http://www.thestockbandit.net/2006/06/28/limited-upside/ Trading blog with trading insights, discussion on swing trading, day trading, and trading psychology. Wed, 20 Aug 2008 15:07:45 +0000 http://wordpress.org/?v=2.0.9 http://www.thestockbandit.net/2006/06/28/limited-upside/#comment-1275 Thu, 27 Jul 2006 02:13:41 +0000 http://www.thestockbandit.net/2006/06/28/limited-upside/#comment-1275 [...] Trapped bulls sell into strength once the market tops out. This is what we’ve been seeing since May and even saw another round of it last week with a big rally followed by two more days of selling. Bulls who bought on the way down at perceived ‘value’ levels (valuation, schmaluation!) almost instantly saw their positions turn into losers, and as the downtrend continues it provides additional pain for them. Once a relief rally or even just a bounce begins, they are tempted to sell into the strength just to alleviate their pain and take smaller losses than what they had been facing. This essentially caps the upside of the market, and is why upside has been so limited the past couple of months. [...] […] Trapped bulls sell into strength once the market tops out. This is what we’ve been seeing since May and even saw another round of it last week with a big rally followed by two more days of selling. Bulls who bought on the way down at perceived ‘value’ levels (valuation, schmaluation!) almost instantly saw their positions turn into losers, and as the downtrend continues it provides additional pain for them. Once a relief rally or even just a bounce begins, they are tempted to sell into the strength just to alleviate their pain and take smaller losses than what they had been facing. This essentially caps the upside of the market, and is why upside has been so limited the past couple of months. […]

]]>