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As much as I want to be more pessimistic, I somehow do feel that, this market could rally big any time soon.
Would the market go down another 10-15% from here before it rally? Sure. But we need to realize that, the market has been down stretch very much at this point. Well, of course, you can say that the market sentiment is still not bearish enough yet. From TA standpoint, we are in the cross road that we can either rally from here, or go down further before that rally happens. But couple of things are working in favor of the bulls at this moment:
1. Every single day, there are more and more bad news pouring into the market through the media talking heads(bunch of idiots who make money by trash talking, and misleadking the public), this leads the market into absorbing and discounting the bad news continuously. Eventually, the market will reach a point that, unless there are some catalystic events, bad news will be treated as, NON EVENT. People are numb. By then, all it takes a little drop of good news to trigger a powerful bear rally. Do you feel that we have seemed enough bad news these days?
2. Unlike 1929, the Fed and US are now doing whatever it takes trying to sooth the market and trying to make the boat floating. Given the fact that, US can print green back at will, you would never know what the crazy Fed will do the next. All these aggressive actions by the Fed and US government will eventually provide a floor of confidence to the market and restore some kind of market sense. That's why being too bearish at this moment can be very harmful.
3. For those who have seemed their IRA/401k losing 40%, if they haven't sold yet, they would stick to the other 10-15% loss and ride it out. After all, what's the big deal of another 10-15% after that big and scary 40% drop. That would lower the outflow of money due to the redemption, which would slow down the bleeding. Now, hedge funds might still have a long way to go before they are done with the selling. But unless they are all closing their doors now, otherwise, this phase of crazy selling due to margin calls and redemption could be close to be over, at least for this round.
Don't get me wrong. I do believe this market will go much lower before it's all over. However, I also believe that, we will have some very good selling opportunities down the road soon.
Cutting your losses at this time without waiting for a rally is plain stupid unless, 1. you use margin, or 2. you need the money to feed your family.
Cheer up and be patient waiting for the rallies. They will come. Any bear market comes with powerful counter rallies that will knock your socks off. This one will not be an exception.
来句狠话：要是这市再掉１０－１５％， 我不抄底，我对不起我自己。 | |
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