While I agree with your general premise, you fail to understand the point at which bad and negativity is priced in, at least short term. Everyone and his uncle is bracing for a worldwide depression. Everyone knows about the credit crisis and sub-prime mortgage debacle. Market is due for a bounce. And just when everyone thinks the worst is over and the market is headed for new highs, then it's time to short. But as of this morning I'm long several issues, including RVBD at 18.99 and AAPL at 119.
Whether or not RVBD is going up or down (and I obviously say it is going up), even you must concede that the MM's will do every thing in their power to make sure this doesn't come close to touching $17.50 with options expirations coming up next Friday. Saying it will hit $16 or $17 today is like me saying RVBD will hit $30 pps today. The difference is that $30+ pps could actually happen Yahoo style with a buy-out offer from CSCO or GOOG today or in the near future.