12/28/10 - Why is anyone still buying II?

[brosin]

Follow up to.... www.fastopia.proboards.com/index.cgi?action=gotopost&board=brosin&thread=7377&post=88300

Only 4 months ago, FAS was around $17, the economy and stock market looked like a double dip was all but done, and it was incredibly lonely on the bull side. If you back up to the summer, I think I was one of the few who was still *long term* bullish, and even I was supremely tested. I was really torn for a couple weeks in Mid Aug (you can see it in my blog posts from those dates), and honestly considered whether my long term bullishness was wrong. At the end of the day (summarized on 8/26), I stayed bullish. Even in that thread, you can clearly see that not many agreed with me there. Hell I barely even agreed with myself (I had started my core FAS trade 2 weeks earlier and really felt as if I was going down with the ship)...

My point: now, 4 months later, no one wants to be out of stocks, I've never heard so many comments about 'easy money,' everyone is talking about the Fed/POMO/QE61346436/etc etc etc etc etc, and bullishness is at ridiculous levels judging by the VIX, put/call ratios, and AAII sentiment readings.

And the funniest thing to me? This is not even a new thing THIS YEAR!! We just went through this all in April (only to see 4 straight *brutal* months), where bullishness would not cease. It was dangerous then (as I clearly stated in my 4/13/10 post that this thread is a follow up to), and it is dangerous now. "Dangerous then" led to a flash crash. What will "dangerous now" lead to?

I am sure people will think this post is as crazy, stupid, foolish, whatever as they thought my bearish (4/13/10) and bullish (8/26/10) posts were... both ended up correct. I have been encouraging caution and selling into strength since 1220 SPX early in Dec even though I said I could see us getting towards 1240/50, so in that sense I have not been correct so far; but I had gotten a move from 1040 to 1220 (early Nov) correct on the nose, the move from 1220 to 1175 correct on the nose, and the move from 1175 to 1220 before then getting Yogi-ish. So I have zero problem missing this final 3-4%...


I am all ears as to why anyone is still buying at these nosebleed levels after the move we have seen. It makes little to no sense to me; and this coming from the guy who has been talking about a "historical" rally since Sept and Oct. It just can't happen when everyone is bullish though - quite the opposite.

[timber]

i think most people are selling into it brosin at least i have been

[Rich]

The bears are laying in wait, bros.

There should be a good opportunity to go short, but the last thing you want to do is short too early.

We'll know it when it happens.

That said, I don't think the assumed correction will be as bad as the last one. There are a different set of parameters in place.

I have been wondering for a while where it will take us.

[rex]

This time last x-mas the euphoria was extremely high, just like now. People were talking about how "high will we go" "it(the market) just keeps going up" etc.... Then January came...nuff said. I agree with Carl...a 50-70 point pullback eminent and at S&P 1180, everyone will be talking about "this is what happened during the Great Depession"....Double dip, Euro collaspse etc... Then boom, we'll ascend to 1300+. During bull markets, up two steps down a step was the norm. Now we have up 10 steps down 3 steps...which is scary as hell.

[theMIST]

Charts still bullish as ever. I see next resistance level for S&P as 1300. Cup and handle on S&P measures 1340-1350 range. Russell 2000 (small caps) still looks strong.

Why do you feel we are overbought? In your opinion, what would be the next catalyst to send us crashing?

Is it because we went from S&P1040 to S&P1258 in 4 months time. Approx. 200 point move.

From March 2009 to April 2010, S&P went from 666 to 1220. A 553 point move.

From Aug 2008 to March 2009, S&P dropped from 1313 to 666. A 647 point move.

I'm not saying we're not going to have our pullbacks/corrections of 5-10% (could be as early as January), but IMHO this rally isn't half over.

[rex]

Mist, those were historic moves!! Never in history(except for once or twice at the most in 100 years) has the market moved up this fast, this straight....so many times in a 20 month period. This is twilight zone crap going on here....to answer your question.

[puurfectten]

we goin to da moon guys ...yeeeeehaaaaawwww !!!!

[Clinton SPX]

9 bil pomo a day. why try and short that?

[Clinton SPX]

dow would drop 500 if they announced end of pomo tomorrow

[puurfectten]

what r they buying?

[bellevuetrader]

They're buying the fuckin dip!

[brosin]

This thread kind of went the direction I assumed it would ;D


So the only argument for being long is that "the charts are a buy" and that the "playbook" is to "BTFD?" Charts always look like buys at tops - by definition of course. And they also look like sells at bottoms...

