I think the BULL Market is NOT dead…it’s only in a badly needed correction to shake out the weak hands and allow smart traders the chance to re-position into some great long positions. I had 6 different bids up on Friday to try and snatch some stock and calls on the cheap…three of those bids hit…plus I snatched up a couple stocks at the price they were going for, like XXX.
XXX is quite a bargain in the low 6’s…incredible!
I also think that Monday, or Tuesday at the latest, will give us a BIG Rally…I outlined that before on Friday night on another forum with some strong technical signals I follow.
Also, looked at my long term Dow Chart this evening…
1) Noticed the Dow is still in the upper half of the FIB congestion area
2) Noticed that it is firmly within its Bollinger Bands
3) Noticed the Major Downtrend Line from Oct. 2007 is still serving as support on the preferred Log chart!
…There is not much here to make me run in fear. This is OPPORTUNITY to grab great stocks and ride the bull further…but be prepared for a rocky ride this week…it won’t be easy, but patience should reward the prudent investor and the savvy trader…
So use good buying judgment…buy quality, not junk at this point in time–don’t bet the farm–use hedges when appropriate …try and put in low bids and sit back and catch these gems at good prices.
BTW, I was doing some research on the fundamentals of the stock market yesterday…note the S&P earnings will probably be about $86 this year…the original forecast a year ago called for about $70. Note that next year’s conservative earnings guess is $95–that was where we were back in 2007…if that holds true, then the Dow and S&P should both eventually SMASH through the Fib 61.8 resistance and head higher!
I am also finding some fabulously under-priced stocks on a forward earnings basis! Some of these stocks had low forward PEs to begin with, and after last week’s thrashing, they are even cheaper! There are plenty of bargains to be had in this bull market yet! So long as Da Boyz don’t let the panic get out of control! Lol.
If I am wrong about this NOT being the end, then I will know it soon enough…we are nowhere near the run for the hills sell signal like the one I gave to my followers back in August 2007.
But in my views, the Bull is still alive…but only taking a breather to get rid of some of the johnny-come-latelys who showed up to go long after betting against this bull for a year!
In fact, this is the best thing that could happen!…let’s get these johnny-come-latelys back on the BEAR bandwagon or the Fear bandwagon where they cried and moaned while I was making money…that was the fuel we have used in this “climb-the-wall-of–rry Bull market”…and I’m thinking we are getting that fuel back again! Hallelujah!
(Editor’s Note: ACE made the call brilliantly! The Dow had it’s 3rd biggest rally day ever the following day…up over 400 points!!!)