Cult of the Bear: Getting to Dow 6800

Very interesting article on 2006 DOW prognosis here:


It is very contrary to the current market mood. Well..., not counting
this last Friday. The argumentation is very convincing and hard to
argue with. It is mostly based on analysis of the long term DOW charts
The only thing I disagree with is the timing part - the
author predicts it to happen in 2006, which is IMHO too exact.
While I agree that DOW will be at 6800 at some point in next few
years, it might not happen in 2006.

IP.

Re: Cult of the Bear: Getting to Dow 6800

I'm not one to pick numbers like Dow 6800 but I think we will see stock
prices much weaker in the mid-year.
If the market does get the big run up first it will put us in "this is too
good to be true" territory and it would be contrarian to start taking
profits but this is almost always thw way to go.

My 'prediction' for 2005 was that the markets would finish higher than they
started the year. It wasn't by much but they finished a little higher. For
2006 it's a little tougher but I think it will happen again unless some
geo-political event changes the landscape. If prices do fall substantially
this summer I'll be loading the boat.




"IPavlov" <> wrote in message
news:dKGAf.15262$
> Very interesting article on 2006 DOW prognosis here:
>
>
> It is very contrary to the current market mood. Well..., not counting
> this last Friday. The argumentation is very convincing and hard to
> argue with. It is mostly based on analysis of the long term DOW charts
> The only thing I disagree with is the timing part - the
> author predicts it to happen in 2006, which is IMHO too exact.
> While I agree that DOW will be at 6800 at some point in next few
> years, it might not happen in 2006.
>
> IP.

Re: Cult of the Bear: Getting to Dow 6800

Does this sound like ramblings of a madman:

The lack of a 10% correction reveals high levels of complacency -- something
the CBOE Market Volatility Index (VIX) has been implying for quite some
time. This creates "air pockets" -- soft spots in the base of support that
can potentially become more vulnerable to selling in the event of a test. As
the 1966-1982 chart shows, broad trading ranges typically experience much
greater than 10% corrections. Considering how regularly markets pull back
and test support, the longer we go without that 10% correction, the greater
the possibility of a steeper and deeper downturn.

What are "air pockets?" What are "soft spots?" What is "base of support?"
What does it mean to "test support" and who is the proctor? How is
complacency measured? Did we not just have a big correction called the
bursting of the tech bubble? I wonder if Barry predicted that?

You can ALWAYS find someone with purported stature to predict the market
moving in each possible direction. If the market does tank, then Barry will
appear to be a great prognosticator that investors ought to take note of
when he speaks. If the market does not go the way he predicts, the article
will soon be forgotten, and he will most likely forthwith come out with
another prediction (if at first you don't succeed......). The market could
go up or it could go down, but it's good to know that Barry has meet his
article quota this month.





"IPavlov" <> wrote in message
news:dKGAf.15262$
> Very interesting article on 2006 DOW prognosis here:
>
>
> It is very contrary to the current market mood. Well..., not counting
> this last Friday. The argumentation is very convincing and hard to
> argue with. It is mostly based on analysis of the long term DOW charts
> The only thing I disagree with is the timing part - the
> author predicts it to happen in 2006, which is IMHO too exact.
> While I agree that DOW will be at 6800 at some point in next few
> years, it might not happen in 2006.
>
> IP.

Re: Cult of the Bear: Getting to Dow 6800

I think the market will go up unless something happens causing it to go
down. We finally agree.


"Ed" <> wrote in message
news:
> I'm not one to pick numbers like Dow 6800 but I think we will see stock
> prices much weaker in the mid-year.
> If the market does get the big run up first it will put us in "this is too
> good to be true" territory and it would be contrarian to start taking
> profits but this is almost always thw way to go.
>
> My 'prediction' for 2005 was that the markets would finish higher than
> they started the year. It wasn't by much but they finished a little
> higher. For 2006 it's a little tougher but I think it will happen again
> unless some geo-political event changes the landscape. If prices do fall
> substantially this summer I'll be loading the boat.
>
>
>
>
> "IPavlov" <> wrote in message
> news:dKGAf.15262$
>> Very interesting article on 2006 DOW prognosis here:
>>
>>
>> It is very contrary to the current market mood. Well..., not counting
>> this last Friday. The argumentation is very convincing and hard to
>> argue with. It is mostly based on analysis of the long term DOW charts
>> The only thing I disagree with is the timing part - the
>> author predicts it to happen in 2006, which is IMHO too exact.
>> While I agree that DOW will be at 6800 at some point in next few
>> years, it might not happen in 2006.
>>
>> IP.
>
>

Re: Cult of the Bear: Getting to Dow 6800

"NoEd" <> wrote in message
news:
>I think the market will go up unless something happens causing it to go
>down. We finally agree.

