UBS make ridiculous market prediction

[Mkt.Cap]

... seems that some people have to validate themselves and their role in this market environment.

 

[Cutten]

Quote from drukes1234:

So if I were to tell you that by the end of 2009 the S&P would be at 1275, you would say that's crazy? A 50% gain in 2009 is a very reasonable prediction (we got a 20% rally in one week last week) -- I don't know if they're right, but it's not that ridiculous of a projection

Equally, a prediction of a 50% fall isn't ridiculous either.

 

[Cutten]

Quote from Landis82:

In my opinion, the big problem with such a philosophy is that we are having "counter-trend" moves that are significantly tradeable . . . there are incredible percentage moves out there that are occurring on a daily and multi-daily basis that are tremendous opportunities.

To simply sit back and NOT trade ( from the long-side ) because the indexes are in a very bearish multi-month trend doesn't make a lot of sense to a TRADER.

For example, BTU traded from a low of 19.27 this morning up to a high of 22.67

As TRADERS, are we not suppose to take advantage of that 17% move, even though the trend in the indexes is down???

On the other hand, remember the quote from Livermore:

"Disregarding the big swing and trying to jump in and out was fatal to me. Nobody can catch all the fluctuations."

There's a lot to be said for ignoring the short-term volatility, and playing the big swing. Anyone with the foresight to short the S&P earlier this year, and sit on their position while the trend remained down, has made 500+ big figures per contract. I suspect that most people going for the small swings have not made 500 ES points per contract this year.

Focusing on the big swings doesn't make someone an investors, it just makes them a position trader instead of a daytrader or short-term trader.