Hal4511
June 18th, 2008, 10:10 AM
As some of you know I am a trader, there is a fellow I follow that really has things pegged, thought some of you might like to read his thoughts ...
(by the way I'm following his advice and stockpiling firewood)
Above is a chart of the Dow. It remains trading below all major moving averages (the 200, 100, 50 and the 30), all of which are downtrending. Only one thing could make this chart any more bearish than it already is, and that's a new low.
Our recent poll on the left side of the blog screen asked readers whether or not the Dow would break its January lows this year. We weren't suprised to find that the vote was divided pretty evenly. We voted yes. Here we are, midyear, and nothing about the economy has improved since January. If anything, things have gotten worse, and the "powers that be" have no intention of providing any real relief. Wasn't it just 5 years ago that Bush passed a tax law incentivizing people to buy the largest SUV's? Wasn't it around this time that the Honda Insight (at 70mpg, it put the Prius to shame) was mysteriously removed from the list of cars available to the American consumer? Current oil prices are enough to stop the U.S. economy dead in its tracks. For all of the media coverage it's getting, we feel that we haven't even yet to scrape the surface of the devistation it will have on the bottom line of just about every company this quarter. This earnings season you'll see company after company blaming their shortfalls on the crippling price of oil. We feel that analysts have estimates too high for Q2 2008. We'll find out in July, or even sooner if companies warn ahead of time.
Interestingly enough, our recent Ag trade was profitable despite taking place coincident with a 1,000 point drop in the Dow. We've learned to not let the broader market affect our trading decisions for this reason. We just buy at the bottom of the channels and sell at the top. The actions of the broader market do not factor into the equation. Still, it's fun to guess at its next direction. And despite billions of dollars sitting on the sidelines waiting to get back into the market, our vote is that we break 11,600/11,700 this year. Perhaps this earnings season. Or when the Fed decides the rates need to be hiked because despite the election, immediate action is necessary because the inflation picture is growing desperate... to be determined.
The market's current weakness won't end until at least one major airline goes under. That's been our prediction since our post on the cost of firewood doubling this winter, and we're sticking to it.
http://snotwheel.blogspot.com/
(by the way I'm following his advice and stockpiling firewood)
Above is a chart of the Dow. It remains trading below all major moving averages (the 200, 100, 50 and the 30), all of which are downtrending. Only one thing could make this chart any more bearish than it already is, and that's a new low.
Our recent poll on the left side of the blog screen asked readers whether or not the Dow would break its January lows this year. We weren't suprised to find that the vote was divided pretty evenly. We voted yes. Here we are, midyear, and nothing about the economy has improved since January. If anything, things have gotten worse, and the "powers that be" have no intention of providing any real relief. Wasn't it just 5 years ago that Bush passed a tax law incentivizing people to buy the largest SUV's? Wasn't it around this time that the Honda Insight (at 70mpg, it put the Prius to shame) was mysteriously removed from the list of cars available to the American consumer? Current oil prices are enough to stop the U.S. economy dead in its tracks. For all of the media coverage it's getting, we feel that we haven't even yet to scrape the surface of the devistation it will have on the bottom line of just about every company this quarter. This earnings season you'll see company after company blaming their shortfalls on the crippling price of oil. We feel that analysts have estimates too high for Q2 2008. We'll find out in July, or even sooner if companies warn ahead of time.
Interestingly enough, our recent Ag trade was profitable despite taking place coincident with a 1,000 point drop in the Dow. We've learned to not let the broader market affect our trading decisions for this reason. We just buy at the bottom of the channels and sell at the top. The actions of the broader market do not factor into the equation. Still, it's fun to guess at its next direction. And despite billions of dollars sitting on the sidelines waiting to get back into the market, our vote is that we break 11,600/11,700 this year. Perhaps this earnings season. Or when the Fed decides the rates need to be hiked because despite the election, immediate action is necessary because the inflation picture is growing desperate... to be determined.
The market's current weakness won't end until at least one major airline goes under. That's been our prediction since our post on the cost of firewood doubling this winter, and we're sticking to it.
http://snotwheel.blogspot.com/