We can't agree, you're a contrary indicator.

Re: Cult of the Bear: Getting to Dow 6800

"NoEd" <> wrote in message
news:
> Does this sound like ramblings of a madman:
>
> The lack of a 10% correction reveals high levels of complacency --
> something the CBOE Market Volatility Index (VIX) has been implying for
> quite some time. This creates "air pockets" -- soft spots in the base of
> support that can potentially become more vulnerable to selling in the
> event of a test. As the 1966-1982 chart shows, broad trading ranges
> typically experience much greater than 10% corrections. Considering how
> regularly markets pull back and test support, the longer we go without
> that 10% correction, the greater the possibility of a steeper and deeper
> downturn.
>
> What are "air pockets?" What are "soft spots?" What is "base of
> support?" What does it mean to "test support" and who is the proctor?
> How is complacency measured? Did we not just have a big correction called
> the bursting of the tech bubble? I wonder if Barry predicted that?
>
> You can ALWAYS find someone with purported stature to predict the market
> moving in each possible direction. If the market does tank, then Barry
> will appear to be a great prognosticator that investors ought to take note
> of when he speaks. If the market does not go the way he predicts, the
> article will soon be forgotten, and he will most likely forthwith come out
> with another prediction (if at first you don't succeed......). The
> market could go up or it could go down, but it's good to know that Barry
> has meet his article quota this month.
>
>
What did Nostradamus say for this millenium?
>
>
>
> "IPavlov" <> wrote in message
> news:dKGAf.15262$
>> Very interesting article on 2006 DOW prognosis here:
>>
>>
>> It is very contrary to the current market mood. Well..., not counting
>> this last Friday. The argumentation is very convincing and hard to
>> argue with. It is mostly based on analysis of the long term DOW charts
>> The only thing I disagree with is the timing part - the
>> author predicts it to happen in 2006, which is IMHO too exact.
>> While I agree that DOW will be at 6800 at some point in next few
>> years, it might not happen in 2006.
>>
>> IP.
>
>

Re: Cult of the Bear: Getting to Dow 6800

Ed wrote:

> I'm not one to pick numbers like Dow 6800 but I think we will see stock
> prices much weaker in the mid-year.
> If the market does get the big run up first it will put us in "this is too
> good to be true" territory and it would be contrarian to start taking
> profits but this is almost always thw way to go.

The combination of a "too good to be true" rally plus the inverted yield
curve we're getting into, could actually set us up for an October crash.
Shades of 1997.

I'm keeping a very close eye on interest rates and Fed policy.


--
Steven D. Litvintchouk
Email:

Remove the NOSPAM before replying to me.

Re: Cult of the Bear: Getting to Dow 6800

NoEd wrote:

> Does this sound like ramblings of a madman:
>
> The lack of a 10% correction reveals high levels of complacency -- something
> the CBOE Market Volatility Index (VIX) has been implying for quite some
> time. This creates "air pockets" -- soft spots in the base of support that
> can potentially become more vulnerable to selling in the event of a test. As
> the 1966-1982 chart shows, broad trading ranges typically experience much
> greater than 10% corrections. Considering how regularly markets pull back
> and test support, the longer we go without that 10% correction, the greater
> the possibility of a steeper and deeper downturn.
>
> What are "air pockets?" What are "soft spots?" What is "base of support?"
> What does it mean to "test support" and who is the proctor?

This sort of talk makes sense to a Technical Analyst; but by now you all
know what I think of Technical Analysis so I don't have to repeat myself.



--
Steven D. Litvintchouk
Email:

Remove the NOSPAM before replying to me.

Re: Cult of the Bear: Getting to Dow 6800

"IPavlov" <> wrote
> Very interesting article on 2006 DOW prognosis here:
>

75.html
>
> It is very contrary to the current market mood.

Depending on how one defines "current," it's entirely
consistent with the numerology-based approach of many.

The guy tries to discuss the indices behaviors as if the
indices were serial killers following habitual patterns.

He writes how the S&P 500 /could/ drop 30% this year. Uh
huh. A house could also drop on his head in 2006, too. It
really could! If the S&P does fall this much, dodobrains
will hail him a hero. If it doesn't, he's covered is bases:
"could" not "will."

