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After five straight losing weeks for stocks following a 52-week high, more selling could be...

After five straight losing weeks for stocks following a 52-week high, more selling could be ahead if history is any guide. "The last time this happened, almost exactly 10 years ago, it marked an important turning point in the market," Jason Goepfert observes. "The persistent selling pressure was a sign of even worse things to come."
Comments (10)
  • Stone Fox Capital
    , contributor
    Comments (7164) | Send Message
     
    But nobody is suggesting buying the dips. Its just different this time.
    6 Jun 2011, 05:53 PM Reply Like
  • Michael Parmar
    , contributor
    Comments (240) | Send Message
     
    10 years ago at this time it was clear that we were headed into negative growth over the summer for Q3 2001.

     

    No one at this stage is suggesting Q3 2011 will turn negative.

     

    So, buy in the dips!

     

    (but be nimble :) )
    6 Jun 2011, 06:13 PM Reply Like
  • User 487974
    , contributor
    Comments (1105) | Send Message
     
    1294 in the S&P taken out today with conviction. If we break hard tomorrow, well lets just say it will be the bears turn. Risk reward is paramount to the downside. When the margin calls start to go out, liquidity will become king. Can you say Dollar strength? Deflation is so much more debilitating then inflation, what do you think has Bernanke so scared? Deleveraging will be begin again, beware the waterfall....
    Jerry
    6 Jun 2011, 06:35 PM Reply Like
  • Freedoms Truth
    , contributor
    Comments (972) | Send Message
     
    It's the high level of bearish sentiment like the above out there that kicks in my contrarian thinking. 9 times out of 10 a dip is a good buying opportunity.

     

    I estimate a 10% chance the doom-n-gloomers are right, 90% chance they are wrong.
    6 Jun 2011, 07:03 PM Reply Like
  • Bouchart
    , contributor
    Comments (820) | Send Message
     
    A couple of down days and there's panic? The Dow isn't even that far below it's high for the year.

     

    Seriously, I'm very bearish and all but come on. The bulls got really complacent and forgot that markets go down.
    6 Jun 2011, 07:25 PM Reply Like
  • anarchist
    , contributor
    Comments (1563) | Send Message
     
    "if history is any guide. "
    yes history is a guide, the market goes up, the market goes down etc. etc.
    6 Jun 2011, 07:53 PM Reply Like
  • Windsun33
    , contributor
    Comments (4326) | Send Message
     
    I am not sure what to think right now - some stocks seem to be getting ridiculously cheap, yet keep going down, like Corning (GLW). Others stocks that look awfully bubbly keep going up - it is more like this is a "flight to fads" than anything else. We all knew the housing market sucked, and will suck for years, so I don't think that is much of a factor.
    6 Jun 2011, 09:24 PM Reply Like
  • Hitesh Patel
    , contributor
    Comments (314) | Send Message
     
    The lights haven't even turned on yet at the party and everyone is running to the exists. Here are a few problems:
    1) Lowest cash on hand by mutual funds since 2007
    2) Extremely high levels of margin debt
    3) High insider selling versus buying
    4) QE2 ending in a few weeks
    5) Terribe economic data coming out
    6) Japan, greece, ireland, portugal, spain, italy, oil, margin compression, forclosuregate, etc etc etc

     

    Good luck to all the Longs and Shorts
    6 Jun 2011, 09:34 PM Reply Like
  • convoluted
    , contributor
    Comments (2206) | Send Message
     
    I'm looking at my notes from Dec. and early Jan. Quite a few "experts" were predicting upper 1400's-even a few close to 1600 (S&P). And, to a person, it was "time" for financials to outperform. For a while, that seemed to be a good bet. There was a brief moment when selling the Jan. GS 170 calls seemed a bad idea.
    A lot of stocks were lower a few weeks ago. I had hedged some energy stocks with ERY @16.50-still didn't get there today. With the advent of inverse ETFs, and the increasing acceptance of hedging by astute retail investors, it's hard to imagine a 2008 repeat. But, going back to GS, why wouildn't anyone with a substantial position simply collar the stock, or use FAZ (or both) as a hedge, and income source.
    Given all the articles and information regarding hedging over the past two years, it will be interesting to see if real panic selling kicks in. It's interesting that the VIX and related products were actually negative until the final downdraft. The most important call of the day may have been Bove's call re WFC. The financials had already been withering on the vine. For some reason, I think that call will have profound significance in the future. Bove had actually been fairly positive re banks for several months. To make such a call this late in the "recovery" suggests that a black-hole is looming somewhere. But, that's ok. Just realize that there is a vast arsenal to deal with those pansy sellers. And, if they want to contribute to my end-of-the-world fund, I'm not about to turn them down.
    6 Jun 2011, 09:59 PM Reply Like
  • Windsun33
    , contributor
    Comments (4326) | Send Message
     
    Guess what year this quote is from (not this year):

     

    "18,000 Jobs? Not Really.

     

    The Bureau of Labor Statistics put out its monthly employment report today. The consensus forecast was for 70,000 new jobs. BLS came out with only 18,000 jobs, promptly putting the market into a funk, with the Dow falling 256 points. Since the economy needs to create about 150,000 jobs a month just to account for growth of population, today's employment numbers are quite anemic. But it's worse than the headline number would indicate..."
    6 Jun 2011, 10:16 PM Reply Like
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