19 APR 2009, Sunday

1. Potential market paths: Saw this at Slope of Hope blog and I tend to agree with the negative outlook once this upside swing completes toward the SP500 mid 900's to the low 1,000. But he does point out the possibility of a bottom similar to the 2002-2003 bottom area. Possible...Ms. Market will have to show me and I will merely follow her as I always do...like a stalker. To fight her is crazy...you can only follow and survive. Markets can run higher (or lower) than you think for longer than you think possible when they get "emotional" (ie, fear or greed). So, don’t try to outsmart the market. Just take what it gives you and do the best you can with the data you have at the time.
2. Thomas Paine returns....
3. The scatter chart below shows historical bear market rallies (the 50% rally after the 1929 crash was excluded). As you can see, this rally is pretty stretched. At Friday's high, this was the third largest bear market rally in history. Many of the sentiment indicators are now at or above levels last seen at the May 2008 and January 2009 tops. Breadth in just about every sector, especially tech, is stretched higher than it was at the October 2007 top. This indicates that it is not necessarily a safe time to be buying.
4. 4 Year Cycle Low info...