If you trade stocks in the short term, one of things that you need to be very aware of is that sometimes the action that seems extremely stupid is the best way to make money.
If a lot of people with a lot of money are chasing grossly overvalued stocks, it can feel pretty dumb to throw caution to the wind and join the party.
There are reams of sophisticated fundamental analyses out there that purport to establish what a stock is worth. What you need to realize is that the correlation between a stock's 'value' and the price it is trading at is very loose in the short term.
In fact, there can be a complete disconnect between the two for very long periods of time.
If you are going to trade in the short term, you need to decide whether you are willing to do the dumb things that make money or are you going to stick to the "facts" and stand aside while the idiots run prices up and down.
It's all about sentiment, mood and psychology in the short term, and it doesn't pay to think too hard about fundamentals if you are playing in the short term.

James “Rev Shark” DePorre

Charts and Table Zup @ www.joefacer.com

http://www.youtube.com/watch?v=ihvvf1R_vWo

http://www.bloomberg.com/apps/news?pid= ... 6BdHuR9JUU
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http://www.ritholtz.com/blog/2009/08/th ... n-history/
http://www.ritholtz.com/blog/2009/08/about-bailouts/

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Here's the smart move I made in my 401a on the dates shown.



Here's what I missed out on. Ya can't get 'em all right. Rev Shark is right; Trends always move farther than you think they should. I still think there is much more employment misery to come. I still think that there is much more housing misery to come... in time if not in price. And they ain't hirin' everybody back down at the plant fer the Christmas season. As Barry Ritholtz sez "The parachute has opened and we're no longer in free fall. But we're still going down." This is all about the "New Normal." Which I'll write about later.

So I'm chasing a move that has come a long way and can't have much farther to go in its late stages. The upside is limited and the downside is not so much. Hope I get it right..... I'll let you know about it here.


Stay Tooned....

Thursday Evening.....
So far... So good.