Bear market signal Archives - Options Trading Strategies for Consistent Income - OptionPundit

Just What I Said

By | Market Psychology, US Market, Worldwide Markets | No Comments

What a week that it was!! It’s very easy to say “just what I said” and pat your shoulder but the tough part is to say now what’s next? How do I benefit from what’s coming? I shall share what I mentioned to OPNewsletter members last week– So fireworks happened in the afternoon trading… …today is a critical day. Usually after such a sell-off we should be expecting a rebound for 2-7 days but it doesn’t look like the case based on market futures. If Dow can’t hold on to the recent lows, I think 9,400 (+/- 50 or so) will…

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This Time is Different?

By | Technical Analysis, US Market, Worldwide Markets | 4 Comments

In order to share current market conditions, I borrowed this title from an excellent book “This Time Is Different: Eight Centuries of Financial Folly by Kenneth Rogoff and Carmen M Reinhart”. If you haven’t read it, I shall suggest that you get a copy and read it. Let’s get to the business. If by June 30th, Dow can’t close above 10,130 this will be the 2nd consecutive month of downward move by Dow for the first time since March’09 bottom. Well, so what? Before recent pullback begun, I drew a chart on NDX (Nasdaq-100). In this chart I drew a…

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Is the Correction Over?

By | Market Psychology, Technical Analysis, US Market, Worldwide Markets | 3 Comments

Is this correction over? Probably a trillion dollar question that is going through everybody’s mind! The irony is that whoever has the crystal ball to answer this, probably doesn’t even need to answer this as he/she must have already achieved the market nirvana. Rest of us can only try or guess. Let me share my two cents on where we are. First, if we assume that stock market is a leading indicator, then it is already projecting tough economic environment ahead. Does that mean are we going to see a double dip recession? Here is what one of my favorite…

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Is It the Beginning of a New Bull Market?

By | Investment Strategy, Market Psychology, US Market | No Comments

It’s been quite a while since I last posted and since then a lot has occurred in the markets. Just to provide the context before proceeding, since we opened Aug OPNewsletter portfolio 2wks back , hold your breath, X is up almost +25%, OIH +14%, IWM /RUT +11%, GDX and Dow +9%, S&P500 almost +8%. What a spectacular bull run over bearish bias we had for OPNewsletter. These are fairly large move, in such a short span, from historical standards. And guess what, Bulls have been charging up and away without any resistance from Bears, day after day. The market…

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What’s Next for Stocks Markets and Me

By | Fundamental Analysis, Investment Strategy, Market Psychology, Option Trading | No Comments

So we are having a great rally. It doesn’t seem like it wants to pause. If Dow is up this week, it will be up 8 out of the last 9 weeks. Wow, what a complete reversal of a downward trend that we had been observing since last year. What an extended overbought period. The bears, including me, have been waiting for a pause or correction which seems not to take place. The stock markets are currently behaving like a shock absorber and nothing seem to discourage bulls. All well, till it is not. A lot of my personal holdings…

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Get Ready for Next Bear Leg and Start Hedging

By | Market Psychology, Technical Analysis, US Market | 2 Comments

As of yesterday’s close, the DJIA has gained 21% since establishing the March 9 low. The S&P 500 and NASDAQ have gained 23% and 25%, respectively, over the same time period. Wow, we have had wonderful rally so far, >20% gains in matter of less than 3 weeks; and probably one of the strongest rally that we have seen in this bear market. To make the bullish case even stronger, the rally continues to extend despite overbought conditions showing solid strength. But, is this short covering or real buying? During great depression, there were almost 8 to 9 rallies depending…

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