When to re-enter the market?

[Crypto Crude]

Yes I would have recommended NWE to my granny at that time (when I said it)...
production stage started to look shakey,
She would have been long sold by then... just like I was...
Im way ahead of you this year even with my big hit last week with LMP, and LMPO...
Im still part cash, so Im only playing with what Im prepared to lose.....
whats your take on the US Rebate cheques MD?

.^sc

[duncan macgregor]

SHREWDY, My take on the rebate is the market will recover for a nice blip up then carry on trending down. I much prefer being out the market at the moment quite content to let the market run its cycle. The NZ economy will have its share of troubles with free trade to china driving it into a farming back water and lowering living standards. It looks like last man out switches the lights off. Big shake ups in the near future dont get caught in shares like LMP that have a low volume. Macdunk

[Dr_Who]

WHITE HERON, Look up investment groups and clubs at the bottom of the page. SHREWDY and STRAT forced me into a competition where at the moment am the only person on sharetrader in front of the market. The prize is skiting rights which i am using up as long as it lasts. Macdunk

Have you been sniffing glue again?

[Lizard]

Well now that all the re-entry indicators have probably been well and truly triggered it seems time to start thinking about when it might be time to get out again! We have yet to see the extent of overflow from the financial and housing sector to the "real economy" - i.e the effect on forecasts and profits for core NZX50 companies such as FBU, NPX, WHS, PFI etc. Maybe it will be negligible and we have seen the worst. Or quite thinkably, there will be a second major down wave at some stage.

So the question for Phaedrus is; from a TA standpoint, to monitor the NZX for "exit" signs, would you now use the indicators/periods you used for re-entry or some other indicators/period (at least until a longer term trend is established)?

[bermuda]

Well now that all the re-entry indicators have probably been well and truly triggered it seems time to start thinking about when it might be time to get out again! We have yet to see the extent of overflow from the financial and housing sector to the "real economy" - i.e the effect on forecasts and profits for core NZX50 companies such as FBU, NPX, WHS, PFI etc. Maybe it will be negligible and we have seen the worst. Or quite thinkably, there will be a second major down wave at some stage.

So the question for Phaedrus is; from a TA standpoint, to monitor the NZX for "exit" signs, would you now use the indicators/periods you used for re-entry or some other indicators/period (at least until a longer term trend is established)?

Re enter the market at your own peril.

Things are going to get very bloody . Oil goes higher and inflation fuels a winter of discontent. A lot more companies will start going on strike trying foolishly to play catchup.

If you are going to be in the market make sure it is oil and gas and coking coal....otherwise start shorting.

[Lizard]

Re enter the market at your own peril.

Things are going to get very bloody . Oil goes higher and inflation fuels a winter of discontent. A lot more companies will start going on strike trying foolishly to play catchup.

If you are going to be in the market make sure it is oil and gas and coking coal....otherwise start shorting.

In context bermuda, that chart is an old one from I think around page 2 of this thread...since then, the gains have been pretty spectacular. This automatically leads to me taking some profits. However, my "system" is rather vague and ineffectual at the market level, so I am interested in seeing how Phaedrus' more defined system stacks up.

[scamper]

In context bermuda, that chart is an old one from I think around page 2 of this thread...since then, the gains have been pretty spectacular. This automatically leads to me taking some profits. However, my "system" is rather vague and ineffectual at the market level, so I am interested in seeing how Phaedrus' more defined system stacks up.

isn't there some old chestnut that reads "sell in May and go away"?
i don't actually know the background to that, but it should be considered by the cautious.

[Hoop]

isn't there some old chestnut that reads "sell in May and go away"?
i don't actually know the background to that, but it should be considered by the cautious.

Old sayings have a generalised facts based around it. Remember it is generalised and sometimes doesn't come true e.g DOW 2007.

In NZ I'm always cautious around NZX reporting time.. August Sept October. It tends to be a seasonal thing so consider that we are opposite to Northern Hemisphere but remind yourself the large Northern Hemisphere markets do have some network effect.

The Background...
Quotes from CNN money 2/5/2005
.... The second quarter, which starts in April, tends to be weaker, as the positive effects of holiday bonuses and the holiday retail sales period fade out, and a "spring cleaning" mentality kicks in, Hirsch said.
As summer rolls around, people would rather be spending less time in the office and more time enjoying the weather. That change in psychology often extends to the market as well, Hirsch said, with lower trading volume and more rangebound markets.
When the fall creeps in, the psychology switches to getting back to school and back to work and, from a stock standpoint, to cleaning house. To that end, September is traditionally the biggest loser on a percentage basis for the Dow, S&P 500 and Nasdaq.
October, which starts the fourth quarter, can be tough at the beginning but usually turns around by month end, and the quarter as a whole tends to be more upbeat, especially once work bonuses and the holiday sales period kick in.

How true is the saying ??
quote CNN money same article..
....To demonstrate the strength of the November through April period versus May through October, the Stock Trader's Almanac tracks the gains you'd see if you invested $10,000 in the Dow industrials on Nov. 1 of each year and then sold April 30.
If you'd done that every year since 1950, you'd have earned $492,060 on a $10,000 investment, according to the Almanac. But if you'd reversed the whole process, and invested the compounded $10,000 during the May-October period, after 54 years you would have ended up with a $318 loss.
For the S&P, the gains would be $349,165 over the 54 years during the "best" six months and gains of $7,102 during the "worst" six months....

[Phaedrus]

Well now that all the re-entry indicators have probably been well and truly triggered it seems time to start thinking about when it might be time to get out again! We have yet to see the extent of overflow from the financial and housing sector to the "real economy" - i.e the effect on forecasts and profits for core NZX50 companies such as FBU, NPX, WHS, PFI etc. Maybe it will be negligible and we have seen the worst. Or quite thinkably, there will be a second major down wave at some stage.
So the question for Phaedrus is; from a TA standpoint, to monitor the NZX for "exit" signs, would you now use the indicators/periods you used for re-entry or some other indicators/period (at least until a longer term trend is established)?

The 10 indicators shown here are tailored to the current "medium-term" downtrend and are for modulating entry into the market. They give a good "medium-term" overview of the market, but are not meant to provide exit signals for open trades. Any open positions should be monitored separately, each with its own individual suite of indicators. With these 2 systems in place, you are protected from the effects of any ongoing general market weakness, but are free to capitalise on individual opportunities in the meantime. I have not set up any formal "MOVE TO 100% CASH RIGHT NOW" system, but a drop below the March low of 3484 would certainly quench my current (short-term) optimism.

I would agree with all of you here that are advising caution, and any trades should be tightly monitored. Nevertheless, this is a time of great opportunity, offering potential for substantial gains.

We each have own own level of risk tolerance and we are all somewhere on the Greed/Fear continuum. Buying or trading at times like this is not for everyone, but with appropriate safeguards there is a lot of money to be made - right now.

[Lizard]

Thanks Phaedrus. That is pretty much what I thought you would say - i.e. monitor individual positions closely and wait for a longer term trend (or perhaps a range) to emerge before re-instating a set of indicators for the index itself. Oh and yes, watching for a break of earlier index low as perhaps the ultimate "move to 100% cash" level in the mean time.

If the index was to break clear of the early April peak, would it then be appropriate to reset the period on the indicators (i.e. go back to longer RSI etc based on emerging trend) to establish another "caution" mechanism (or perhaps more correctly to allow you to relax a little bit by establishing a less volatile "non-caution" zone!) or would that be premature?