This is why I follow trends - it takes all the day to day emotion out of it.

We had confirmation of a new bull market trend in May/June 2003 on the DOW and this trend was intact until confirmation of a new bear market in first week January this year (with a warning August 2007 that something might be about to crack).

So far despite the day to day moves the trend is clearly DOWN still - nothing has changed since January (only a bubble in commodity, materials, oil&gas held it higher until June).

Pull up a weekly chart, draw a few moving averages and look at the trend on the DOW, S&P and Nasdaq.

Gold bugs should do the same on gold - while they have been bleeting about gold being the saviour the trend is down in a new bear market for it since August while the dollar they bash is in an uptrend - they missed making money. When/If these reverse then reverse positions.

Focus on weekly trends and not daily or last hour moves and watch for the next bull market, picking bottoms isn’t the way to make money - it is knowing when the trend has changed direction and REACTING to it - NOT PREDICTING. Nobody can forecast the future.

The trend is your friend, but patience is needed to wait for them and to stay with them - but thats where the big money is made, not in trying to pick “the bottom” (or the top).

Related Posts:

• A Dip or a Drop?
• Every technician is watching that H&S pattern on the S&P and the Dow.
• Short and Sweet Moving Average Analysis - It’s Just the Price!
• The markets may start to collapse next week.
• If we see 11,000 on January 4th I will not argue.

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