CosmicDust
Short

SPY/TLT Relative Strength Index study.

SPY/TLT  
SPY/TLT  
264 2 5
Use how RSI behaved during 2007 and 2011 market correction to predict how RSI will behave in the current market situation. It seems to suggest market may bottom around September with 7-8% drop (In SP             500 term).
Tech time
2 years ago
Interesting long term chart analysis. I think the market has gotten relatively complacent...people have the thought process of "QE infinity", buy every dip, and we simply have no alternatives. I read some data that suggests managers are opting for bonds instead of stocks (thus far for 2014). Bonds don't really offer a significant return, but have less downside risk (via volatility). I am biased equities, but only cheap ones. Klarman isn't a buyer, activists investors are pushing for massive buybacks to force appreciation, Soros has a 1.3 billion put option. The market has been turned upside down by this excessive stimulus, meaning it IS expensive, there is simply no question at this point. Institutions could bid it higher...although there's no real safety at this this level for highly correlated stocks.

Not to mention that almost every cyclical trader/investor dumps in April and May. Don't be fearful...just rational. Ask yourself this question, are you a buyer of the SPY at 189? Some say yes, others no.
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CosmicDust Tech time
2 years ago
Thanks for your comment Tech. I usually follow price action only (moving average, support/resistance, breakout/breakdown, that sort of things). I just keep an eye on analysis like this one but do not commit money upon it as if the market HAS to behave that way. In today's market that is fully controlled by the Fed, big banks and HFT, crazy things can happen so I think be flexible is the key.
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