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Alex Filonov
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I was born in 1956 in USSR. After graduation from college in 1979 I worked full-time as an IT specialist. Until 1990 I worked for different companies in the Soviet military industrial complex. I created a small software business in 1991, which failed in 1993. I worked for Oracle Corp in 1995 in... More
My blog:
Muddling Investor
  • I Don't Like This Tape 1 comment
    Oct 10, 2012 6:19 PM

    Head and shoulders pattern in Nasdaq Composite worked. Now we have another technical level: 3050. This support level is working since mid-August. But I don't think it's about technicals this time.

    We had a good rally. Everybody hated it, so it worked. Now some people are liking it. Scary. Jim Cramer thinks that we are going to see a rally in "anointed" stocks into the year end. Maybe. But most obvious patterns usually don't work, just because everybody expects them.

    What I don't like is the action. For the last three months, sell-offs have been stopped in the end of the day. This week it didn't happen. Earnings season started, nothing exceptionally bad is reported, market is still in red. That's very bearish.

    Several things are widely commented on, and comments are all wrong, from my perch. Yes, QE3 started, and it wasn't expected. Well, we had a rally after that, but QE3 itself is not big enough to trigger a big rally. Yes, Europe is not going to fall apart any time soon. But they are not taking any decisive actions either. So there is no good catalyst for a rally right now.

    We still might have a good rally in the year end. It might be triggered by election results (if Romney wins, somehow he is considered good for business, I've no idea why). It might be triggered by window dressing by funds, they missed most of the year's rally. In both cases I will be selling some of my positions. On the other hand, if current bearish action continues, I'll be tempted to by something. I prefer to buy low and sell high, not the other way around.

    Themes: Market Outlook
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  • sundate36
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    Comments (291) | Send Message
     
    I agree... Today, for example, consumer confidence is up and the market spikes and then dwindles down. It looks like we are going to drift lower in an orderly way....
    12 Oct 2012, 11:17 AM Reply Like
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