Monday, March 2, 2009

03.02.09 - In Like a Lion

Pretty obvious title, I know. Internals are all aligned to the downside to the extreme. Market watchers need to stop looking for a capitulation bottom. If you look at six-month chart of 52 Week Lows - Highs, you can see we have effectively been getting that on a rolling basis.

This market has no memory of how far down we've come. There is no such thing as "priced into the market." The only rule remains the only one that has worked so well -- Sell. And yet the Market P/E ratio remains stubbornly pegged in the mid-teens! Think about that. I note that the talking heads have reverted to calling support based on round numbers alone. Sorry I don't have more the for bulls today!


Anonymous said...

Jeff, I don't follow your Twit about "tick divergence" and "blowing the bugle". Are you saying that in the "old days" you would use the tick bounce as a sign of a reversal?

I always thought that on a trend day down one uses a tick bounce to reload for another run to the lows.

Jeff Pietsch CFA Esq said...

You are right and the two comments weren't meant to be related. Completely different line of thought -- in a bull market we might have called today a long swing opportunity. Thanks for allowing me to clarify through your question.