, but if the number of new lows in individual stocks continues to decline that's a sign the big move down is done.
Looking at the stocks hitting new lows today-- tons of bank stocks. I guess they are dragging down the index.
Code:
Date Dow Intrdy Low NYSE 52Wk Lows
9/18/2009 10404 1108
9/29/2008 10267 1170
10/10/2008 7774 2901
11/21/2008 7392 1527
2/20/2009 7249 555update since the Dow hit another 52-wk intraday low:
I saw an article today headlined "Market downturn accelerates." The data show us that actually it is decelerating.
Code:
Date Dow Intrdy Low NYSE 52Wk Lows
9/18/2009 10404 1108
9/29/2008 10267 1170
10/10/2008 7774 2901
11/21/2008 7392 1527
2/20/2009 7249 555
2/23/2009 7106 395I saw an article today headlined "Market downturn accelerates." The data show us that actually it is decelerating.
I hear many talking about new lows being < they were on the last selloff to this level.
But I'm suspicious that it means much. Why?
It's much easier for new lows to print on the FIRST smackdown. The second or third wave would produce fewer new lows as a matter of simple math , unless EVERYTHING, no matter how low it went on the first slide, just crashed lower.
Think about it.
But I'm suspicious that it means much. Why?
It's much easier for new lows to print on the FIRST smackdown. The second or third wave would produce fewer new lows as a matter of simple math , unless EVERYTHING, no matter how low it went on the first slide, just crashed lower.
Think about it.
777, that's the point. If there were 1500 or 2000 new lows today it would mean everything was crashing. But there was much less. So everything wasn't crashing.
It isn't predictive, it just tells you what happened. There nothing that says the market can't hit new 52 week lows next month, with 250 stocks hitting 52 week lows.
It's kind of like saying a car going 60 mph South must first go to 0 mph before it can go 60 mph North. It does not mean that once he gets to 0 mph he must go North. He might just speed up going South again.
Place your bets.
It isn't predictive, it just tells you what happened. There nothing that says the market can't hit new 52 week lows next month, with 250 stocks hitting 52 week lows.
It's kind of like saying a car going 60 mph South must first go to 0 mph before it can go 60 mph North. It does not mean that once he gets to 0 mph he must go North. He might just speed up going South again.
Place your bets.
This is what I'm saying. In the first meltage (Sept 08), there is a tendency for stocks to spike down QUICKLY to levels that have little or nothing to do with intrinsic value. Fear factor.
You get huge numbers of new lows, as this is the first wave of selling, and new 52 week lows are quite easy to make.
Then you get a period of rally and consolidation. Panic is less of a factor.
On future selloffs , those prior panic lows are harder to take out, especially in large numbers on the SAME DAY.
I don't think it says ANYTHING about how bad or intense the selling is. That's my point. Take it or leave it.
This is my own take on this, not ripped off from some supposed guru. I think these 'popular' indicators fall victim to simplistic interpretation all too often.
I repect Mamis, and I'm not sure if he dealt with this issue or not. If anyone hasn't read the Nature of Risk, you're derelict in your studies.
You get huge numbers of new lows, as this is the first wave of selling, and new 52 week lows are quite easy to make.
Then you get a period of rally and consolidation. Panic is less of a factor.
On future selloffs , those prior panic lows are harder to take out, especially in large numbers on the SAME DAY.
I don't think it says ANYTHING about how bad or intense the selling is. That's my point. Take it or leave it.
This is my own take on this, not ripped off from some supposed guru. I think these 'popular' indicators fall victim to simplistic interpretation all too often.
I repect Mamis, and I'm not sure if he dealt with this issue or not. If anyone hasn't read the Nature of Risk, you're derelict in your studies.
update since the Dow hit another 52-wk intraday low:
Code:
Date Dow Intrdy Low NYSE 52Wk Lows
9/18/2009 10404 1108
9/29/2008 10267 1170
10/10/2008 7774 2901
11/21/2008 7392 1527
2/20/2009 7249 555
2/23/2009 7106 395
2/27/2009 7034 331Well, I regret not having updated this thread in 7 months, but here is the current situation:
