Charts for Thursday Pre-Market Podcast
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Posted 10 May 2006 - 09:21 PM
Examples of frustrating consolidation periods which created a high level of bearishness among short term speculators, usually precipitated by adverse economic conditions which were present at that time.
These periods were followed by "outlier rallies" which were necessary to work off months of cumulative bearish sentiment.
"Bond Market Crash" 1993-1995
"Asian Flu" 1997-1998
"Y2K Scare" 1998-2000
Note the wide divergence between the OEX and the Rydex Ratio at this time.
And the 90-day and 200-day Put/Call ratio has been rising since the March 2003 lows.
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