Which stocks are too far ahead of their numbers...??

There are several signs in the stock market that suggest caution, even though they're all very bullish. Here are some of them and what they might mean, based on past experience.

First, everybody's bullish. If everyone's bullish, that means they've already bought their stock and are hoping more people will follow their enthusiasm. Most individual investors are fully invested. And as long as large inflows are still going into equity mutual funds, everything's fine. Watch out when the flows turn into trickles. There won't be buying power to keep boosting stocks.

Second, fear of the Economy/Political scenario. This is an initial indicator, which would pull of sporadic selling that could eventually mount into an outright bear market.

Third, new records for the SEBI week after week. Thats exuberance and won't continue. The technology sector is leading this market, and there's plenty of growth ahead for the group, but the pricing for many of the tech stocks is way ahead of the earnings. Most of the tech stocks are priced to perfection, meaning that if they don't report earnings above the analysts' expectations, they'll be in for a bashing. Too much good is already priced into many of these stocks. Fourth, a record season for IPOs. While there's always been a push to get financing done when the market is upbeat, this last penultimate (second last) season had been one for the records. Records never last. That's not how the market works. The penultimate season saw IPOs such as Hughes Software, HCL Technologies being subscribed several times over, with premium listings as they opened. This was followed by dismal erosion of value for those IPOs. What followed is issues such as Ajanta Pharma, Cadilla etc, opened at deep discounts. Two emotions drive markets: fear and greed. Usually there is some fear and some greed. Markets usually do best when they climb a wall of fear, meaning that every one expresses fear of investing but stocks continue to go higher. When that sentiment changes to bullish, the market roars ahead. Because the market is depressed, the next psychological state will be fear, and there will be a pull back, nothing severe.

This great economy isn't going to stop growing, but many stocks are too far ahead of their numbers and will be pulling back when the market has a bad day.

hello..
each & every technical person will evaluate a chart in a different way..each one perceives ,understands & interprets to his/her way of understanding....
the same is with FA.....pe,eps or any such no's has its own way of interpreting...
for e.g if xyz co has eps of 150 , how will u look open it when investing ?
wise to invest or stay away ? u will say its wise as eps is high , but i will look upon it has the maturity stage of the company(or to say its business cycle) and so would think that the business activities will now consolidate for time period...this is just an example abt the individual perception :
dont matter abt bull or bear market , a good company discounts all shakeouts.
(like DOW theory discounts all internal & external information)
i m not a FA guru, but have learned lot from my dad as he is investor and i am a more of a trader ..
few tips while doing investing
1) invest in 'A script' and to extent mid caps(very imp.). even avoid ipo's,new companys(classic eg : rpower : company gonna start actual operation 2-3 yrs from now, till then just speculation moving the stock price up & down)
2) look out the MF's investment into the stock,month to month data
3) compare the y2y net profit, eps, pe , assets, dedts,credits..etc(must learn to read balance sheet) of the co...for past years and analysis the companys performance...
4) always read chairperson speech : it gives prospects of the co's past,present & future business in brief.
5)avoid tips,operator based scripts..(look for delivery volumes on day to day basis in the co u have invested, if delivery volumes r decreasing gradualy and still price is skying up, there is something fishy
& many such details u need to gather before investing.Like TA , FA takes lot of time & study ..
always remember : a trader aim is earn from price difference and an investor aim should be to earn from dividend, bonus ,not price difference
then it wount be hard for u to find out the co's which are ahead of price & vice versa..
regards
harsh