Don't Press to the Downside

Tuesday, July 18, 2006 | 10:37 PM

I meant to post this last [Wednesday] night, but got back home too late to do so. Rev Shark gave some good advice yesterday afternoon about pressing the downside:

"The very persistent weakness in this market is really amazing. Buyers have absolutely no trust in this tape, and even the most minor strength is an invitation to sell and drive us lower. Breadth has once again slipped to 2-to-1 negative, and all major sectors are in negative territory.

Support levels and the like are totally meaningless at this point. We are in a very ugly downtrend and where it stops no one knows. Forget looking for technical reasons to figure out where the market might stop.

The trend down is to be respected, but keep in mind that it is getting stretched to such a degree that a sharp bounce is increasingly likely. The danger of pressing shorts here is growing as the misery of the longs accelerates.

I'm doing absolutely nothing. The stage is certainly set for something explosive in the next couple of days, with Ben Bernanke on stage and a full schedule of earnings reports.

Although this market looks ugly as sin and is in clear technical trouble, I would be very worried about being overly aggressive on the short side at this point.
(emphasis added).

Kudos to DePorre on a good and timely call . . .


Hideous Market Still Not a Safe Short
James DePorre
Real Money, 07/18/2006 1:41 PM

Tuesday, July 18, 2006 | 10:37 PM | Permalink | Comments (3) | TrackBack (0) add to | digg digg this! | technorati add to technorati | email email this post



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great call Rev

Posted by: Hitthebid | Jul 19, 2006 1:49:47 PM

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