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The resistance zone at 5132 is too big to have heavy positions right now. The next intermediate cycle correction in either early May or later in the summer will be the real buying opportunity.
If one can just have the patience to wait for it you can make your year in 6-8 weeks coming out of an intermediate bottom.
Or make even money by shorting the top (not for the feint of heart or feint of wallet though…lol)
Pretty dangerous with the Fed protecting the market. IMO
I get worried when bear orientated folk wait for the next buy more than the short. With that being said, the essence of this market is still a bull. That’s one thing I remember from “Confessions of a Stock Operator.” He said always get a feel for the market’s essence, and then only trade it in that direction. In other term, never short a bull market (even at oversold conditions).
Correction: “(even at an overbought condition)”
I have learned that lesson the hard way. Forget shorting. And forget buying this late in an IC. I know how the market feels as well as the next guy. I am dying to get in. And I will – at the next ICL. Even if I have to wait months. Nailing it just right – or even within a couple days – is worth the wait. You only need 1 of those ICL bottom trades per year if you are patient until it is time to buy, and then greedy as hell at the opportune moment (with apologies to Jack Sparrow).
On the BBC this morning they just said that the last time the NASDAQ was at this level it fell 80% over the next 2 years.
However, they also said that in inflation adjusted terms it is still 27% below the highs.
Of course the market could just go parabolic without an ICL. That’s what happened in 1999 with the NASDAQ. And when it crashed in 2000, it just crashed.
Wasn’t there a biggish correction in 1998 and then it went crazy in 1999 to new heights before the bigger crash?
Yes, you are right. There was a long drawn out summer bear. But once it turned, it never looked back. I am not saying that’s what could happen, but the market has been consolidating the last few months. That could be enough.
Isn’t that what Gary has been saying though – we get to new or near new highs on the NASDAQ, then we get a correction of 5 to 10 percent and then the NASDAQ goes nuts and races to crazy new highs?
Then we get a big crash.
Yes, I agree. The only thing I’m adding is the possible scenario is that we don’t get the 10% correction since the market has been consolidating since last fall. I still think Gary’s scenario has a higher probability.
I hear what you are saying and, yes, it worries me that it does not correct first and we just sit on the sidelines watching it going higher and higher.
Fingers crossed it drops 10% next week after Apple is out of the way.