Rational Speculation

I’m not a big believer in using technical analysis to evaluate stocks. It personally seems like a lot of statistical hocus-pocus to me. But on the other hand, I can’t say that I’m very well-educated in it’s use.

A lot of day traders have been successful using technical analysis when buying or selling stocks. I’ve even read of major fundamental analysts successfully incorporating technical analysis as a efficient way to time an entry or exit into a stock. I’ve even referred to Barchart.com’s technical opinion section myself before entering a few positions.

So while I’m not a big proponent of it’s use, technical analysis does seem to hold some value. However, like all other forms of individual stock analysis, technical analysis is subjective and open to individual biases.

So what’s my point?

I have a dream for this week. Okay, okay, bad holiday joke.

Seriously, I’m actually really stoked to see where the market will lead us this week. I can’t help but feel that the market will continue on it’s downtrend as people further realize that the economy is in dire straits.

But, a weekend review of the stock market blogs (check out my blogroll) and other financial websites leaves me with the feeling that I could be wrong, and that we may be in for a near-term bounce.

Many of the technical traders have been referring to a market that has been “oversold”. According to many of these technical analysts, the stock market is due for a rebound, in spite of other factors and what’s been happening this month. Some have actually posted opinions that this may just be the time to “go long”.

These type of polar opinions are what really makes me excited about the stock market this upcoming week, and I can’t wait to see what happens. I’m hoping we’ll set new lows. C’mon tuesday!