3SOF

Quote from: terainvestment on January 04, 2008, 02:48:36 PM
just great entry points for us!

stay tuned ;-)

I agree good entry point.
Tell me what you think, anyone? Look at the DDM -  Ultra Dow 30 ProShares Fund
We are getting close to 75.65 range, maybe a few more down days. This was the low March 07.
I know past performance does not guarantee future results, but I think a bounce is in the near future. jmo

la-onda look at the UltraShort Russell 2000 Fund. They all look up.
What goes up must come down. 
I am sorry for your loses today. And I am sure you do not want to hear any news of a bounce, especially from a dumb blond.
By the way, I love your input and sharing of knowledge on the forum.

Quote from: BigSully1 on January 04, 2008, 07:29:13 PM

I sold all US holdings except for GSB, the rest remaining are my Chinese or Israeli holdings.  

Tokyo what you said brought a funny, or very sad (depending on how you look at it) thought to mind. It used to be when there was trouble with the U.S. economy, the first thing we did was pull out of emerging markets as they were considered very risky and were severely effected by our economy. Nowadays we tend to seek safe haven in the emergings markets when trouble brews here. Geez, how times have changed.


[/quote]

Heh, well not sure I am doing the right thing, but that is just how it all played out.  But it was the jobs number in the US that brought this on today, and foreign stocks like SDTH and CIMT have been doing great or at least fine despite the market downturn.  GSB also wasnt getting hit much, though CHME was starting to hurt again.  I got into UTVG really low so still gaining there, but since its recent I feel less tied to it than others and could jettison it with an eye to buy later.  GIGM I had but David called the sell so it was gone before today. 

I didnt sell anything during the last correction, but considering this rally didnt last but for a few weeks, I dont plan to be as cavalier this time around.

Anyway, will watch the IBD recap and think about this over the weekend.  Here is what IBD has to say in the meantime (as expected they say the market is back in correction):

-----------------------

Stocks Dive On Jobs Report As Correction Takes Hold
BY JONAH KERI

INVESTOR'S BUSINESS DAILY

Posted 1/4/2008

Stocks plunged Friday, as a weak jobs report served a knockout blow to the market's ailing rally.

The Nasdaq gapped down at the opening bell, then closed near the day's lows, sliding 3.8%. That marked the Nasdaq's biggest single-day loss since February.

The S&P 500 swooned 2.5%, the NYSE composite 2.3% and the Dow 2%. The IBD 100 slid 4.2%.


Volume surged across the board, the latest bout of distribution for a market that racked up multiple higher-volume sell-offs the past couple of weeks.

For the week, the Nasdaq skidded 6.3%. The S&P 500 dropped 4.5%, the Dow 4.2% and the NYSE composite 3.8%. Top-rated stocks tracked by the IBD 100 slumped 5.1%.

Those losses confirm that the market's in a correction. Today's Market Pulse notes the change.

When stocks move into a correction, there's only one sure way to protect your capital: cutting losses and moving to cash. At a minimum, that means selling any stock that's fallen 7% to 8% from your initial purchase point.

This is exactly the sort of market situation that demands such discipline. All big losses begin as manageable declines, whether for the broad market or your portfolio.

If you sell a stock when it drops 7% from your buy point, you need just a 7.7% gain to get back to even.

If you let that loss grow to 25%, you'll require a 33% profit to get back to even. A 33% loss requires a 50% gain to even the score. Let a loss swell to 50%, and you'll need a 100% gain to return to square one.

At the start of a correction, you don't know how deep the losses are going to go or how long they'll last. Taking a defensive stance protects you against that uncertainty.

Being an individual investor affords you the luxury of buying during bull markets and staying high and dry when things turn for the worse. In 2007, growth investors who jumped into institutional quality leaders during the brief rallies, then cashed out when corrections hit, netted solid profits.

If you feel you absolutely must own some stocks, look to defensive names. Coca-Cola, (KO) Colgate-Palmolive (CL) and other defensive stocks have held up well. Fund managers often rotate money into such stocks when the market falls.

The December jobs report showed a gain of just 18,000 jobs, well short of the projected 70,000-job bump. The unemployment rate spiked to 5%, above the expected 4.8% figure.

Futures traders are betting on a bigger rate cut at the Federal Reserve's next meeting. The odds of a 50-point cut are pegged at 68%

-----------------------------------------------

An emergency rate cut before the next meeting would be great, but I dont see it happening personally.

Anyone know what Cramer is saying about the chances of a rate cut, somehow he is pretty accurate on those IME?

This is what I found on another service.
"Watch GS, the way Goldman Sacs goes so does the market"
"If the financials keep going down the lower the market will go"

He told his group to go to cash in December right before the year was over and go short.

http://www.investors.com/mediacenter/MediaArchive.aspx?t=v

They mention a stock called IRIS, might be worth checking into... 

Otherwise though, they recommend not buying new stocks as usual during a correction and looking for rally attempts.  Clearly rate cuts will bring rally attempts, the question will be whether there are follow through days afterwards to get the market back into full rally mode.

shadowtrader update:

http://www.shadowtrader.net/videos/sunday010608st2.wmv

Interesting read from Yahoo MB on the QQQQ's, I have this bad feeling about the markets in the U.S. and eventually abroad, the same feeling I had in Dec. 1999, but for different reasons.  I know David is investing for the long term, but Cash is king sometimes.  I may miss a bounce on a Fed cut, but for know I'm out of the market with a good return for the year.  (I just want to preserve my capital)  Will wait for the clouds to clear for a jump back in, it's going to have to be a "I know that I know revelation when I re-invest."  I will still subscribe to 3stocks, because David is one of the best and I respect his views.  GLTA, cheers, Ellen

View all Topics | View all Messages   < Newer Topic | Older Topic >
TRUTH SERUM: 2008     24-Dec-07 02:58 pm   
Don't be delusional...

- If real estate and related garbage accounted for ~30-40% GDP growth in the last five years is smelling like shit it is bound to have ramifications that are going to be painful...

- If financials at ~20% to 25% of S&P 500 are getting destroyed by real estate and related derivatives kryptonite it is bound to squeeze the shit out of the American Eagle in every quarter as credit contraction takes hold...

- If corporates are at the peak of their profits and that the business cycle is tipping downwards, cheap talk on valuations being cheap is nothing but intellectual prostitution.

- If consumers at ~72% of GDP is with zero savings and loaded to gills with debt, and the housing ATM machine away, and job outlook weakening by the minute are hurting despite forced smiles at Christmas dinner tables it is bound to bound to destroy the lazy and zero IQ society that USA has become.

- If corporate balance sheets - are being destroyed as in the case of financials; - are being frivoulsly used to repurchase stock to offset generous options dilution as in the case of technology companies; - are being used to dole out generous dividends in the case of consumer companies; - are being used to fund expensive new drugs/new fabs with nothing much to show in the case of drug /semiconductor companies; and being used as a source of cash to meet working capital obligations in most cases in the face of credit contraction; it shows there is no hope for stability, and little faith in profitable growth.

- If credit markets are in a deep freeze, consuming anti-freeze in terms of Arab, Chinese, Singaporean, or local funding on onerous terms is not going to cure the loss of trust in corporate balance sheets that are laden with toxic garbage.

- Fraud Engineering Department (FED) can accept garbage as collateral but it is garbage on it books at the end of the day; ECB can inject $0.5 trillion in ready credit but LIBOR knows it is liuidity/credit is not the issue. Cost of capital can be addressed in with various capital structures, but cost of garbage and price for garbage always ZERO!

- If stock market on its most logical day has an IQ of 70, there is no ned to analyze it logically to the nth degree but trade the hell out of it based on the magic show being enacted.

- If stock market participants look so glum to you at just a few percentage points of the peak of many indices, imaginw waht it would be likw when the indices and their components are off 30% or greater?

Enjoy your Christmas dinner, for I will assure you that truth serum will enter your blood stream and your brain cells shortly afterwards...

I think its time again for David to post the 90-91 recession with what happened afterwards chart again. If you are really long term investor [more than 1 to 3 years] you should not be worried about the current flux. However, for short termers it is time to be cautious.

One more thing. David has more experience and better record than anyone of us. But his outlook is much longer term and you need to have the same outlook if you want to replicate his performance. Now if you are buying with David and selling b/c market is looking bad then you may underperform.

To know your time horizon is as much important as picking the right stocks. Decide this first.

from IV:
Friday was a nasty day for the ages.  Nothing but down.  The volume was high at 2.5 billion with a ratio of 13.6 to 1 – no typo folks.  No wonder we lost 100 points.  Anyone that had any profit cashed it in.

The daily channel chart is dismal – no other way to describe it.

The hourly charts are also dismal and basically unusable at this point exceprt for upside resistance.

The ratio chart sided with the bears and has gone into bear crossover mode.

The weekly chart is not dead but it is hurting real bad.  2500 is the line in the sand.

Again, the Wilshire did not get hit as bad as the NAZ but it was ugly anyway.

The P&F is showing a NASTY double bottom breakdown.

I went 30% long QID on the 10am breakdown and sold it near the close.  If we had been down 50, I probably would have held it but a day like Friday is nothing to mess with.  This is a very dangerous market for both bulls and bears.  There is a reasonable possibility of a strong pushback or a further challenge to the 2400-2450 range.  I don't know which will transpire but I do know what Friday was all about – it was heavy profit taking.  There was some fear mixed in and the big bulls need to start putting on the breaks to stabilize the situation.  Otherwise, it could turn into pure fear.  Let's see what happens tomorrow.

Charts link below.

http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID2071209

Have a good evening,

The Old Fool

Well, the sky is falling, AGAIN At least according to some pundits.

