Farley Hits It On The Head!
April 3, 2008
Words of wisdom from another experienced technician:
Bottom-calling is a popular sport on Wall Street these days. It’s one that I played with great enthusiasm in these pages back in 2002. But frankly, I don’t really care this time around, because I’m more focused on my profit-and-loss statement than on earning brownie points or bragging rights with my peers.
Simply stated, we won’t know for months if the January lows marked the lows of the steep decline off October’s multiyear highs. So why try to guess? Here’s a reality check: If you knew the answer here and now, would that affect the way you trade the financial markets? For me, that knowledge wouldn’t change a single thing I do in my daily routine.
That’s the difference between market speculation and market as spectator sport. We can get so caught up in the entertainment aspect of this business that we forget that the only thing that really matters is buying low and selling high. So, while blasting the uptick rule may be fun, piggybacking the hedge funds as they raid vulnerable stocks is even more fun.
–Alan Farley, thestreet.com
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