Is the bear here?

Discussion in 'Stock Market' started by william the wie, Mar 9, 2011.

  1. william the wie
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    william the wie Gold Member

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    All markets have declines and all bull markets run into a 10% or greater decline to eventually end them in a bear market. I thought I would ask what people expect and why to see if the contrarian indicator still works.
     
  2. Mr. H.
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    Mr. H. Diamond Member

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  3. Toro
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    For it to be a bear market, I think the economy has to fade pretty badly.
     
  4. william the wie
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    william the wie Gold Member

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    Quite true but the lack of worry about a downturn scares me. Bull markets climb a wall of worry sucking in ever more optimists until no one is worried. Even gas prices are treated as an annoyance not a real market risk. That sounds toppy. Or hitting below the belt look at your own melt-up posts over the past year vs. your own actions. LEAP NDX calls and buying puts on the way up to lock in profits would have made you seriously rich if you had listened to yourself. But in the absence of a brag thread over making the Forbes list I must assume that was not the strategy you followed. That is the kind of wall of worry I understand but I don't understand this market at all.
     
  5. Toro
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    We might get a good shake-out. In fact, I think it would be healthy to get a 10%-15% decline.

    The end of QE2 at the end of June may be that catalyst. Or it may be this ME thing.
     
  6. william the wie
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    william the wie Gold Member

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    But I sure wish I could see either more worry or more one way bet BS:

    The only one way bet rants I have seen are in tax liens and gold bugs talking about the lack of pension fund exposure to precious metals. And given those two markets it sounds more like arbitrage of market inefficiencies than bubble talk.

    But as to serious worry of the end of the world as we know it variety the only place I see it is in the Precious Metals and Real Estate markets. I don't see any of that in equities and very little in the bond market.
     
  7. waltky
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    waltky Wise ol' monkey Supporting Member

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    Uncle Ferd says its a rough ol' world out there...
    :eusa_eh:
    Stocks tumble on job report worries
    May 5, 2011 -- A sell-off on Wall Street accelerated late Thursday as oil prices plunged and investors braced for the government's monthly jobs report. The Dow Jones industrial average (INDU) fell 140 points, or 1.1%, to 12,584. The S&P 500 (SPX) lost 12 points, or 0.9%, to 1,335. The Nasdaq (COMP) sank 13 points, or 0.5%, to 2,814.
    See also:

    'Flash crash' worries go global
    May 6, 2011 -- On the one-year anniversary of the infamous 'flash crash' that sent the Dow industrials plunging nearly 1,000 points in less than 20 minutes, questions remain about how prepared markets around the world are to stop a similar event.
     
  8. expat_panama
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    expat_panama Silver Member

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    Ah yes contrarian trading, that's what we're hearing so much about these days because the pack sentiment is exactly where we don't want to go --hell eveyryone knows that by now.

    Hmm, if everyone's a contrarian then I need to do the opposite and go with the crowd, and the crowd's all contrarians so that means I need to not go with the crowd but...

    I need a Tylenol.
     
  9. expat_panama
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    expat_panama Silver Member

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    We're seeing the same thing.

    I don't trade bull/bear markets (time frames in several month) but rather rallies and corrections (a few weeks at a time). We've been in a correction for about a week and this morning's futures hint we may be starting a new rally today.
     
  10. Toro
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    The market has been acting recently like it has been for the past year. We have these 3-5% pullbacks, the market stabilizes then moves higher. And every time it pulls back, angst stampedes into the market, traders buy puts and short, providing fuel to the next leg up.

    I'm wondering if the contrarian trade is for stocks to move higher after QE2 ends. It's not like it is an unknown event. And I don't think the Street is positioned for a big move up.

    But we are overbougt in the intermediate term.

    Oh and the ECRI WLI are accelerating.
     
    Last edited: May 11, 2011

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