Notice how today's pivot number 673 act as resistance in a down trend. Conversely, in an uptrend, the pivot will act as support. If the pivot is violated, it signifies a change of trend. Well, what a sick market. One step forward and two steps back is the daily theme. Friday, watch 666 for direction, below it, expect 659 or lower. If above it will try 669, but it has to clear 675 for trend reversal. Therefore, you have an action plan for Friday.
It is only a matter of days now before this down draft will be broken. The 30 min down channel is bullish. As mentioned before, if you are adverse to shorting, park your money in AAPL, RIMM, GOOG Calls.
Have a nice Thanksgiving, although not quite sure what to thank for in the market.
2c
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6 comments:
you mean in a few days we get a dead cat bounce and then go down again.
Dow theory gave a bear signal on Dow. Japan has it's first bear in the topix. Bear everywhere, so every up day is a gift to short.
bigelam
Very interesting comment and that gets me thinking...what is a dead cat bounce...for now, no bounce for anything less than 675, up to 686 and turn back down is a dead cat bounce, it has to clear 691 for a real trend change and of course the more it goes lower, those numbers will go lower. But I won't short at this stage except day trading shorts. Rather day trade AAPL..Calls for if the market reverses those stocks will really fly.
2c
691?? I doubt we see that this year. That's seems like a dream at this stage now. We may bouce to 675 before heading to 640 and then 600.
bigelam
I was hoping to have a one to two day up, so I got rid of my puts before holiday in the morning. Looking at the chart now, it looks horrifying. I am not sure we will get that up day. On the closing basis, we are below the Aug. low, and I see no reason not to tag SPX 1370. We are in a strong downtrend, and in fact, we did not have a 2 up days since Nov 1. We might get there in a big hurry.
Dollar/Yen is the single most reliable indicator for the market I noticed. DXY is hanging on its teeth, and it looks to fall off the cliff any time.
p
I did get some C calls for a quick buck in the morning, and it now looks to me like a real bad idea.
I am sticking my neck out to say, it may bounce a couple of days from now, early next week the latest. RIMM, AAPL and GOOG are turning up on a weekly basis. I may pick up some AAPL calls on Friday or Monday. The banking stocks are risky but then again the market won't bounce without them.
2c
NDX is hanging tough because of the four high beta stocks. I think the next leg down will be led by these stocks. Banking and XLF is beaten bad so far, and shorting BKX and XLF is late. There may still be some money, but risk is high in shorting these. NDX is different, and it is still above 200ma. If we are heading to bear market, which I think we will, NDX is the one to suffer the most from now on. Most of these high beta ones, aapl, rimm, bidu, etc.. only had one leg down, and another leg down will follow.
I guess the alternative is that market is turning up, and these stocks are leading the way up. I need to see 4 up days in the row before I believe it. As for now, whacking the rally seems the play. If we have a up day tomorrow, I am getting out of my calls, and switch.
p
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