The Qs have now broken out twice in this rally. The first time was the breakout from the downtrend channel of the 2007 to 2009 selloff. The second breakout occurred around September 14 and is above the downtrend line from the 2007 high. This trendline will likely be support for any correction that follows later this fall. The most likely support zone is around the 40 area. Be cognizant of this before you get overzealous trying to short this market.
I'll have more to say in the coming weeks on the timing of the 10 month cycle and my expectations for the coming correction, some of which may be surprising.
6 comments:
Who are you calling a ZEALOT ? I'm only frothing at the mouth because i was guzzling http://farm1.static.flickr.com/43/123329463_351750a1db.jpg?v=0 Those are the empties.
from 9/25: "There are many stocks that are still showing bullish patterns." Foremost among them would seem restaurants & small cap banks (again).
Are there any other sectors performing better than those ?
Time to get off the snide. http://www.forbes.com/2009/09/28/hedge-funds-finance-markets-equities-launches.html
Wanna partner up ? I have some unique risk mgmt ideas.
I forgot to add (to restaurants & banks) brokers.
Any thoughts regarding those groups or even better groups ?
I certainly have some interest in the idea of starting a fund, but the bottom line is that it isn't going to be anytime soon. Until I've got my youngest kids off to college, it is just too big of a commitment.
Secondly, I don't think the hedge fund industry has yet seen the full backlash from what will surely come after the next big wave down into the 2012 nominal low, which means it will be 2014 to 2015 before the regulatory dust settles.
But I think anything worth doing is worth doing slowly. I have started 3 businesses, and I have many friends that have started businesses, and the most successful ones are the ones that went slow. The others crashed and burned.
That gives 5 years for planning. Which means 5 years to build the trading model, risk controls, marketing plan, etc.
Lastly, have you read the work by Todd Harrison on his experiences with Jim Cramer? A good read on the hedge fund world.
I hope I don't come across as being negative, because I am not. It's just that I've spent the last 20 years learning lessons that I care not to repeat.
Restaurants and brokers are definitely high on my list, but the restaurants in particular really need a strong correction. See my post on BWLD.
I am not making new purchase right now.
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