AU Editorial: Is All Forgiven?
Email This Article
Print This Article
Digg This
Delicious
SubscribeMOST POPULAR ARTICLES
- Kaeppel's Corner: 2009, The Year of Investing Differently
- Weekly Outlook: January 5, 2009
- Hot Shots: "Obamaistic, Not Foolish"
- Option Watch: Jan 6—Mover & Shaker USG Corp.
- Platinum Tools: Platinum Rankers
- Closing Wrap-Up, January 5
- Midday Action: January 5
- Interview Central: Brian Shannon, Part III
- Growth Stock Swing Option: Jan 5, 2009
- Midday Action: January 6
- Kaeppel's Corner: 2009, The Year of Investing Differently
- Outside the Box: Using Government Backed TIPS to Insulate a Portfolio
- Commodities Roundup: Soybeans
- Platinum Tools: Platinum Rankers
- Hot Shots: "Obamaistic, Not Foolish"
- Interview Central: Brian Shannon, Part III
- Foreign Exchange: Rise of the Euro
- Outside the Box: Tweaking the Traditional Straddle for More Flexibility
- 'Twas the Bailout Before Christmas
- OPTION TALK: Understanding Our Greek Friends
- Outside the Box: Controlling Risk Is Key for a Trading Business
- Kaeppel's Corner: The Early January Alert
- Economic Watchdog, Jan 7
- Midday Action: January 7
- Option Watch: Jan 6—Mover & Shaker USG Corp.
- Commodities Roundup: Soybeans
- Tech World: Helmerich & Payne Looking to Rebound
- Midday Action: January 6
- Growth Stock Swing Option: Jan 5, 2009
- Economic Watchdog, January 5
SPONSORED LINKS
December 1, 2008
As I watched the markets last week – well up to Thursday when I write my column – I wondered if investors might have reason to think all is forgiven… it is all over and we will all live happily ever after and there will be no more pain. Think again.
I have been wrong many a time and will be wrong again, but this week’s market action of a 5% surge will not be enough to lure this hard head into thinking all is good.
I would like to look at copper as a good litmus test for what is going on. Let’s go straight to the chart:
What we see above is typical of numerous equity markets world wide, most sectors, most metals, and most commodities. The chart says we are likely to see a rally – a relief rally, a bear trap – call it what you like. And then yes we are going to see another ‘shoe drop’ – another leg down.
When such short term rallies take place, there are some early believers or pundits who see a quick quid. Some impetuous punters think they are going to miss out and jump on board as they have heard everything is cheap.
And then –oops! – some more bad news. Don’t ask me what it is but there is some lurking. And down the markets go again and this time even lower. Some real pain, real value and then markets start their real and sustained rally.
I don’t think Santa Claus will bring it in this ''annus horribilis'' but we may see a new world in 2009.
Enjoy the ride
Tom Scollon
Chief Analyst
Trading Tutors Team
© Copyright 1995-2009 Optionetics. All rights reserved. This material is for personal use only. Republication and re-dissemination, including posting to newsgroups, is expressly prohibited without the prior written consent of Optionetics. Optionetics is a registered trademark of Optionetics, Inc.