Reentry Points For Long Positions

P

Petsamo

I believe we're witnessing a second head & shoulders formation. The 1025 area in the S&P would form the neckline. Furthermore, it is proximal to the bottom of the Bolinger Band.

What are your theories on a good reentry point for long positions? And is it temporary or permanent? Please justify your your theory. If it's just a guess, then say so.
 
Quote from Petsamo:

I believe we're witnessing a second head & shoulders formation. The 1025 area in the S&P would form the neckline. Furthermore, it is proximal to the bottom of the Bolinger Band.

What are your theories on a good reentry point for long positions? And is it temporary or permanent? Please justify your your theory. If it's just a guess, then say so.
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I'm inclined to agree, to the extent that I allow myself to anticipate things. The volume and breadth of this recent sell off makes me think the bounce isn't going to be make a higher high. I've switched to commodities and materials stocks for the most part, but I hope I'm wrong about the bounce.
 
Quote from Petsamo:

I believe we're witnessing a second head & shoulders formation. The 1025 area in the S&P would form the neckline. Furthermore, it is proximal to the bottom of the Bolinger Band.

What are your theories on a good reentry point for long positions? And is it temporary or permanent? Please justify your your theory. If it's just a guess, then say so.
More...

666. Sorry, couldn' t resist. :p


998 is weekly SMA.
 
You re-enter when the previews bulls declare this rally is over and its time to sell:

* Laszlo Byrini
* Barton Biggs
* Anthony Bolton
 
Yes, this is turning into a head and shoulders formation, the one in July failed right after everyone noticed it. Thus, it makes this formation much more likely to succeed, after a failed head and shoulders. Plus, we've got the complacency and the price action to back up the bear case. I think we go down to 960 in November.
 
Quote from marketcynic:

Yes, this is turning into a head and shoulders formation, the one in July failed right after everyone noticed it. Thus, it makes this formation much more likely to succeed, after a failed head and shoulders. Plus, we've got the complacency and the price action to back up the bear case. I think we go down to 960 in November.
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I believe the first head & shoulders failed because, given the economic conditions, the SPX was still too low.

Regarding the 960 in November, I estimate the bottom of the shoulder to be 990, which is 10% from the top of 1,100. What I will be looking for, before I jump back in the long position, is the $VIX dropping for 36 - 48 hours, while the SPX hovers in a narrow range, just like the previous head & shoulders.

Until we reach that area, a lot of things can happen, but for now, I believe we will resolve up - again. The experts I follow believe we will stay bullish.
 
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