Wednesday, January 11, 2012

11 Jan 2012

 Sometimes when I think about taking a position, I always find it prudent to see when I should have taken that position.  I know should have, would have don't matter most of the time, but here they do.  The time to clearly buy for this rally was in August - this is especially evident in my medium term chart below.  If you are buying now, you are just riding the last of the tailwinds.  The risk / reward ratio is out of the little guy's favor.
 Short term still aimlessly wandering near overbought territory.  Note that this can stay this way for a long time as it did in 2010.
 Medium term rapidly reaching overbought levels.  See in August where the time to buy was?
I marked the TSV on this chart.  You can see we are not overbought by its standards, but the odds are getting out of our favor for buying here.  I am a contrarian because I have found that to be the only way to make money in the market.  I'm sure there are others, but I don't know them.

"Enjoy present pleasures in such a way as not to injure future ones."
 Seneca (5 B.C. - 65 A.D.)

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