Ander's Market Theories

[AnderL]

That is the what my eyes are telling me frenchee, but I'm holding a nice 5% gain on my UOPIX. I'm holding this gain and looking for more. 1550 was a very significant resistance line and a large number of traders shorted the bounce only to be caught against buying support only 20 points below that. That killed a lot of short positions and drove the markets back up over their break of support.

Since traders are still especially bearish on the market and I don't see sentiment changing much on these boards or in the newsletters I fully expect any tight trading range or weak AM buying power to be used as an opportunity by retail traders to attack the markets with more short positions.

This should bring in some hesitant buyers who have been sidelines and do not want to miss out on the uptrend and that should drive out the more defiant shorters who understand the fundamentals and technicals of these markets.

In the end the traders who trade the true market internals will be burns and will short up the markets asking "How is this possible" "Who is stupid enough to buy the markets here?" "Don't they see what is coming down the pipes?" These kinds of thoughts have their foundation in logical and to defy logic brings about an emotional response in traders who get upset when they did everything by the book and the markets still went against them.

The result of this kind of mentality will force the shorts to cover with losses or flip to to the long side just in time for the big buyers from bellow the technical breakdown point to sell into.

Again this is just one man's speculation on how the markets may get played out.