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Juniper Networks, Inc. Message Board

  • jamesjcramer2004 jamesjcramer2004 Mar 26, 2004 3:55 PM Flag

    Why a Flat Day Today Would Be Scary

    Darn! As I wrote and posted here earlier in the day, we are flat! That poses problems for next week.

    For those of you that missed my earlier column:

    A nice dip today would be good for bulls.
    A flat day would evoke bad memories.
    The old patterns have to be broken.

    In the bear market days of 2000-2003, we had three-day wonders: A big up day followed by a flat day, then another big up day. Then we had the total collapse. We had that pattern a half-dozen times.

    It's pretty clear in retrospect that we had shorts who battled on day one, battled day two and gave up on day three. Once the shorts were covered, we had no ammo left to take things higher, and they collapsed of their own volition.

    Obviously, a better pattern for the bulls would be a nice decline today, a decline big enough to bring more people in but not so big as to break the new trend. Conversely, a flat day would be too reminiscent of that old pattern. And an up day would be a huge question mark, because that would signify something truly remarkable: big gains that were sustainable and capable of being built upon without the help of shorts.

    I say this because I saw very little short-covering Thursday. We went up naturally and gingerly over the course of the day. It would be just as "natural" to come down a bit today as traders took profits.

    So in a bizarre way, as someone who is way long, the only thing I don't want to see is, well, nothing. That's the old pattern, and it needs to be broken.

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