...of an intermediate bottom. Here's some more support for that position. I would LOVE for the market to make a move down to support levels or below (1,185 area on S&P; 2,100 on NAZ; and 10,250 on Dow).....but Mr. Market doesn't really care what I want. Suffice it to say....we are in the close neighborhood of the bottom.
Below is an article that takes a look at market timing newsletters that have a GOOD TRACK RECORD (this is NOT the Investors Intelligence Survey.....which is a CONTRARY indicator). -----------------------------------------------
ANNANDALE, Va. (MarketWatch) -- Making sense of the stock market's short-term gyrations is never easy. But the market seems especially inscrutable now, with the market going up on seemingly bad news and declining on what might otherwise be thought to be good news.
For answers I decided to turn to the market timing newsletters with the best long-term records. As it turns out, the majority of the top ones are bullish right now.
On the theory that they are more likely than not to continue their winning ways, this bodes well for the stock market.
My list of top timers contains the five newsletters on the Hulbert Financial Digest's monitored list whose market timing advice has produced the best risk-adjusted performance over the past decade
There actually were six on my list, but one - with the best record of any of them - is an entirely mechanical system that switches into and out of the market on the basis of the calendar. It will be bullish until the end of the first week of September, at which point it will switch to cash for a couple of weeks. I excluded this newsletter because its current bullishness has nothing to do with longer-term expectations. -----------------------------------------------
By the way......the "mechanical timing" fund is interesting to me. The first week of September is usually slow for IPO's, so that makes sense that it is usually a "bullish" week.
jchriss, you make some good points but i am still bearish. don't see how the economy can sustain virtual complete loss of a major city combined w/wreckage of number of smaller ones without fairly major consequences over the next year. combine that w/ $70 oil and $12 gas and resulting limits on spending/fed ability to give relief. not good combination. you may wind up being right as usual but on this end am maintaining broad market short, sentiment readings notwithstanding. very much appreciate the dialogue by the way.
Dialogue is a healthy thing......ESPECIALLY when opinions differ.
I understand your FUNDAMENTAL reasons for what you believe. Fundamentally......I ABSOLUTELY agree with you.
However.....fundamentals are NOT what moves the market over the short and even the intermediate term (it IS what moves the market over the LONG TERM).
Over the short and intermediate term, what moves the market is LIQUIDITY and SENTIMENT (and they are usually reflected in TECHNICALS). Keep in mind.....I am NOT ignoring fundamentals. It's that there is usually a 6 - 9 month LAG before the fundamentals kick in.
What moves the stock market (overall stock market....not individual sectors).....is supply and demand for stock. If most people are investing in a bearish manner (such as yourself)....then they are NOW future buyers (not sellers) of stock, because they have already sold (or shorted). That is why I was BEARISH in late July and early August.....because everyone and their cat was BULLISH. If everyone is bullish already......where is the money going to come from to push the market higher? THAT is what caused the top in late July (in addition to the numerous IPO's in August).
In summary....I agree with your fundamental thought process.....but I STRONGLY disagree with your expectation for the marekts over the next 2 - 3 months. By the way....my bullish call is NOT a long term call. It IS a call for the next 2 - 3 months (that is as far as I can see).
Remember......the "wall of worry" is built by BEARS....not bulls. Bears put a floor under the market. I expect the Investor Intelligence numbers to become more bearish over the next several weeks because they usually lag the market.
I am much more "concerned" (ie bearish) as we approach the end of the year (November or December). That is why I subscribe to the Economic Cycle Research Institute (they are the pros on business cycles).