Saturday, April 11, 2009

Correction, ongoing?

Sometimes things like this correction seem very puzzling.

The correction is ongoing, in time, and space but not yet in price. To put some perspective on this, recently I did a Fibonacci time series on some of my favorite indexes and I came up with HIGHS for April 20. So it seems to me, that the price segment of this Correction, might well manifest itself about that time. For certain, the Advances & Declines show no real sign of abatement of upside movement, nor do the price indexes. Does this mean, NO CORRECTION ?? No, Virginia, IMO, it means that the market will do whatever is necessary to fool the greatest number of participants.

A brief look at the VIRAL V1.3 $BKX projects a decline for the bank index after this April 20 top, so I will stick with the thesis that a decline is in store for the main indexes after Apr 20.

Probably a rally lasting to April 20 will fool quite a lot of people and the Talking Heads will help the MM's complete the distribution by opining that perhaps its now safe to invest. Oh well.

In a very real sense, I think we have seen a sea change and a range change since late 2008. Cant call it a bull market, but I can say, this market will no doubt clean your clock if your on the wrong side of the trend, and its inherent volatility.

A number of guru's are calling for a disaster decline and bottom in the fall, but I just cant see that far, so I will stick with my short term/ intermediate term scenario 2-4 mo out. As far as I am concerned,the Nightmare SCARENARIO, is always possible when investors are either complacent or overconfident, so be aware.

Happy Holiday.


1 comment:

VLB said...

Interesting your TA gave April 20. Armstrong most recent publication says April 19 is a major turn date.

Thank you for sharing your work.