"TAP não sobrevive se se mantiver pública", garante Pinto Luz

[Supermann]

The very center of the wave structure — the most volatile point in an impulse — should occur in 2010 when the market reaches wave iii of (iii) of 8 of 3 of (3) of 3. In a bull market, this point in the wave structure marks the time at which investors in the aggregate stop worrying about downside risk and begin projecting ever-higher levels (for example, by writing books about stocks for the long run and Dow 100,000).

In a declining impulse wave, such as the market is in now, the same point marks the time at which investors in the aggregate stop focusing on the market’s upside potential and start worrying about how far down it will go. This is a very rare event at Cycle degree, and its upcoming occurrence will be stunning enough to set records for financial panic.

I used to call this spot in the wave structure the “point of recognition,” but the Elliott wave model and socionomic theory make clear that investors in the aggregate never consciously recognize anything. It is more accurately described as the point of change in net social mood and directional rationalization.

That’s a mouthful, so I’m just adopting a vanity short-cut and calling it the “Prechter point.” Here is how it comes about: From the start of a bull market, investors become increasingly less pessimistic and therefore act to make stock prices go higher. The center of the wave is when optimism becomes the dominant expression of social mood. From the start of a bear market, investors become increasingly less optimistic and therefore act to make stock prices go lower. The center of the wave is when pessimism becomes the dominant expression of social mood. Thus, as prices rise in a bull market, most investors still worry about downside price potential until the “third of the third” wave occurs, after which they focus on — and rationalize — upside price potential.

Conversely, as prices fall in a bear market, most investors focus on upside price potential until the “third of the third” wave occurs, after which they focus on — and rationalize — downside price potential. Much academic literature equates such biases with levels of concern about “risk,” but investors in the aggregate never evaluate risk and never consciously take risk. Unconscious herding makes investors feel that they are taking non-risky actions, and rationalization comforts them with assurance that whatever action they take is the sensible thing to do….

As wave 3 of c passes its midpoint, expect very bad news to be rampant. Remember how you felt on 9/11? Remember how you felt in October 2008? Those were the centers of wave a and wave 1, respectively. The center of wave c will be scarier than they were.

[Ulisses Pereira]

"Why Sentiment Surveys Aren't Working"

By Jim Cramer
RealMoney Columnist
8/25/2010 11:37 AM EDT

"How is it possible that 66% of the people polled in the Investors Intelligence query are either calling for a correction or bearish, and the market can still go down? That's how the poll numbers shape up this morning. How is it possible that sentiment can be that worthless, and I don't mean that they can't produce a quick bounce like we are seeing today.

I will tell you why. Because there is no true threshold anymore. It isn't like that these negativists, the 31% of the bears and the 35% who fear correction, are going to change their minds. Because of this horrid action, I expect the 33% who like it to keep giving up. I think they have to be saying, these few, these merry 33%, what the heck am I doing in this market when I lose 87 cents a day on my stocks? Why kind of bozo stays bullish in that environment? What bear is convinced that the market's just terrific enough to change his or her mind?

Now I know that history says this can't last and that we have reached an extreme in this poll. Of that there is absolutely no doubt. It is extreme.

I am simply saying that this market is so easy to hate. So, so easy. It is just a miracle that anyone likes it at all.

And so as much as I simply want to wade in blindfolded, betting that the boat is tipped way too high to the bears, I sure would like a reason to switch beyond sentiment, beyond being oppositional, beyond being contrarian. And my issue is valuation. We need more stocks that were bad yielders to be good yielders. We need stocks, not sentiment, to do the conversion. For all I know, the remaining bulls are technically inclined and will hate the head-and-shoulders pattern that Dan Fitzpatrick outlined on my show last night.


So, it is a reason to buy accidental high-yielders only. Not much else. Because who is to say that next week it won't be 31% bulls instead of 33% bulls, because this is the second easiest market to hate after the 2008-2009 market, but we are much higher than that, even as I admit that things are much better than that.

Price could change this. If we go to the lower end of the range and we have a lot of 3.5% yielders that go to 4.5% where they would still be advantaged over Treasuries even after new taxes, taxes that don't apply to retirement vehicles, then be darned those bears.

I want to be as all-in as Doug Kass wants to be. Fitting that he knew to be all-in for the generational bottom. Now that's someone I don't want to be a contrarian toward! "

(in www.realmoney.com)