[Clinton SPX]

It aint the charts Bros, its the news.

The news is the fed has put a floor under EVERYTHING.

Its not a real market, until the fed is removed from the picture it wont behave like a real market.

[herceg1967]

GM Bros, still all in cash, but small position started again in HBAN yesterday afternoon..........following many, trading none right now..............

BOL to you !!!!!!

[brosin]

Dec 29, 2010 11:23:06 GMT -5 Clinton SPX said:

It aint the charts Bros, its the news.

The news is the fed has put a floor under EVERYTHING.

Its not a real market, until the fed is removed from the picture it wont behave like a real market.

Okay, agreed. BUTTTTTTTTTTTT (and *this* is what I've been insisting on for a couple weeks now)... the Fed has HAD a floor under everything since 2009. Anything suggesting otherwise is biased, uninformed, or flat out wrong. It was true during the big drop in June 2009, it was true during the big drop in Jan-Feb 2010, May-Aug 2010, and it will be true many times going forward.

Just because there is a floor under everything does not mean that the market will go up every day without fail. In fact, the more it does this (just as was true in April), the more dangerous it becomes.

[cosmic]

I think the key here is when will the Big Boys be allowed to juice the market for all that liquidity. Agreed the Fed's invisible hand is behind almost everything. And running up the market to allow a liquidity squeeze is exactly the perfect cover the Bernanke Boys need to release all that printed cash into the hands of the banks.

I agree with Bros - if you just got in at 1200, that right there is shark filled waters. Breadth has been quite unimpressive. Games games games.

Now you all know me as a cautious, even disenchanted bull, so take it all with a grain of salt.

[Rich]

I agree with Clinton for the most part.

Right now there's not enough volume to know anything.

But we all know bottoms are events and tops are processes.

And we know what these processes look like cuz we've seen them before.

violent ups and downs almost on a daily basis.

We haven't begun that yet.

[puurfectten]

i gree with the "floor under it "...but look at the chart...the floor now is aroung spx 1010....or so...just don't be fooled about that...looking at it in that context..except for scalping up here...it's russian roulette... ;D..u guys do know that..dont u

[Rich]

bad puur

[puurfectten]

lmao..where the heck did all these smileys come from...

[timber]

[cosmic]

I have to admit it's the twitching eye that makes the hammer one so funny.

[bjxxxx]

Real good thread, folks.

My take: this market is, among other things, politically driven. I felt pretty safe being 50% long through the holidays; it would be bad form to suppress the holiday commercial spirits. Now I'm thinking it would not do to welcome the New Year, the extended tax cuts, and (despite last January) the good earnings reports coming out this January with a market dive. And, of course, those regulatory types are drafting financial regulations. Hey everybody, things are getting sooo much better (than they would be if we didn't keep shoveling money into the banks). All due respect to Cosmic -- who puts my market knowledge to shame -- with the zero Fed rate and QE2, the banks are getting a huge windfall and know it. So their message to the world: we just need to stay the course. . . .

[novice08]

Here's the pomo schedule through Jan. 11 (again): www.newyorkfed.org/markets/tot_operation_schedule.html That's at least 35.5 bil...

[brosin]

Dec 29, 2010 12:12:31 GMT -5 puurfectten said:

lmao..where the heck did all these smileys come from...

that about sums it up

or well,

is probably better

[ask2lern]

I think they are all Ben Bernanke emotion icons..............GL

[jack]

Dec 28, 2010 17:33:25 GMT -5 brosin said:

Follow up to.... www.fastopia.proboards.com/index.cgi?action=gotopost&board=brosin&thread=7377&post=88300

Only 4 months ago, FAS was around $17, the economy and stock market looked like a double dip was all but done, and it was incredibly lonely on the bull side. If you back up to the summer, I think I was one of the few who was still *long term* bullish, and even I was supremely tested. I was really torn for a couple weeks in Mid Aug (you can see it in my blog posts from those dates), and honestly considered whether my long term bullishness was wrong. At the end of the day (summarized on 8/26), I stayed bullish. Even in that thread, you can clearly see that not many agreed with me there. Hell I barely even agreed with myself (I had started my core FAS trade 2 weeks earlier and really felt as if I was going down with the ship)...

My point: now, 4 months later, no one wants to be out of stocks, I've never heard so many comments about 'easy money,' everyone is talking about the Fed/POMO/QE61346436/etc etc etc etc etc, and bullishness is at ridiculous levels judging by the VIX, put/call ratios, and AAII sentiment readings.

