Wednesday, August 30, 2006

Oil Slips, Market Blips

It had to happen sooner or later. I'd like to proudly announce the Technically Speaking Shameless Commerce store. There's just a few odds and ends there to proudly display your bearish disposition. Enjoy!

Even though the market rose again (grrrrrr........) my bearish portfolio rose too (hurrah!) mainly because I have so many oil shorts. Oil fell nicely, but it still hasn't broken its neckline. The magic number on the OIH is 130, folks. Go, OIH, go!


Did the S&P 100 double-top as of today? Only time will tell. I think almost everyone who reads this blog is sick of waiting for the market to run out of steam. I certainly am.


The $NDX (NASDAQ 100) is kissing the underside of its former supporting trendline. In fairness to the bulls, it seems the NASDAQ Composite ($COMPQ) overcame a similar trendline today. Here's the aforementioned $NDX.......


If you want to see proof of the volume withering away in this summer market, look at the SPY graph below. It isn't just a "last week of August" situation. For three whole months the volume has been shrinking. How's that for divergence when compared with the price action, eh?


The $VIX is screaming "complacency." It just grinds lower and lower. I guess people expect boredom and smooth sailing until we have active colonies on Mars.


A reader wrote and asked me to take off the bearish headpiece and point out a couple of bullish charts. I'd be happy to do so. The American Stock Exchange's Major Market Index ($XMI) is really good looking. The only reason I wouldn't rush headlong into buying this is because it's a freak. All the other major index charts look neutral at best. But, on its own, this is a fantastic looking chart for bulls.


As for an individual stock, it's not going to make anyone multi-hundred percent gains anytime soon, but Genentech (DNA) has been very firm. A nice saucer shape has been forming.


Now go buy a t-shirt! And I'll see you tomorrow......

38 comments:

Anonymous said...

The SPY graph with the shrinking volume over the last 3 months is interesting.

Im sure will get another up day tomorrow leading into the close of the month.

Waiting ever so patiently for September to come, maybe a real direction is near but for some reason I think we stay stuck in this trading range going into the end of 2006.

Trader 2006.

Anonymous said...

Long BOOM?

Anonymous said...

wow TK, a bullish chart on your blog. Should this trigger the long anticipated downfall in the market.

I am loading up on Jan 07 puts for some the stocks which have risen high such as MOT, NVDA, etc.

I think the market will head higher or stay flat till october. Once the october election is over, watch out .. there won't be any fed money pumping into the market and the market will fall like a rock.

- Jay Mac

Anonymous said...

The elections are in October now?

Interesting.

Anonymous said...

I've tried to trade the last two weeks but I've been bearish and the market is not cooperating. I haven't done much of anything except watch the ticker and hope for a little volatility. Nothing! VIX is flat, most indexes had a big move in two days that I missed and are retesting now, and the Transports are sleeping while oil breaks 70 & 69 intraday. Dow Theory in play maybe? I'm seeing manipulation as a subject as of late. Housing market is slowing??? I'm selling a house and just had a surge in interest lately since rates are down again. 10 year @ 4.76%? Why did I even attempt to trade these last two weeks? And now I'm going on vacation for 2 weeks. 4 weeks of nothing is no way to pay the bills.

J

Anonymous said...

back to basics:

spx and dia 10 day MA has crossed the 20 day MA. nice upward slope also. does not mean it will stay there but it seems that is the current market trend. combined with tim's charts and "room to move" observation i've taken a short term bullish postion.

Anonymous said...

Japan markets up, thats lifting the futures now.
I may just forget about the markets for a while, not because I think they should not move higher but because it doesnt make any sense. Many here will say follow the trend, if the markets are showing signs of strength go long and vice versa but this is just incredible, its getting to the point now where you can buy anything in these markets and make money besides oil which everyone seems to be suddenly bearish on.

Earnings are about 98% done, what is the catalyst that is going to push these markets higher??? Really....Is this the rally that is going to set up for just a major collapse in the market or de we close above 12k at the end of 2006 and push to 13,500-14,000 at the end of 2007. Where is the next catalyst. Dont tell me its lower oil price and inflation slowing down. Thats pathetic. I can name more negative things than positive right now. When everyone is just too bullish its time to sell, and that time I believe will be here in about 1-2 months after that its back down.

PB said...

