Stock Market Analysis – 11-16-2007
The market actually closed strong today, ending the volatile week pretty close to where we started. It’s been a while since I looked at the weekly chart, so that’s what I’m posting today. We’re still above the channel that went from 2004 through 2006, so it’s a good sign that it wasn’t just a quick exhaustive run. I still believe that we’re in for a large scale correction, but this gives a couple of signs to look for. In the best case, the market would stay flat until the channel bottom caught up to it. In the worst case, the market would tank and overcorrect through the bottom. I’m not going to be holding any super long term positions until the market proves it can break the high set back in 2000 around 1500. Until then, it’s mostly trading with tight stops and avoiding the riskier growth stocks, since those are the ones that feel the most pain when people liquidate.
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