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Lionel,
You may well be right. I have observed similar patterns in Compuserve's
Investors' Forum. I noticed that if posts were fireworks, that would mark
a top which occurred for some in gold Feb 1996, and of course the opposite
can be true for the bottom. I like to follow NYSE short
interest. Historically, a crash never occurs after short interest reaches
record levels, instead it may be the mark of a bottom. Interesting is that
NYSE short interest reached record levels in March, and broke its record in
April, broke that record in May, broke again in June, and still it did
broke its record in July. In the same time the market went sideways if not
slightly up. A short covering rally can perhaps take us to February
highs. Besides all these I use RSI 14 on the weekly chart on SP500. It
was oversold in early April. The last time the indicator was at these
levels was 98 October.
Best to you all.
Murat
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