Just a thought ... let's say all this action was taking place on the downside ... you know, low volatility, shrinking volume and indexes being eroded by 10-20 points a day (the DOW)... what would you conclude from that? I for one would say that the markets were ready for a bounce. So now let's reverse this analogy and see what we have. We have what is happening in today's market ... so it's obvious the next major leg is down. We could see a 100-150 point headfake here, but the underlying picture is definitely bearish. I am still trying to envision how housing market that's falling appart at the seams is actually good for stocks given the recent bull run (last few years) we've had. We've had a summer rally built on low volume ... nothing to get wet about except if you're a bear and are willing to short and hold on.

Anonymous said...

Speaking from far away Brazil, and yes.........I agree the market is slowly turning bearish especially not that the Iran situation is likely to heat up.
But if i can be of any help, buy RIO & PBR adr's, as i have just finished a study on them and they should go up in the near term.

Anonymous said...

there is a gap at 1290 that the SPY's have to fill.

Trader Fred

Anonymous said...

Well, there go the futures. Up yet again. I'm guessing today will be another pretty big day. Will probably close above 11,400 on the Dow and 1310 on the S&P.

Interesting stuff.

Michael said...

re:bonds

Gotta look at them today. Probably close my long positions and look to re-enter on a pullback.

re:gld

See what happens today.

Ditto PCU and PBR.

Michael said...

re:SAFT

IBD pick. buy limit 50.93.

ATR is 1.53. 5-6 pts upside.

Do your own homework.

Anonymous said...

another pathetic day ahead of us. Consumer spending up and savings rate in the US still low. Come on, how long can this Fuc$#@g LAST.

Some guy on the floor said that when the volume comes back and all the big money managers are back from vacation he said the markets should remain bullish into the end of the year expecting a big 4th qu rally. HA

Looks like its getting bad for bears. I think next time I see a huge decline in the markets Ill go long every stock knowing its going to climb back up because no matter what these markets only move up.

By the way Iran said they wont back down an inch....I guess as bearish as it sounds the markets will still close higher today.

Anonymous said...

You know why JApan was up last night,

Industrial production dropped a seasonally adjusted 0.9% in July from a record a month earlier and against expectations of an 0.8% increase.

The data increased expectations Japan's central bank won't increase interest rates again this year.

Anonymous said...

4yr bull run without a 10% correction hmmmmm.

Said if we get past sept/oct without a problem the market should put in a big year end rally. When I hear 99% of the people on CNBC talk about year end rallies its time to sell!!!!

Anonymous said...

There's more than a gap at 1290. We have gaps every where from the last run.

the trader II

Anonymous said...

Market looked like it was going to start turning down than turns around and trades at intraday highs.


HAHAHAH

Trader 2006

Anonymous said...

Trader 2006: Why does that surprise you? That's what's been happening for the last month.

Every little down tick gets bought. Every single one. The daily range on the Dow has dropped to virtually zero. This is the tightest trading range that I've seen for many months.

Sanjay Sola said...

i'm buying on the dip. Big Ben speaks at 12pm and more end of the month buying. and tomorrow should be pretty good. knock on wood. find a stock that's trending up and buy the dip.

Anonymous said...

tomorrow we get job figures.

If there in line say within 15,000-20,000 of the consensus then the markets will most likely have no problem moving higher.

However if we get 50,000 more or less than the consensus you can expect a selloff.

Trader 2006

Anonymous said...

trader II --- perhaps you could tell me where you see those 'other' gaps?

Thanks

Trader Fred

Anonymous said...

CSCO knocking on 22!!!

Anonymous said...

CSCO trading hundreds of thousands of shares at $21.99-$22.00

TOTALLLLLLY STUCK at that price. Im bullish on CSCO think it goes to 23-24

Trader 2006

Anonymous said...

Market waiting for bernanke to speak.

Then it will most likely move higher, why wouldnt it.

Paul

smallswinger said...

On 8/28 my Small Cap Swing Indicator truncated the SHORT signal and moved to a LONG signal.

Here are the recent values of the current LONG signal.

. . . . . .Small
. . . . . . Cap . . . .Russell
. . . . . .Swing . . . 2000
Date . . . Ind . . . .% Chg

08/28 . . +05 . . . +1.1%
08/29 . . +23 . . . +1.2%
08/30 . . +39 . . . +0.8%
08/31 . . +49 . . . +0.1% . . . Intraday @ 12:00 noon EDT)

Normal target for LONG: . . +65 to +75
Normal target for SHORT. . -65 to -75

With the previous SHORT signal being truncated this LONG signal will likely be truncated as well, possibly somewhere in the +50’s.

Personally, I don't trust this LONG signal and am VERY reluctant to go LONG. I'm waiting until September 5th or 6th before I change any positions.