This financial "writing" is designed to feed the ignorant
masses the way extremist religions and opium do. He should
be required to indicate how much he is betting the Dow will
fall to 6800 this year. Charlatan.

Re: Cult of the Bear: Getting to Dow 6800

2005:

TRIGX +15.75%
TBGVX +15.42%
FLPSX +8.65%
OAKBX +8.60%
TRMCX +7.73%
PRWCX +6.85%

VFINX +4.77%

6 for 6 last year, Buddy.

Re: Cult of the Bear: Getting to Dow 6800

On 2006-01-22, Satire <> wrote:
> "IPavlov" <> wrote
>> Very interesting article on 2006 DOW prognosis here:
>>
>
> 75.html
>>
>> It is very contrary to the current market mood.
>
> Depending on how one defines "current," it's entirely
> consistent with the numerology-based approach of many.
>
> The guy tries to discuss the indices behaviors as if the
> indices were serial killers following habitual patterns.
But there are indeed some patterns, admittedly not 100%
repeatable but still they have some value IMHO, unless of
course you follow Malkiel and his "Random Walk" theory and
believe that markets are totally random. The problem with
random approach is that market are random, but not totally.
Very simple example of non-randomness: big fall usually
happens after big rise like 1929 or 2000. This is clearly
not random. So the guy tries to find-out some patterns
masked and hidden by randomness. If you follow total
randomness approach you'll be fully invested in stocks in
2000 and loose big time.
>
> He writes how the S&P 500 /could/ drop 30% this year. Uh
> huh. A house could also drop on his head in 2006, too. It
> really could! If the S&P does fall this much, dodobrains
> will hail him a hero. If it doesn't, he's covered is bases:
> "could" not "will."
To some extent this argument applies to any kind of market
prognosis for one simple reason - this is not science and
any experiment is not repeatable, but being not repeatable
doesn't make it random.

>
> This financial "writing" is designed to feed the ignorant
> masses the way extremist religions and opium do. He should
> be required to indicate how much he is betting the Dow will
> fall to 6800 this year. Charlatan.
>
There are scores of such charlatans all over securities
industry and some of them are getting paid quite handsomely for
their prognostications... Not that I find all their predictions
worth anything, but this particular one just seems to make
sense in current market environment. Of course anybody making
predictions is making a bet on the market. I agree that it would
be much more interesting to see the guy bet with his money and
not with a piece of writing.

IP.

Re: Cult of the Bear: Getting to Dow 6800

David Wilkinson wrote:

> "NoEd" <> wrote in message
> news:
>
>>Does this sound like ramblings of a madman:
>>
>>The lack of a 10% correction reveals high levels of complacency --
>>something the CBOE Market Volatility Index (VIX) has been implying for
>>quite some time. This creates "air pockets" -- soft spots in the base of
>>support that can potentially become more vulnerable to selling in the
>>event of a test. As the 1966-1982 chart shows, broad trading ranges
>>typically experience much greater than 10% corrections. Considering how
>>regularly markets pull back and test support, the longer we go without
>>that 10% correction, the greater the possibility of a steeper and deeper
>>downturn.
>>
>>What are "air pockets?" What are "soft spots?" What is "base of
>>support?" What does it mean to "test support" and who is the proctor?
>>How is complacency measured? Did we not just have a big correction called
>>the bursting of the tech bubble? I wonder if Barry predicted that?
>>
>>You can ALWAYS find someone with purported stature to predict the market
>>moving in each possible direction. If the market does tank, then Barry
>>will appear to be a great prognosticator that investors ought to take note
>>of when he speaks. If the market does not go the way he predicts, the
>>article will soon be forgotten, and he will most likely forthwith come out
>>with another prediction (if at first you don't succeed......). The
>>market could go up or it could go down, but it's good to know that Barry
>>has meet his article quota this month.
>>
>>
>
> What did Nostradamus say for this millenium?

Nothing.
His quatrains expired centuries ago, something that the weirdos refuse
to accept.


--
Steven D. Litvintchouk
Email:

Remove the NOSPAM before replying to me.

Re: Cult of the Bear: Getting to Dow 6800

"IPavlov" <> wrote
> On 2006-01-22, Satire <> wrote:
> > "IPavlov" <> wrote
> >> Very interesting article on 2006 DOW prognosis here:
> >>
> >

> > 75.html
> >>
> >> It is very contrary to the current market mood.
> >
> > Depending on how one defines "current," it's entirely
> > consistent with the numerology-based approach of many.
> >
> > The guy tries to discuss the indices behaviors as if the
> > indices were serial killers following habitual patterns.
> But there are indeed some patterns, admittedly not 100%
> repeatable but still they have some value

Sure. Furthermore, to have statistical significance and so
practical value, 100% repeatability is not required. The
problem is in assuming that market behavior (really, the
psychology of the masses in reacting to information) is a
random process.

