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Caution Warranted Despite Full Spectrum of Bullish Indicators Worldwide

What makes you think today there is "universal bullishness"?

On Aug 07 09:00 AM Moon Kil Woong wrote:

> As when people turned universally bearish the market hit bottom likewise
> we should be concerned about universal bulishness. After the last
> market collapse you would think that was fresh in everyone's mind
> but it appears not to be. Although I'm not a contrarian because momentum
> can last a very long time, I am not a momentum player eaither because
> it often masks the market dynamic truths that sooner or later get
> rectified.
>
> Likewise, I hate overpaying. Perhaps that's why I haven't been buying
> new positions since about April. As Aristotle once said, moderation
> in all things. Don't get lured in after the markets rise.

Global Markets July Review: Rally Without a Cause?

And if you wait to get in until you finally see all the positive signs that you're looking for, you will be too late. Most of the move up will have already happened. To make real money on the long side you must anticipate positive signs before actually seeing them.


On Aug 02 03:01 PM whidbey wrote:

> The sentiment seems to come from the fear that a recovery rally is
> due now. It is buying on hope and fear of missing the start of a
> bull market. It is also....too early.
>
> Clearly we have standoff on sentiment with those saying no recovery,no
> bull, winning the event for this year and maybe the first half of
> 2010. The Administration will very likely push for another stimulus
> this fall, but this time focused on small business and jobs.
>
> About 12 months after the second stimulus bill we will have a standoff
> between national bankruptcy and recovery: which comes first ? The
> Chinese think a US recovery is there if it is pushed hard.
>
> In the best of cases 2010 will be recognized as unsure and not vigorous.
> That puts a lid on the market for the next six months. This will
> make Obama nervous since elections require results very soon in 2010,
> he needs to hold onto the House.

Global Markets July Review: Rally Without a Cause?

"Given that stocks and other risk assets have risen substantially over the past weeks with questionable justification, a pullback would be the likely result."

The tape is always self-justifying. Of course it's "questionable", it's always questionable. For months, longs have been making bets that the "questioners" were too bearish. Those bets were correct, as things stand today. The people continuing to say that the rally has no basis don't get it. The rally thus far has mostly been due to refutation of the ultra-bear case. The baked-in pessimism of early 2009 was overdone, so the bid came back, as we've clearly seen. The reason for the rally from March to today is settled, but that issue has decreasing relevance. The question today is whether the bid will weaken from here. That's the basis for today's bets.

Michelle Caruso-Cabrera, Charlie Gasparino Bash Finance Blogs

I'm very much amused at the enormous amount of sputtering, juvenile hatred directed toward something nearly all the sage commenters say is unworthy of serious attention. Ok, I get it. I really, really do. You don't like CNBC and think they're shills for Korporate Amerika or something, constantly cheerleading for the long side. Fine. If you're of this opinion, why bother with it? You have your own favorite "news" sources that confirm your own worldview, so GO THERE. Judging from conversations with friends, the main reason for the hysterics is because so many people never know when to sell, and want to blame somebody else for it. Nearly every one of the people I know who share the anti-CNBC view are the types who have been fully invested during the selloff of the last year. Investing is not for the lazy. If you don't want to do your homework, you have to take your lumps, if somebody else is pulling the trigger for you. What, you didn't realize that your favorite fund is never going to advise you to get out of it? There are lots of sharp, bearish folks on CNBC who recommend raising cash from time to time. Oftentimes they turn out to be right, and sometimes very right. What, you didn't listen to them, and neither did the guys running your fund? You need to find a game you can play, not whining about how things work.

As the Market Dips, Where Are the Buyers?

What nobody seems to be talking about is Waxman-Markey. Positioning ourselves for the vote Friday, is there a Cap-and-Trade trade, and if so, what is it? This vote is likely to trigger a sizable move up or down.

How Today’s 2.46% Dividend Yield Could Destroy Your Wealth

" if stocks do indeed go that high, it will only be a signal to tighten my stops"

Oh, so Chris the Boy Wonder will have been long between now and then. Long in what, pray tell? The thrust of the initial paragraph is that he doesn't believe the rally. Ok, so what is his equity exposure today, 0%? 50%?

If anyone is 100% long now and collects a 2.46% yield between now and the time the DJIA is 12500 their yield will be more than 25% if it takes 2 years to get there. So we are being warned to avoid this strategy in favor of doing what?

Financials: Bottoms Happen When Everyone's Convinced They Won't

TB has it exactly right. At this stage of the game, people should be nibbling, instead of quibbling. But some never get it, no matter how many market cycles they see. If the nibble turns out to be a bit too early, then fine, retreat and wait for a better entry point. If the first nibble shows a significant gain, nibble further, etc. This isn't rocket science. It's not about never taking a loss, and only jumping in and out with both feet at precisely the right time to show everybody what a genius timer you are. It's about building (or dismantling when required) positions in the same direction that price movement occurs. Doing things this way will ensure you are long in bull markets and out of bear markets.