Wednesday, September 05, 2007
Bull vs Bear (5 Sept 2007)
A bigger jump in the number of bulls vs bears. Is it time to buy? I think this depends on your personality and the type of system that you are using.
The daily chart shows that all downtrend have been broken. Indicating the worst is over. But it is just under 1300 and also the maximum Fibonacci level for a rebound. So depending on your system, you could be selling or buying. Remember, for every trade, one side is bull and the other side is bear. Each side will see different things.
I prefer the longer term weekly chart. Not that much noise, that means less trade to perform. As one can see, it is still considered to be in consolidation (bull scenario). It could also mean bearish rally (bear scenario). The signals all are contradicting each other.
As the chart has no clear answers, that means I don't know whether the bull or the bear is stronger. That's why I choose to stay sideline.
This write up is to show that technical analysis is just a tool, interpreting and executing will require experience.