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RVB's Market Musings

What began here as an avenue to interact and learn has far exceeded those goals.

If you are a prospective employer, please consider this site a place where you can see my passion for investing...

Thursday, January 26, 2006

Another rally should be coming...

This morning, while taking a break from reading my "Valuation" Book, I thought to check today's Investor's Business Daily for the most recent Investors Intelligence Survey numbers. This is what I like to see: the percentage of bullish advisors is declining - and we haven't seen a big decline. If that holds, then we should at least see a re-rally to retest the old highs. One of the things that I believe strongly is that "reversals retest themselves". So, watch for a probable retest, and expect it to be weak (maybe it won't even get to the old high), which could be an opportunity to raise cash or move to more defensive positions. Don't be surprised to see 1245 on the S&P before this happens, but don't be surprised for it to just happen anyways before that happens...

1 Comments:

At January 26, 2006 11:04 AM, Blogger NO DooDahs said...

We may have just seen that rally today.

The trendline connecting the low of 10/28 with the low of 1/3 was violated Friday, and now appears to be resistance vs. the 50 DMA being support.

Do we stay squeezed in that wedge, or do we break down below the 50 DMA? I've been betting on the latter, but I may have been early (or just plain wrong).

 

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