Are we in or nearing the capitulation stage of bear market?

[FUEGO]

Just took a peak at the market, and the activity today is starting to make yesterday look like a bottom! Or this is a dead cat bounce. Broad domestic and international indexes up 4+% across the board right now.

[al_bundy]

i think it's a bounce for a few months maybe until next year

[2B]

Quote:

Originally Posted by utrecht I didnt say I was out of the market. I was responding to 2B who wanted to compare somethng like this: Buy and hold SP500 from Jan2000-Dec-2007....compared to Buy SP500 anytime after Jan2000 only when VIX oes over 30 and sell when VIX is less than 20 (or 17..or whatever). At least thats what I think he meant and if so, the second scenario will have you totally out of the market alot of the time.

I was just questioning whether the VIX provided value as a market timing tool. Just looking for data.

As for todays rally, we were getting pounded down again when an announcement came out that there is a "resolution trust like" agency planned to be created to deal with the current credit crisis.

I'm sure if this really breaks the credit crunch the pundits will point to yesterday as the "capitulation." I'd say the rules may have changed today.

[al_bundy]

i'll believe it when i see it, the systemic risks may go away but after the short covering goes away people will still have to worry about the economic issues.

[dex]

Quote:

Originally Posted by 2B I'll concede that the VIX is a great measure of market panic. It follows the old rule of buying when there's blood in the street. What you can't predict with the VIX is that when you buy a 30 you won't know that you could have gotten a better deal at 40. I'm sure someone could do a multi year calculation of buy the S&P with the VIX at 30 and sell at 17. Then compare that to a buy and hold of the S&P index over the same period. Heck. Some data might be useful.

What you're basically asking for is and indicator to tell you this is the "Top" or "Bottom" - otherwise know as "The holy Grail" - don't let anyone know once you found it. Once everyone knows about it - it stops working.

[dex]

Quote:

Originally Posted by al_bundy Japaneese candlesticks were first invented in Japan to graph rice prices and to find patterns in their rice trading market.

The magazine of Technical Analysis did a study of it years ago and didn't find it any good as an indicator.

[al_bundy]

Quote:

Originally Posted by dex The magazine of Technical Analysis did a study of it years ago and didn't find it any good as an indicator.

like any study, depends on how it's done. i read that if you look at them when other indicators are at the extremes they are accurate. otherwise not really

[dex]

Quote:

Originally Posted by al_bundy like any study, depends on how it's done. i read that if you look at them when other indicators are at the extremes they are accurate. otherwise not really

STOCKS & COMMODITIES magazine
here's the link for the mag.