Replies to post #220798 on Zeev's Turnips Patch-No Politics (ZEEV)

[Zeev Hed]

All I can say is we are close, but any model that relies on a single parameter to determine local lows, fails, we have had false call from low P/C (even virgin one) ratios as well as high one. The fact that the P/C ratio is finally awakening and moving above one simply validate the original model that called for a first low 3.8 (actually it was 3/11) and a second low, possibly lower than the 3/11 low on 3/24 (and because of the delay in the first bottom that second window may be extended to as far as 4/06). If we continue straight down, we may get there by the middle of the week. I fear, however that a mild (even though only intraday) bounce might relieve the extreme conditions (and they were not "extreme enough") created Friday and thus extend the Chinese torture for the bulls a little longer.

[Rick Louden]

Kirk, I made similar observation this morning on another board as follows:

I recently relooked at the put/call ratio since 1997. I track the 4 day moving average. On March 15th the 4 day moving average exceeded 1.05 which is quite rare. Since 1997 if one bought the Nasdaq the day following such events, their returns would have been as follows:

.....................Range of Returns........Average Return

One month..............-2%-30%................11%
Two months.............9%-46%................ 23%
Three months..........10%-68%............... 31%
Four months............ 11%-71%...............37%

Of course, as they say, past performance is no guarantee of future performance; but this and other indicators are suggesting we are at or near a low that will give us a good gain over the next few months.

Kirk, Zeev and many others on the Board are quick enough to catch the exact bottom, but for those of us not as nimble, this and other indicators are telling me we are close enough to go long for a swing trade with good odds going for it.

Rick