STOCK MARKET CRASH PART 3 - HAVING FUN!
The Internet is a funny animal, put a bad story in the head line and jack up your traffic over night. I know I have been burned enough times looking for Victoria Secret models and winding up with an article about the spotted owl and how endangered it is. Just putting crash in the title brings in the people looking for a bad story. Ironically they are getting to a spot that legitimately talks about the markets. I don't know why everyone thinks we always have to have a huge rally or a huge decline based on what they study.
When I talk to people it seems if their indicators or methods are bullish they think the market will explode and if they are bearish they think it will crash. Why can't it just be viewed as it will go up or it will go down? I think extreme thinking is what gets people into trouble in trading. I will admit I am the first guy who wants to catch a crash because when you time them right you get a huge windfall immediately. Rallies tend to stair step and unfold more slowly.
What I have for tomorrow is just some standard oscillator, not even one I use to trade. I have it on the chart just to show something. I have an up close projected in the price tomorrow and as you can see the oscillator is not turning up. This typically means we should have a down side bias for a day or two. There is nothing absolute in trading and neither is this concept. However, it does typically provide some insight into the next day or two when this situation is at hand. There are some indicators that work much better than others and I don't know if this one I just randomly picked is better or worse than the ones I actually use.
If it tells me the edge is to the down side I don't think it means the market will crash, I just think it means it is more likely on average to decline than to rally. If this turns out to be correct it should be a general bias across many markets to the down side due to how heavily correlated everything has become to the stock market. Let's see what happens. My apologies to those who tuned in here to find a gloom and doom forecast and actually got someone who really trades giving an honest appraisal of what he thought might happen.
I have read some non-traders who write about the markets pointing out the lack of volume on this bounce as a big negative. You can always tell when a writer does not actually put his own money at risk in trades when they talk about things like this. There was a time when I bought into the Edwards and Magee stuff about when light volume accompanied a price move it meant it would reverse and when heavy volume accompanied a price move it meant it would continue. It is only when you try to trade these ideas and lose money that you learn that they are not accurate predictors of price moves. I do not claim to be the wizard of oz I am far from that. However, I would much rather listen to someone who actually trades even if he loses than some of these paper champions who just write about doing it.
Here is a chart of the SPY with this supposed volume theory fully exposed as bogus. If you look at all the examples in this chart it is almost rare to see this theory right anywhere! If people who write these things actually traded real money they would know this relationship does not exist. More often than not a rise in price with volume accompanying it was a great selling spot not a buying opportunity. Also declines on lighter volume tended to keep going, again the opposite of what people write about. I read the lightest volume day in some time accompanied the holiday and that was very bearish. I challenge anyone to show me a consistent chart pattern that supports that theory. It can be correct on a one off basis of course, but you can see on the chart above this theory simply is hogwash.
ARGHH this kind of thing frustrates me
Lets look for a decline the next day or two and then see how things look. I have not mentioned PFG much lately because the story has jumped the shark. There seems to be almost nothing happening at all and I guess just now they are contemplating starting a bank investigation. Good grief, what the hell have they been doing for the millions they have made? I will tell you, running the clock. That is what attorneys do and how they get paid. Screw the victims and joke about it at the club over tea at 3 pm. I originally thought the goal was just to get the whole $24 Million that was in PFG's bank account and now I think they are going for a larger target than that. I predict that will hit the over and dip into whatever other money they have found giving us less and less in the process of stalling. Guess what, if one of the attorney's involved happens to read this I could give a ..... It is time someone had the nerve to publicly call you out for what you are. I will take the heat for saying what needs to be said. I am not one to go quietly when I have been wronged and I never will be.
I think it is pretty obvious since that $24 Million has not been mentioned for months that it is either already gone or is in the process of being taken by the attorney's. It should have been ours and it is ours you skunks! I read today in the web site there was a 6th motion filed to stop paying lease payments to Pitney Bowes and a few other vendors because it does not benefit the estate. Why on God's green earth did that require 6 motions to be ruled upon?