The case for a Q4 blow-off rally

B

BlueHorseshoe

This is quite simple folks - in the short term I've shed the bear monkey and grown bullish on US indices, esp mid-Oct through end of year, based on four pillars:

1. Oil has held back the market, but oil typically peaks in Sept before collapsing through the rest of the year. Effect might be muted this year 'cause strategic reserves will have to be rebuilt, but seasonal effects should still have impact:

http://www.spectrumcommodities.com/education/commodity/charts/cl.html

2. We all know Nov-Dec is usually huge for equities:

http://www.spectrumcommodities.com/education/commodity/charts/sp.html

3. Lots of good news pending out of Japan with landmark election Sunday. Watch the Japan chatter pick up big-time with a Koizumi win. Seems the world has forgotten this is the world's second largest economy.

4. US markets still acting hugely bullish even as they lag other international markets that are repeatedly crashing through new highs.

Over the next four weeks, count me buyer on any 2-3% pullback. Lets just hope an entry presents itself ....
 
I should add, these Q4 rallies typically carry through to Feb-Apr timeframe because press and dumb money gets sucked in during the new year... so exit isn't necessarily Jan 1, though exits should definitely be on the radar screen at that point.
 
in most years i'd agree but with the market near 4 year highs i'd say oct will show a big pullback and once the 200 bil tab sets in for katrina bond yields should sky
 
The most money that's lost in the market is from those who say "this time will be different" or "in most cases I'd agree _but_..............."
 
Quote from drukes1234:

The most money that's lost in the market is from those who say "this time will be different" or "in most cases I'd agree _but_..............."
More...

Sooner or later a trader, in order to become a promising one, will have to change his posture and realize that gloom&doom scenarios are not for real a common reoccurrence.
 
Quote from BlueHorseshoe:

This is quite simple folks - in the short term I've shed the bear monkey and grown bullish on US indices, esp mid-Oct through end of year, based on four pillars:

1. Oil has held back the market, but oil typically peaks in Sept before collapsing through the rest of the year. Effect might be muted this year 'cause strategic reserves will have to be rebuilt, but seasonal effects should still have impact:

http://www.spectrumcommodities.com/education/commodity/charts/cl.html

I've reviewed your seasonal chart, mind you I'm no Crude expert, and you are correct this years crude market has acted seasonal as well, albiet at outrageous levels:

seasonally...this year
a) low around Jan/Feb...this year low around December, early
b) high around Apr...high in April
c) low around Jun/Jly...low around May, early again
d) high around Sept/Oct...hmmm is this October already?

If Sept/Oct is usually the peak demand time to build heating oil reserves. And, typically the worse two months of the year for stocks: most of the crashes occurred in October. I'm missing your scenario completely. See attached:
More...
 

Attachments

Looks like if crude is gonna make a head & shoulder pattern and if that's the case I'll position short.

Maybe this will be the time...
 
Quote from gharghur2:

totally agree!
More...

Do you trade this tumultuous market?

I had some success in the past trading digital barriers and binary options on crude but now I'm having a hard time figuring out the very next move.
 
You must log in or register to reply here.
Back
Top