> IMHO, unless of
> course you follow Malkiel and his "Random Walk" theory and
> believe that markets are totally random.

That's not quite what Malkiel and "Random Walk" processes
mean.

But I don't want to lecture, especially when the net has
more authoritative and better polished writing on the
subject.

> The problem with
> random approach is that market are random, but not
totally.
> Very simple example of non-randomness: big fall usually
> happens after big rise like 1929 or 2000. This is clearly
> not random.

I generally agree. I just don't like qualifiers like
"clearly" in a discussion such as this.

Again, we're talking about mass psychology, which, like the
psychology of individuals, assumes a certain amount of
rational thought, but some thought that is arguably not so
rational and certainly is based in emotion.

> So the guy tries to find-out some patterns
> masked and hidden by randomness.

There will always be some people at some time who have a
pattern or algorithm that will "successfully" predict the
market for at least some period of time. I suspect you know
this. Just clarifying, or trying to.

Our own David Wilkinson (currently running this year's MIMF
contest) has been using a numerologic-based strategy that
has shown, it simpy cannot be denied, impressive results in
the last few years. Will this strategy work each year of the
future? (We could even back test it and see if it /would
have/ worked each year in the past.) I don't think so. But
could it work for a number of years and enable him to retire
from his career on Usenet as a rich man? Sure. But there is
a strong element of luck in this. Even he should admit this
is so, else he would bet his life savings on his strategy
and retire at the end of this year.

> There are scores of such charlatans all over securities
> industry and some of them are getting paid quite
handsomely for
> their prognostications...

lol

Correct

And yet, I think it noteworthy that the analysts who display
a certain amount of, for lack of a better vocabulary,
"financial humility" are the ones who deserve the most
attention. (Indeed, the Motley Fool recently mentioned that
humility was one predictor of a CEO's success.)

I am sold on Shiller of Yale lately. I am reading a lot of
old timer but still esteemed Benjamin Graham (of value
investing) as well. Alan Greenspan is definitely one smart
and IMO very humble guy who has served the country well.
(There is no perfection per se attainable in a job like
his.)

> Not that I find all their predictions
> worth anything, but this particular one just seems to make
> sense in current market environment.

That there should be a major correction to the tune of
driving the Dow to 6800? That's a 36% drop over some time
period. That's talking 1930s Depression like madness, which
had a rational <sic> basis. Barring another serious
terrorist attack, no, I don't think that makes sense. For
one thing, once the Dow hits around 8500, the value-inclined
analysts likely will start trmpeting how P/E = 15, so start
looking for serious bargains. Their reasoning makes a lot
more sense than that of the more extremist numerologists.

> Of course anybody making
> predictions is making a bet on the market. I agree that it
would
> be much more interesting to see the guy bet with his money
and
> not with a piece of writing.

I think we are generally in agreement.

I will say that one thing I like about such reporting is
that it inevitably includes some historical perspective. So
it wisely tends to counsel people away from being too
bullish, lest they lose their shirts. That's something
Americans desperately need to hear, IMO. If by chance we do
get into another Depression, it will be largely because of
overborrowing and overspending by individual Americans,
widening the gap between rich and poor, resulting in riots
and panic. You give these folks of little means just cake,
and no education to handle all that crippling debt that the
banking industry is marketing so effectively, and they will
start murdering each other, and ultimately they will go
after the middle class and on up. Roughly speaking. There
are these ramblings that compel me to be somewhat
conservative in my stock positions. Buy only stock I can
afford a 30% hit on and that I feel couldn't possibly
decline more. Have a sizable amount of cash, to last at
least seven years.

