Which means higher highs and lows for next 12-18 months,
US market up 20% plus at end of December 2016 with U sector outperforming broad indexes.
Statistical evidence about R/S is not friendly to longs. 9 out 10 times pps long term trend doesn't change. At least for several more months after.
Contemplating doubling my position under "perfect" circumstances. Based on Soros's formula: no leverage is too large when right opportunity reveals itself.
Cyclical growth stocks are known for explosive pps appreciation.
To complicated for me to understand it but personally i'm afraid of drying trading volume more than shorts. Even though i believe shorts are generally speaking better speculators mainly because they seem to be less driven by fear or greed,still they are far from perfect. Short squeeze appears to be more common than panic selling or buying.
The reason why i'm afraid of low trading volume is manipulation risk. And often after many years of relentless pressure on share price at some point this exactly what you get.
When daily trading volume drops to a trickle shorts are your only friends because unlike manipulators you know sooner or later they will have to increase volume.
This market is similar to Feb 2009 - Spring 2011 in some respects with important repercussions for commodity sector for next 12-24 months.
Shorts obviously bet on continuation of the downtrend but there is no straight connection between increased short position and share price decline. Not based on my observation.
Quite often opposite is true but in my opinion option market tells you more about participant's attitudes.
Besides 6% of the float is not that significant number.
I wish it was much higher.
I thank you for the wisdom and sound of reason you cotribute to this message board. It is rare moment in time to have someone special as you,Mess and few others that make this small mb world friendly place. This is what i'm always looking for but rarely find.
ps: more on timing "calibration" for new trend arrival. If recent history is repeated Feb-March should be the best environment.
If what you speculating about becomes reality U market will have been in the longest downtrend in history.
11 years,possible but unlikely in my ho.
I'm affraid i sound like broken record by repeating the same theory time and time again about significance of current world broad market intermediate downturn: it is all about technical picture of China and US markets.
First one is attempting to end it's long term down trend with last cyclical bear.Second one is having health restoring correction. When it's all over both markets will move side by side with Chinese ouperforming US as it had been the case before 2007 and the rest is just noise we pay to much attention to due to increased volatlity enhancing collective fear level.
Sorry for misunderstanding. My point is this: many people believe that having shares in publicly traded company they are part owners. This is not what i believe so let me ask you question based on my definition how do you plan to make money in company which is in survival mode AS PUBLICLY TRADED ENTITY?
I'm not sure i understand his theory but my own gut feeling tells me something which is maybe close to his view:
you can call it equities rotation phase where "Wall Street Darlings" are brought little closer to the ground and beaten up companies are pushed higher. This makes sense if market is concerned about "health" and longevity of secular bull since the most dangerous threat comes in form of equity bubble.
You have to remember that even though QQQ's are still below 2000 high, new sector of technology primary social media stocks have reached bubble valuation level.
As matter of fact what i'm doing with my retirement money which is invested in aggressive growth portfolio is to move 50% into value oriented stocks with higher exposure to commodity,energy and utilities.
UTSI share price is currently under total control of Chinese market's systemic risk which is in the process of creating long term trend final capitulation stage.
I'm looking for FXI to challenge Feb-March 2009 support/resistance level.
While back URRE was part of my portfolio. Now i'm in UUUU and there is big difference as far as managements of both companies view of their market exposure: URRE is in survival mode while UUUU management is buying shares on open market.
You be the judge.
You can translate it as "collective wisdom of all market paricipants" if you prefer.
Personally i believe it is more "american" to call someone black instead of more politically correct african american because i'm not racist nor politician.
In order to understand what's happening you need to ask most important question: what is the share price the management is accepting as fair, based on current market conditions.
Now you know as well as Mr.Market so should anticipate additonal pressure to see if there are any more sellers at this level.
As soon as i come up with the idea for short term market direction my ego gets punished. Iguess i have to be told to keep my mouth closed.
Maybe shorter in duration than previous periods based on my understanding of what Bill Gates is currently spending most of his energy and lot of money on.
I'm sure most of you know about Terra Power project. Looks like the first prototype of this next generation nuclear power plant is moving couple of years ahead of schedule.
I'm interested in constructive comments.
Let me add one more factor supporting my conclusion: since 1982 all secular and cyclical US bull markets started in first three months of new year and looks like Chinese market is about to follow similar pattern/ FXI is down almost 60% since Summer 2007/.
2003-2007 was very important period for two worlds most important markets. Spring 2007 marked peak of Chinese equity bubble which was responsible for worldwide commodity bubble with barrel of oil at $150.
Bear markets of 2007-2009 were not sufficiently long enough to dissolve both Chinese equity and world commodity bubbles but nine year old bear which falls into historically confirmed period of time is.
Logical conclusion is obvious: we are at the very early beginning of another secular bull run in commodities. What this mean is that for the most part commodity sector will be responsible for much higher % of broad market gains for forseable future.
Yesterday was classical reversal day for broad US market where majority of participants decided "no more testing and probing".