economy versus stockmarket correction, page-5

"economy versus stockmarket correction" both are a load of bs, imo! So is anyone who says they can predict daily movements in this type of market.

For example, last night's US plunge in the last hour of trade was entirely engineered by Bear Sterns and then by Cramer who both want the fed to cut rates. Bear Sterns only managed to get the dow down a hundred points. Cramer did the rest with all his commotion. Just check it out: http://www.cnbc.com/id/15840232?video=452808336#

Have you ever seen anyone put on such an act to get the fed to cut rates? If they do, forget the crash! All time highs are more likely by the end of the week, imo! If you see Cramer's video and think now must be a good time to go short, think again!

Bear Sterns are dogie. Their main income is derived from trading their own accounts, and NOT from servicing clients. They just turn the computers on and pull the money out of the market. It works like this.

Two computers will sell to each other - so no nett loss of stock there - but they will walk the price down a tick at a time, triggering stops along the way, and picking up the cascaded automatic stop sells that occur.

In addition, people see the price dropping, and panic sell. These shares are also picked up by the computer doing the buy side. Eventually, a bottom is reached where the price can't be pushed down any further for the day, and the buying computer then takes out the remaining sell side, which is probably why the dow rose near the close.

If you wonder how they do it, these are some of the tools and algorithms they use: http://www.instinet.com/includes2/indexShow.jsp?thePage=/algorithmicTrading/index.html
Similar automated trading tools are available for the aus market. Have you ever wondered what makes those strange sawtooth pattens on the intraday chart? Well now you know!