转贴:Did the market just put in a bottom?

plankton

Did the market just put in a bottom?
August 3, 2011, 5:30 PM


Now what?

We’ve had eight days of slides, followed by tepid gains Wednesday against  an economic backdrop that really and truly stinks.

If you look at the S&P 500 and see the portrait of a head and shoulders formation, you’re in very good company.

But as J.C. Parets points out, you might have thought the same thing a year ago. And you might have thought the same things two years ago. And the neckline in the S&P is pretty clearly at 1250, and it wasn’t broken Wednesday, even after 8 days of relentless grinding losses against an economic backdrop that really and truly stinks.

Parets’ thesis is that the markets put in a pretty good hammer Wednesday, as in hammering down a bottom, even though we’re in an economic backdrop that really and truly stinks.

So, played properly, Wednesday’s action is a buying opportunity, as long as you take the trouble to protect yourself from getting your head cut off because this is  an economic backdrop that really and truly stinks.

-Tom Bemis