Anonymous said...

Sanjay, what did you buy?

EddieFl said...

We are stuck sideways last couple days,

I think we are getting ready for the next leg up or down on the daily charts.

If anybody is trading the 15 minute charts, they can be making some money even in this enviroment.

Good luck gentleman.

Anonymous said...

Is anyone watching silver? It totally broke out today past resistance at $12.50.

I'm considering buying 1/2 a position now before it takes off tomorrow.

Is anyone else seeing what I'm seeing?

-Tony

Sanjay Sola said...

Funds will probably switch on their robotrader machines as the managers hit the beach.

Sanjay Sola said...

Tony, i was wondering why Silver Standard Resources was moving so much (SSRI).

Is this a cup and handle formation? volume is nice. i don't own it, but i should have bought it.

http://finance.yahoo.com/q/bc?s=SSRI&t=1y&l=on&z=l&q=b&c=

Anonymous said...

WTFFFFFFFF

ANOTHER BORING DAY, ANOTHER UP DAY OF COURSE. Just want to know whats going to happen when the volume returns and we start getting those big intraday moves.

I hope we get a late day selloff.

Anonymous said...

I wouldn't call it a cup and handle. It's more of a straight breakout past the $24 resistance level.

Already at $24.75. Could go a lot higher. I just bought SLV on the breakout, but maybe I should have looked into SSRI, as it moves a lot faster.

Thanks for the heads up.

-Tony

Anonymous said...

BTW, why the hell do I get the distinct impression that the numbers will be "bad, but in a GOOD way" tomorrow???

In other words, horrible numbers will suddenly spark another 100-point up day in the Dow futures tomorrow morning?

I get the sense that the bears are accumulating short positions up here in the stratosphere, but will get squeezed out tomorrow for whatever reason the bulls see fit.

Anyways, I'm once again totally flat on the market. Long SLV only. Will enjoy watching tomorrow from the sidelines.

-Tony

Sanjay Sola said...

Tony,

SLW is a little better than SSRI. check it out. due diligence as always.

i'll buy if it moves past $11 on volume (which i think it will).


http://finance.yahoo.com/q/bc?s=SLW&t=1y&l=on&z=l&q=b&c=

Anonymous said...

bottom line is MARKET IS GOING UP

CATCH IT IF YOU CAN

Michael said...

re: SLV

The time to buy was Tuesday when it bounced off the 50 DEMA. No position.

re: Bonds (TLT)
Hulbert and Ritzholz both calling the long trade crowded. Saw an article in Financial Times about a shift to bonds by fund managers. When they talk their position, it's time to leave (for me). Closed all the bond longs. Wouldn't short since there's maybe 3 pts downside showing on the daily.

Tomorrow. Hmmm? I'm guessing the report will be bullish to neutral, meaning some job growth but not so much as to stoke inflation (at least what the story will be). Question is whether enough traders will be left on the floor by 11 AM to make any kind of market. If there is a huge rally, might put some shorts on. Note that Russell 2000 finally reversed today, positive piece for the bears.

re:OIH

Closed the short yesterday. Looks like it's showing a hammer (as in hammer out a low). Looking for a rally back to the 50 DEMA around 140.50 or the top of the 20 day Bollinger Band around 143. That will be the place to put a short position back on again.

bsi87

Anonymous said...

Yeah, I definitely missed the bounce for silver just under $12, unfortunately. But I did try to play the breakout above $12.50, so we'll see what happens. If the breakout fails, at least I can look to accumulate more at the channel support.

I have no other positions pending. I literally have no clue as to which way the wind will blow. There are plenty of overbought candidates for short positions, but with the market acting the way it has been, I have absolutely ZERO confidence that a selloff will pick up steam. Every little down tick has been bought heavily by the bulls. So, even if you could manage 1-2% on a short position in this market, you better cash in your chips, because it's just as likely to reverse and go green on the day.

I think Sanjay said he was going to start buying the dips. Well, I'm not sure I'm quite at that point just yet. September SHOULD be a horrible month; a bad time to start buying dips, I would think.

But then again, who knows. They could turn on the liquidity faucets again next week and push this market to new highs. It really all depends on what "They" want to do. If they don't want the markets to crash, then they won't crash. Simple as that.

Frankly, I'm still not 100% confident in my SLV position, either. Knowing that "They" want to show that inflation is slowing, then they could really put some significant downward pressure on commodities. I guess we'll have to see what happens.

-Tony