Bear country

  1. 1,383 Posts.
    The US has turned round to the upside as expected and now we will see what this bear rally is made of - whether we are now on a big slide or whether the rally will continue as it did after Sep 21.

    Despite a superficial resemblance to the Sep recovery, the present setup looks much more like a short and not very sweet short covering episode. The SPX is much clearer than the other indexes and may be in the process of making a small H&S. If it stalls around 820 - short the buggery out of it for a big slide.

    The usual christmas rally may not be such a sure thing as it usually is. Note that it did not happen in the following years - 1990, 1994, 1996, 2000. 2002 might be next. Particularly if the economic downturn begins to be obvious within a few months. The usual suspects are the ones to short - BIL AMP MIM RIO etc.

    On the positives - oils look like a buy to me, chartwise. NAB and TLS also look OK. And gold of course.

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