There is an old polish Proverb "under capitalism man exploits man, under socialism the reverse is true." Sadly, part of this appears right now to be all too true, as man exploited man in GREED, and led to this debacle.
After Tuesday's bull run, many saw it as a "bear market rally." With yesterday's trading we saw initial follow through at the opening, but the following may show us a bit of "why" and "what" is happening:
"To come up with a list of the exact days on which those bull markets commenced, I relied on the definition employed by Ned Davis Research, the institutional research firm: For them, a bull market requires one of three conditions to hold: (1) at least a 30% rise in the Dow in 50 calendar days, (2) at least a 13% rise in the Dow in 155 calendar days, or (3) at least a 30% reversal in the Value Line Geometric index. Since 1900, according to the research firm, there have been by this set of criteria no fewer than 34 bear market bottoms.
In nearly half of these bull markets, believe it or not, the Dow rose by less than one percent on the first day. That should put to rest the notion that bull markets always begin with huge powerful and exciting up-thrusts.
What is powerful and exciting, however, is a bear market rally. Consider the following factoid: During the Great Depression, there were a handful of calendar months in which the Dow rose by more than 20%.
The month with the biggest Dow up move, for example, was April 1933, when the Dow rose by 40.2%. In August 1932, furthermore, the Dow rose by 34.8%.
Now that is excitement. But, needless to say, those months didn't mark the end of that decade's bear market.
Another feature of Tuesday's rally that also doesn't seem quite right: It was led by financials. This is a source of concern because rarely does the same sector lead in two successive bull markets."
Interesting commentary above, and the market will hit many resistance areas. At the same time, many investors are "watching", using the historical data from 1932 when volume on the NYSE contracted to only 1 million shares a day. It was on the 7/8/32 that the Dow hit it's bottom (of interest, 41.22) and volume surged to 4-5-6 million shares as the market surged higher. A new bull market had started amidst the Great Depression.
What traders note is "where did all the money come from" then, and noted how fast the market turned. When the price is right, the money will be there.
This is what the market waits for, and the talking heads, newsletters and analysts babble about. No one knows.
The market topped at 7050, right at our resistance lines, before falling again. Day traders reported good tight trades on our recommended no more than two day signal, the March 350C.
Up to $1.00 a contract profits were possible several times, and even tighter profit trades. We'll list as an open signal today for any traders still holding.
And, as contrarians, we'll list the possibility of downside as we have now hit resistance lines; study our updated and lengthy Dow projections listed below as puts have a good chance of a doubling unless we see more strength to the upside today.
Floydian Therapy:
Author Elizabeth Garret writes in Eat, Pray, Love that each of us, and even cities, have a WORD. For example, her word for Rome is SEX. Her word for NYC is ELECTRIC. What takes it a bit farther is if we are able to find the word that defines who we are, such as your own identification of what you see yourself as.
As an example, one of my clients is a SEEKER, another a CYNIC, another CONFORMER.
Identification of self helps one to create self.
Join me if you are interested in Private Counseling with Floydian Therapy:
Write me at : floydiantherapy@gmail.com
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