And the funniest thing to me? This is not even a new thing THIS YEAR!! We just went through this all in April (only to see 4 straight *brutal* months), where bullishness would not cease. It was dangerous then (as I clearly stated in my 4/13/10 post that this thread is a follow up to), and it is dangerous now. "Dangerous then" led to a flash crash. What will "dangerous now" lead to?

I am sure people will think this post is as crazy, stupid, foolish, whatever as they thought my bearish (4/13/10) and bullish (8/26/10) posts were... both ended up correct. I have been encouraging caution and selling into strength since 1220 SPX early in Dec even though I said I could see us getting towards 1240/50, so in that sense I have not been correct so far; but I had gotten a move from 1040 to 1220 (early Nov) correct on the nose, the move from 1220 to 1175 correct on the nose, and the move from 1175 to 1220 before then getting Yogi-ish. So I have zero problem missing this final 3-4%...


I am all ears as to why anyone is still buying at these nosebleed levels after the move we have seen. It makes little to no sense to me; and this coming from the guy who has been talking about a "historical" rally since Sept and Oct. It just can't happen when everyone is bullish though - quite the opposite.

Money's just starting to move into stocks from bond funds and the shoe shine boy on the corner of Wall Street and Bleeker hasn't yet given his latest stock pick to...Bernanke.

Its got some more to go.

[natsalilfly]

Alright, IWM just busted through to the other side. Waiting to see if the 50 acts like a magnet or not...

[natsalilfly]

Jan 10, 2011 13:30:23 GMT -5 natsalilfly said:

Alright, IWM just busted through to the other side. Waiting to see if the 50 acts like a magnet or not...

thread foul!

[brosin]

Jan 10, 2011 13:03:40 GMT -5 jack said:

Dec 28, 2010 17:33:25 GMT -5 brosin said:

Follow up to.... www.fastopia.proboards.com/index.cgi?action=gotopost&board=brosin&thread=7377&post=88300

Only 4 months ago, FAS was around $17, the economy and stock market looked like a double dip was all but done, and it was incredibly lonely on the bull side. If you back up to the summer, I think I was one of the few who was still *long term* bullish, and even I was supremely tested. I was really torn for a couple weeks in Mid Aug (you can see it in my blog posts from those dates), and honestly considered whether my long term bullishness was wrong. At the end of the day (summarized on 8/26), I stayed bullish. Even in that thread, you can clearly see that not many agreed with me there. Hell I barely even agreed with myself (I had started my core FAS trade 2 weeks earlier and really felt as if I was going down with the ship)...

My point: now, 4 months later, no one wants to be out of stocks, I've never heard so many comments about 'easy money,' everyone is talking about the Fed/POMO/QE61346436/etc etc etc etc etc, and bullishness is at ridiculous levels judging by the VIX, put/call ratios, and AAII sentiment readings.

And the funniest thing to me? This is not even a new thing THIS YEAR!! We just went through this all in April (only to see 4 straight *brutal* months), where bullishness would not cease. It was dangerous then (as I clearly stated in my 4/13/10 post that this thread is a follow up to), and it is dangerous now. "Dangerous then" led to a flash crash. What will "dangerous now" lead to?

I am sure people will think this post is as crazy, stupid, foolish, whatever as they thought my bearish (4/13/10) and bullish (8/26/10) posts were... both ended up correct. I have been encouraging caution and selling into strength since 1220 SPX early in Dec even though I said I could see us getting towards 1240/50, so in that sense I have not been correct so far; but I had gotten a move from 1040 to 1220 (early Nov) correct on the nose, the move from 1220 to 1175 correct on the nose, and the move from 1175 to 1220 before then getting Yogi-ish. So I have zero problem missing this final 3-4%...


I am all ears as to why anyone is still buying at these nosebleed levels after the move we have seen. It makes little to no sense to me; and this coming from the guy who has been talking about a "historical" rally since Sept and Oct. It just can't happen when everyone is bullish though - quite the opposite.

Money's just starting to move into stocks from bond funds and the shoe shine boy on the corner of Wall Street and Bleeker hasn't yet given his latest stock pick to...Bernanke.

Its got some more to go.

The big time bond selloff has been happening since QE2 was announced in Sept, hasn't it? Kind of like how the dollar was supposed to get killed, killed, and killed some more.

Things got way overdone. The longer we go w/o a pullback, the bigger I think it is going to be...