Re: Cult of the Bear: Getting to Dow 6800

"Steven L." <> wrote in message
news:AqQAf.3793$
> David Wilkinson wrote:
>
>> "NoEd" <> wrote in message
>> news:
>>
>>>Does this sound like ramblings of a madman:
[Snip}
>>
>> What did Nostradamus say for this millenium?
>
> Nothing.
> His quatrains expired centuries ago, something that the weirdos refuse to
> accept.
>
It was a joke, Steven! I'll put a little :-) with the next one

Actually though, since you made the claim above I looked him up and it is
not true that they all expired centuries ago. He made one prediction about
the world ending in 2000 and the dead rising from their graves, neither of
which were fulfilled AFAIK :-).
>

Re: Cult of the Bear: Getting to Dow 6800

I think you should go back to the "."
Better yet, "0"

"Satire" <> wrote

Re: Cult of the Bear: Getting to Dow 6800

NoEd wrote:
> Does this sound like ramblings of a madman:

> You can ALWAYS find someone with purported stature to predict the market
> moving in each possible direction. If the market does tank, then Barry will
> appear to be a great prognosticator that investors ought to take note of
> when he speaks. If the market does not go the way he predicts, the article
> will soon be forgotten, and he will most likely forthwith come out with
> another prediction (if at first you don't succeed......). The market could
> go up or it could go down, but it's good to know that Barry has meet his
> article quota this month.

Relax. Looks like he once had a change of avocation -- like anyone
could, I suppose. Other than a nice run for the money, would need find
out how well he's stacked by comparison for qualifications within a
contituency I see no reason he didn't earn.

Barry Ritholtz is the Chief Market Strategist for Ritholtz Research, an
independent institutional research firm, specializing in the analysis
of Macroeconomic Trends and the Capital Markets. Ritholtz is also
President of Ritholtz Capital Partners (RCP) a New York based Hedge
fund. RCP is driven by the analysis performed by Ritholtz Research.
Ritholtz holds a bachelor's degree in political science (with a
concentration in philosophy) from the State University of New York at
Stony Brook.

He subsequently picked up three years of law, enough to qualify for the
practice.

Every crowd has a silver lining. -Phineas Taylor Barnum (& Bailey & the
Ringling Brothers)

Re: Cult of the Bear: Getting to Dow 6800

The proof would be that you tell us IN ADVANCE. After the fact is simply
yada, yada, yada, a.k.a. blah, blah, blah.


"Ed" <> wrote in message
news:
> 2005:
>
> TRIGX +15.75%
> TBGVX +15.42%
> FLPSX +8.65%
> OAKBX +8.60%
> TRMCX +7.73%
> PRWCX +6.85%
>
> VFINX +4.77%
>
> 6 for 6 last year, Buddy.
>

Re: Cult of the Bear: Getting to Dow 6800

I posted these more than once over the past year.
Were you sleeping? Do a little googling and see for yorself.




"NoEd" <> wrote in message
news:
> The proof would be that you tell us IN ADVANCE. After the fact is simply
> yada, yada, yada, a.k.a. blah, blah, blah.
>
>
> "Ed" <> wrote in message
> news:
>> 2005:
>>
>> TRIGX +15.75%
>> TBGVX +15.42%
>> FLPSX +8.65%
>> OAKBX +8.60%
>> TRMCX +7.73%
>> PRWCX +6.85%
>>
>> VFINX +4.77%
>>
>> 6 for 6 last year, Buddy.
>>
>
>

Re: Cult of the Bear: Getting to Dow 6800

Ed <> wrote:
> I'm not one to pick numbers like Dow 6800 but I think we will see stock
> prices much weaker in the mid-year.
> If the market does get the big run up first it will put us in "this is too
> good to be true" territory and it would be contrarian to start taking
> profits but this is almost always thw way to go.

I agree. The "favorable" season for stocks is always Oct-Apr. I figure
with the 4yr presidential cycle, an inverted yield curve and all the geo
political tension it is headed down.

For the 1st time I've actually bought some puts on the indexes (SPY & DIA).

I figure if I lose the money - no big deal - oil will do well.

-Sanjay

Re: Cult of the Bear: Getting to Dow 6800

Contest?


"Ed" <> wrote in message
news:
>I posted these more than once over the past year.
> Were you sleeping? Do a little googling and see for yorself.
>
>
>
>
> "NoEd" <> wrote in message
> news:
>> The proof would be that you tell us IN ADVANCE. After the fact is simply
>> yada, yada, yada, a.k.a. blah, blah, blah.
>>
>>
>> "Ed" <> wrote in message
>> news:
>>> 2005:
>>>
>>> TRIGX +15.75%
>>> TBGVX +15.42%
>>> FLPSX +8.65%
>>> OAKBX +8.60%
>>> TRMCX +7.73%
>>> PRWCX +6.85%
>>>
>>> VFINX +4.77%
>>>
>>> 6 for 6 last year, Buddy.
>>>
>>
>>
>
>