Tuesday, September 9, 2008


Follow Me on Facebook Follow Me on Tweeter
Unexpected news and unexpected crash, at least for me. Yet, after the reading the news at the morning we know the market reaction on them. We’ve already been there in January 2008, and we already witness July 2008. This is the third financial company that is suffering. In both previous cases we saw it at the very bottom and then we had a strong rebound.

The last two trading session we had extremely high activity (trading volume) on the stock market which could be compared to the daily volume in the January 2008 and July 2008 only. Let's take a look at some historical record daily volume numbers below:

1st PlaceJanuary 22-23, 2008January 22-23, 2008
2nd placeSeptember 8-9, 2008 (now)July 15-17, 2008
3rd placeJuly 15-17, 2008September 8-9, 2008 (now)
4th placeJuly 11-16, 2008July 11-16, 2008
1st PlaceJuly 15-17, 2008January 22-23, 2008
2nd place September 8-9, 2008 (now)January 16-18, 2008
3rd placeJuly 11-16, 2008September 8-9, 2008 (now)
3rd placeJanuary 22-23, 2008July 15-17, 2008

Isn't it interesting... I always associate high volume surges during the price slide with panic selling and extremely high volume - with extremely panic selling which lead the market into heavy oversold stage and as a result into strong reversal..

Based on the volume technical analysis (numbers above) I can set a few points for myself:
  • I believe that we are at the bottom;
  • I'm expecting to see very strong and sharp recovery;
  • I assume that we may see further slide (there is always a possibility of that), yet, I believe, soon we will see the stock market much higher than we are today and than we were yesterday;
  • I consider it's extremely risky to be in short now - personally, today, I would rather open a long position than tried to make some money by playing down;
Again, my technical analysis is my subjective view on the stock market. I do not recommend follow it, do not relay on anyone opinion - do your own home work, at the end if you lose you lose your own money.

No comments: