Market is very over sold. A recovery should start next week specially as we enter into a seasonably strong period. Having said that, one cannot ignore the fact that an oversold condition always preludes a major crash. So, is (A) Market going to recover and continue to go higher, or (B) is this the beginning of another crash to retest the lows of last March? No one can answer that question with total certainty. It's a question of probabilities. To me (A) is more probable than (B) because of many reasons. The main reason is that Government and Wall Street will make sure a crash does not happen. At this point in the US and global economy, another stock market crash would bring on an unprecedented level of financial chaos which would be much worse than what we experienced from October 2008 to March 2009. No one wants that, but it doesn't mean that it could never happen.
This pull back looks like a typical pull back of a bull market. Steep, but short in length. SGS is still Long, but if there is no recovery next week, it will go Short. My plan is to follow my signal.
Saturday, October 31, 2009
What's Happening? ..... Market Oversold
Subscribe to: Post Comments (Atom)
Post a Comment