Monday, October 16, 2006

It Must Be Frustrating.....

The closely-watched Dow Jones Industrial Average peaked at 11,997.10 today, a minuscule 2.90 points from the fabled 12,000 mark. At this point, it seems almost a foregone conclusion it will cross that level. I'd like to get it over with. It must be frustrating for all the media waiting to announce this big event.

The market reminds me of a popular toy from my childhood......


Given Friday's long, chart-rich post, this is going to be a short one. Here's the latest on the $SPX. There's plenty of overhead resistance from early 2000, and we seem at the highest reaches of a channel at this point. The fans you see traversing the screen date back to the Great Depression.


Fluor (FLR) looks pretty decent as a short to consider.


I've been short the Morgan Stanley Tech Index for a long, painful time. This one's been nasty. The stop is pretty obvious (and pretty close.......)


LUFK is another idea to consider for you shorties.....


If you want to bet against the red-hot REIT market, the IYR is a good way to do it. There are plenty of puts out there........not heavily traded, but not so thin as to be impractical.


This week earnings will be coming in hot and heavy. Apple, Yahoo, Google......tons of stocks. Should make for some clearer direction.

10 comments:

Tim Knight said...

Wow. Just 1 comment. I guess the market has left people literally speechless.

Barry Webb said...

Three stocks I've been following seem way overbought - CMI, RIMM, and MSTR. Look how high above the weekly EMA those stocks are! I've already been burned a few times shorting into an uptrend - it is difficult to pick tops in this market. The problem is, I can't get long either because they keep going up, up, up without a pullback. That's frustrating.

The oil stocks have been good short candidates lately - FTO, KWK, NOV, DO - been even they have made a turnaround. It is difficult to pull the trigger. Add to that the earnings season, and maybe it's best just to sit on the sidelines awhile.

chronictown said...

My $rut puts are at 00.30 cents. Whats a girl to do?? Im gonna go long in gold and the miners. I feel likewhen this thing tanks and the dollargoes to the poop house, gold should be steady, A safe place.tired of fighting this beast!Thanks for the great work Tim.

Leisa♠ said...

I was listening to Puplova, and I heard something which made me gasp...he referred to Lowery's letter saying that the decline (which he was forecasting) was merely a correction in a bull market. Sine Barry R has quoted him, I've asked him to re-connect. Perhaps I misheard. But there is a lot of head scratching from some very smart folks (present company included). I'm happy to see BAC have a negative day at least.

Jennifer Owens said...

"Until someone or something sticks a stake in it's heart it's gonna just keep going."

Did Goldman go full short yesterday and then stick a stake in the vampire's heart by downgrading INTC.....What a freaking joke this has been......hype till the day before the flop?

Andrew Wright said...

Here is why this is a tough market....

Because like today, the futures gapped down hard.... so do you chase the weakness or buy it? I picked neither!!!

I think we are having a shakeout today and maybe for the rest of the week... at which point no doubt everyone will become bearish. The positions that I want to go long in will hopefully set up by then....

I think the trend is up until elections are over.....

But with so many people thinking that equities do best between Nov-May....watch out in November. Much like equities do worst in September and October....

smallswinger said...

My Small Cap Swing indicator switched to SHORT on October 11. The LONG signal ended at +70 on October 10th. This SHORT signal is at -11 as of October 17, intraday.

Here are the recent values of my Small Cap Swing Indicator for the last four or five switches.

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

09/12 . . +18 . .LONG . . +2.4% . . . . +2.4%(short-covering)
09/13 . . +41 . .LONG . . +0.8% . . . . +3.2%
09/14 . . +54 . .LONG . ..-0.4%. . . . . +2.8%
09/15 . . +65 . .LONG . . +0.2% . . . . +3.2%
09/18 . . +70 . .LONG . . +0.0% . . . . +3.2% (short triggered)
09/19 . . -06 . .SHORT. ..-0.5% . . . . -0.5% (& confirmed)
09/20 . . -05 . .SHORT. ..+1.2% . . . .+0.7%
09/21 . . -13 . .SHORT. . .-1.0% . . . ..-0.3%
09/22 . . -37 . .SHORT. . .-1.2% . . . ..-1.5%
09/25 . . -43 . .SHORT. . .+1.2% . . . ..-0.3%
09/26 . . -39 . .SHORT. . .+0.4% . . . ..+0.1% (long triggered)
09/27 . . +17 . .LONG . . . +0.4% . . . . +0.4% (& confirmed)
09/28 . . -19 . .SHORT. . .-0.4% . . . . -0.4% (whipsaw short)
09/29 . . -25 . .SHORT. . .-0.6% . . . . -1.0%
10/02 . . -48 . .SHORT. . .-1.5% . . . . -2.1%
10/03 . . -64 . .SHORT. . .-0.1% . . . . -2.2%
10/04 . . -49 . .SHORT. . .+2.1% . . . . -0.1%(short-covering)
10/05 . . +40 . .LONG . . . +1.3% . . . . +1.3%(whipsaw long)
10/06 . . +54 . .LONG . . . -0.4% . . . . +0.9%
10/09 . . +66 . .LONG . . . +0.6% . . . . +1.5%
10/10 . . +70 . .LONG . . . +0.2% . . . . +1.7%
10/11 . . -06 . .SHORT. . .-0.6% . . . . -0.6%(new signal)
10/12 . . -02 . .SHORT. . .+2.1% . . . . +1.5%
10/13 . . -00 . .SHORT. . .+0.7% . . . . +2.2%
10/16 . . -00 . .SHORT. . .+0.8% . . . . +3.0% THIS HURTS!
10/17 . . -11 . .SHORT . . .-1.2% . Intraday @ 11:30am ET

Normal LONG target: . . +65 to +75 (max: +95)
Normal SHORT target: . -65 to -75 (max: -107)

I remain 100% invested in SHORT small cap positions as of Friday’s close, 9/15/2006 (RUT=729.35 to 759.05 on 10/17, a +4.1% advance). I have lost too much since going fully SHORT, but just cannot go long at such extended technicals.

Too much money supporting the GOP election drive. Markets will likely remain extended til the elections are behind us – then watch out.

Doug said...

does anyone know of any options traders who have blogs that deal with mainly expiration week plays?? i am also curious your opinions on the new option weeklys on the DOW and S&P?

Andrew Wright said...

As I was saying at about Noon, this is ridiculous....... Anyone who was short and didn't cover this morning, might get hurt by tomorrow....Unless you picked the right stock. Apparently bears aren't allowed to eat dinner anymore.... earnings tonight are meh..

Now I've got a list of longs/shorts....now if the market would cooperate......instead of gappy down 30-40 points or up that much.

Elections are Nov. 7...patience.

Jennifer Owens said...

Pre-announcing DOW 12K for tomorrow.....INTC and IBM will ensure that.......