Wednesday, January 28, 2009

Take the Poll ---->

There is one day left in the little market opinion poll I have set up on the right of this page. So far, it looks like there is no real overweight of opinion on any of the choices although the pogo stick answer does have a clear majority. Please take a moment to vote - and it really only takes a moment.

Let's say that overnightwe get a rash of votes for the pogo stick. What would that potentially mean? For starters, absolutely nothing since there would be no statistical validity to it. We'd need thousands and thousands of votes to get a handle on what the public is really thinking.

But let's say for fun that we get a 90% reading for the pogo stick. That would be an overwhelming majority and tell us that everyone is thinking the same thing. As we know, the market loves when that happens so it can do the opposite. In this case, that would be a directional move and a big one. The opposite of a trading range is a trend.

Which way? From this there is really no way to know. But anyone who has followed my work or subscribed to my newsletter knows that I don't believe that the market is going to go a whole lot lower. Undercut the old lows maybe. But not the doomsday levels some are forecasting.

So speak out, dear reader! Take the poll and lets see what you sophisticated investors are thinking.

6 comments:

Amalan said...

I voted yesterday, and guess what - I belong to the minority view that an uptrend will begin. Although when I voted I couldn't/didn't see the results, I knew from past discussions that most people expected a trading range, and we know the market does the unexpected, and hence my vote for the upward trend. However, now you have published the votes on the first page, so people can actually vote for the minority view even if they didn't believe it going in. Therefore, I think when the survey is closed, we can safely add another 10% to the pogo stick vote and reduce the uptrend vote accordingly.

As you say, we don't have sufficient numbers for statistical significance anyway...

One more thing - the percentage value seems to be in a very light colored font - hard to see.

paulocuana said...

imho...I was a big bull on November's low but now I'm not too sure. Fundamental arguments are very compelling for a big downturn.
This from Carl Swenlin based on GAAP earnings on the S&P 500:

Undervalued (SPX if P/E = 10): 460
Fair Value (SPX if P/E = 15): 689
Overvalued (SPX if P/E = 20): 919

Where will earnings come from?

Paul O' Cuana

RPS said...

I voted pogo stick, but that represents a disconnect with economic reality. People might say, "you can only lose so much money". That's far from the truth in a world spinning on a derivative axis. It's almost as though the Law of Gravity is repealed and the water can fly into space. That being said, the masses of debt will be transferred to the masses by the Prints-a-Ton Professor, Dr. Guten-bergnanke.

Quick Takes Pro said...

Amalan,

There is another spin to this poll and that is that more than half of respondents think the stock market will be at least somewhat lower by summertime.

As for dealing with the color, I just drag my mouse over it and the colors invert.

Quick Takes Pro said...

paulocuana,

You are asking a technical analyst about earnings.

My answer is that where was the lack of earnings in October 2007? Everything looked peachy back then just like everything looks like meadow muffins now. The stock market looks months down the road so I'd have to say that's where your earnings are.

Vive la stimulus! (Ouch, I just bit the tongue in my cheek).

Quick Takes Pro said...

RPS.

Awesome comment!

As for only losing so much money, I agree. You can lose only as much as you put up (non margin).

Again, said with a wry smile.

Everyone will have properly adjusted risk expectations when they treat stocks like options. Buying now will either be a home run or they will expire worthless.