Do You Want To Catch The Knife?
October 9th 2008 02:03
I am not by nature a catcher of falling knives. That's what this market is and one can get badly hurt by going back in too early. Saying that, I was impressed by the charts over at Jesse's Cafe Amercain.. The charts of the Dow Jones Weekly average, the S&P 500, the Daily NASDAQ have all met their technical targets on the downside. Over at Mike Shedlock's site, he points out that the indicators have reached levels not seen since 1987:
Now. Adam Hewison of MarketClub had a p=0&l=0&campaignid=3" target="_blank">video about QID and suggested looking at it for a trade. If it moves up, the market moves down. Their monthly Trade the Triangles gave a buy signal on September 5th at 48.67. He expected QID to move up to 57. I just checked back on the video to see where QID is sitting today. We are now at 77! The Triangles are not giving any sell signal yet. So, back to the knife. It is still falling. (See Chart of QID)
It is easy to be bearish given the circumstances, but the fact of the matter is these indicators are so washed out and so low that the probabilities increasingly favor a sustainable rally.
Now. Adam Hewison of MarketClub had a p=0&l=0&campaignid=3" target="_blank">video about QID and suggested looking at it for a trade. If it moves up, the market moves down. Their monthly Trade the Triangles gave a buy signal on September 5th at 48.67. He expected QID to move up to 57. I just checked back on the video to see where QID is sitting today. We are now at 77! The Triangles are not giving any sell signal yet. So, back to the knife. It is still falling. (See Chart of QID)
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