I live in NY State, US. We are a rust belt State and the area outside of NYC has seen the bulk of the old time industries leave the area. We have never been a high growth area in the last 50 years. Would you like to know what an article on the front page of the local Buffalo paper was talking about? It talked about how the Albany,NY region was booming. Our local economy is stable, but things are beginning to happen. Hundreds of millions in water front development are underway. The housing market is steady and progressing about the same as it has always been. A couple of real estate agents I know had all time record years. The small town I live in had  about 250,000 visitors to a local summer theater. There are several housing developments underway. Qualified buyers are getting mortgages just fine. There are no big new unemployment lines, even though the employment market has been soft for as long as I can remember. there is no panic or pervasive talk about loosing jobs as there has been in past recessions.
There are forecloses and, periodic announcements of job losses (and job gains)  The high price of oil is eroding discretionary income, but it hasn't stopped people from filling the stadium for a loosing football team or even for a Jan 1 outdoor hockey event. People are living pretty much the same as always.

I don't believe that we are alone in this outlook. The Midwest is flush with corn money, as one example. Our idiot president will be gone in less than a year, which will create a new foreign policy, stimulate the whole scientific/technology areas such as stem cell research, green energy industries, and even the antiquated US auto industries may finally be forced to modernize their thinking.

I see financial's in trouble, but don't see a "credit crunch" which is a different animal altogether. I see certain over heated housing markets, where values have tripled, retrenching 10-15%. Painful for some individuals, but not "the end of the world as we know it"  Good buying opportunities for the millions of first time home owners out there.
Inflation is moderate, especially outside of the energy sector.

Will the market continue to be volatile, probably. Will it have a downward bias, sometimes. Will there be trading opportunities, yes. Will there be investment opportunities, absolutely.

My advice for 2008 to myself- stay calm, keep a clear head. Chicken little has never been right before and there is NO evidence that he will be this time.   

Quote from: tokyopua on January 05, 2008, 02:38:15 PM
http://www.investors.com/mediacenter/MediaArchive.aspx?t=v

They mention a stock called IRIS, might be worth checking into... 

Otherwise though, they recommend not buying new stocks as usual during a correction and looking for rally attempts.  Clearly rate cuts will bring rally attempts, the question will be whether there are follow through days afterwards to get the market back into full rally mode.

IRIS is making that breakout attempt. new high.

We're starting to see a pretty good divergence between the Nasdaq and and the China markets.(and I understand the Nasdaq has been hit the hardest...down 7 days in a row ...we probably will see a rally Tuesday )

Take a look at the 5-day charts...when the U.S. markets started dropping and the China markets started to rise.

This is the signal toward the global story...I think we need to see if we want to move higher.

old fool from IV:

Old Fool Notes - 01/07/08

I was reasonably impressed by the NAZ action today - the bulls did not throw in the towel.  At the same time the Dow and broader market advanced a bit.  Nice bottoming action across the board.  Volume was 2.6 billion with a ratio of 1.6 to 1 in favor of the bears.  About right for 5 points.  No rush - I expect slow motion action here.

The bears still own the daily channel chart and there is little justification for fighting the tape.  The bulls do not need to fight hard - just hold her steady.

The hourly charts show a bit of bottoming action and we were able to drop in some new support and resistance levels.  No rush is the message here.

The ratio chart perked up a bit but the chart is still in bear crossover mode.  But not very strong in either direction - neutral.

The weekly chart has, once again, flipped the channel to the bears.  At the same time the indicators are in bottoming mode.  So - neutral.  This chart clearly suggests that the bulls need to push fairly hard this week.  That is somewhat inconsistent with my concept of slow motion action and is a bit of a conundrum.

The Wilshire turned in a slightly positive day.  That's about the fourth day in a row it has outperformed the NAZ - and it certainly needs it.  Neutral.

The P&F chart added another 2 Os to the double bottom breakdown on the early move down.  Not a favorable chart.  The bulls need to get with the program.

No trades today - much too busy to play.  However, if you were inclined to day trade, it may have been a very good day.  The action was fairly furious.  Overall, I interpret the action as favorable for the bulls moving forward.  They will have to reinforce the action over the next few days in the face of continuing downgrades by the big houses.  Can they stand the pressure?  I don't know.  We will see and in the meantime, I will just hang out.  Danger for both bull and bear still exist and there is no sense in rushing.

Charts link below.

http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID2071209

upside down W formation?
http://books.google.com/books?id=Xu1QwIwCJdQC&pg=PA626&lpg=PA626&dq=upside+down+w+formation&source=web&ots=H6IGvhTMt8&sig=9DKvfVnf4IEWyCrSZEOp7HY-kCE
When a Relative Strength Index Line spikes down and penetrates 30 on the Index Scale, then moves up, then is followed by another down spike (less than the first), a buby signal is generated as the index line rises to a level equal to the middle of the "W" Formation. A sell signal appears in a similar manner, but spiking up rather than down (an upside down "w"), above 70 on the index scale.

Do you ever wish sometimes the market would just close...instead of selling off in the last hour.

Down 8 days in a row now with the Nasdaq.  Hasn't happened in years.

Ouch, crazy day.  I had weak hands yesterday and sold more stocks, I am down to CIMT, CHME.OB and UTVG.OB.  I am really tempted to buy some back for a bounce, but with days like this I am still not sure what is up with this crazy market.