Stop New High Mania!
They just couldn't let us have a triple digit down day, could they? The Dow was down about 115 points earlier, but we closed down 80. Oh, well. Not a bad day, particularly since the media is all ga-ga over the possibility that the Dow is within spitting distance of an all-time high. It would be nice for that not to happen.
My portfolios were up today, but not as much as they might have been if oil had cooperated. OIH was up about 2% as oil and related companies tried to recover from its recent bashing.
The aforementioned $INDU gave back yesterday's gains and is clearly showing some respect for that trendline that it is under.
The $RUT is hopefully stuck in a rut. That horizontal trendline is the "throw in the towel" zone, and we do not want it to cross on the upside. This is a nice bearish engulfing pattern at this point.
More short ideas. Here's DST......
ESRX, offered up a week or two ago, is doing nicely.
As is NVR, also suggested a while back.
One I discovered today was Panera Bread, PNRA.
That's it for now. As always, good luck in your trading.
27 comments:
My Small Cap Swing indicator moved to a SHORT signal early on 9/19/06. Bad news on 9/21 in the Leading Indicators and the Philly Fed Index was actually seen as “bad news” (wonder of wonders) and the markets were down a good measure. Current SHORT signal is at -13 as of Thursday’s close, 9/21.
Here are the recent values of my Small Cap Swing Indicator for the last four switches.
. . . . . .Small
. . . . . . Cap . . . . . . . . .Russell
. . . . . .Swing . . . . . . . . .2000 . . . Cumulative
Date . . . Ind . .Signal . . % Chg . . . . % Chg
08/28 . . +05 . .LONG . . +1.1% . . . . +1.1%
08/29 . . +23 . .LONG . . +1.2% . . . . +2.3%
08/30 . . +39 . .LONG . . +0.8% . . . . +3.1%
08/31 . . +48 . .LONG . . +0.0% . . . . +3.1%
09/01 . . +52 . .LONG . . +0.1% . . . . +3.2%
09/05 . . +62 . .LONG . . +0.8% . . . . +4.0%
09/06 . . -19 . .SHORT. ..-2.1%. . . . . -2.1%
09/07 . . -43 . .SHORT. ..-0.8%. . . . . -2.9%
09/08 . . -61 . .SHORT. ..+0.3% . . . . -2.6%
09/11 . . -72 . .SHORT. ..-0.1%. . . . . -2.7%
09/12 . . +18 . .LONG . . +2.4% . . . . +2.4%
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%
09/20 . . -05 . .SHORT. ..+1.2% . . . .+0.7%
09/21 . . -13 . .SHORT. . .-1.0% . . . ..-0.3%
09/22 . . -13 . .SHORT. ..-1.0% . 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 positions as Friday’s close, 9/15/2006, when the trigger was close to switching.
PS:
Tim, oil is a little too oversold to be betting SHORT, IMO. I think OPEC will support if oil goes below $60, so little potential left.
Re: Stuck RUT - If you look at several indexes on 60min charts, from Sept 14th to the present you can clearly draw a Megaphone Top or Broadening Top (higher highs and lower lows), which is usually resolved to the downside, meaning the RUT target is at least 710, or another -2.3%. I look for a lot more!
Smallswinger,
Does your work predict a follow-through of the downturn today of the indexes-(i.e.DJIA,S&P)-into next week ,and if it shows that, what percent(%)that might be.? I guess today we were down about .8%. You have one of the best and most intelligent contributions to the blog.Just interested in your opinion in the general sense ,however you arrive at that.Thanks !!
Denver
Smallswinger, Thanks for your detailed analysis. I hope your are right about the $rut. I bought oct. puts and am thinking about getting some more. RE:USGL bsi87 what is your exit. Stock seems to be falling on volume,not a good sign?? Goodluck to all! Chris
My history of the Small Cap Swing Indicator has no predictive value, other than to say that it usually reaches the normal maximums +/- ranges, i.e., 65-75. I can say that I usually see a 7-9 day swing and during that swing 2 days on average go the opposite direction of the signal
AUTUMN EQUINOX
Here is a great audio uplift for you bears. Listen to the first part, which details the significance of September 22nd, the Autumn Equinox.
http://www.raymondjames.com/inv_strat.htm
Here's my take on oil, Tim.
The dollar looks to be falling even more, after a short rally. I think it is destined for a big decline, though somewhat choppy on the way down.
When the dollar goes down, crude goes up, since crude is traded in dollars. Even if the demand/supply equation remains static or demand falls some more, an economic slowdown combined with a falling dollar spells some sort of advance for crude oil purely based on exchange values.
dont short DST - they own 30% stake in a subsidiary that is going to be sold to a hedgie at a super premium. multi billion dollar deal. but, you should short it after te deal.
Tim, do not short pnra. Not much volume and wild price swings in both directions will stop you out everytime, trust me from experience. Great site, some nice calls in mot, and shorted cal this morning.
this was a good day for the bears, however if we get a rally tomorrow and we erase every loss today say hello to new highs on the DOW NEXT WEEK. Im thinking more profit taking tomorrow, but not much. Was hoping to close the week out with the NDX at about 1600 but yesterdays rally took that chance away.
Trader 2006.
and oh btw, the end of the month is round the corner. What more it is also end of the quarter. This and the irrational exuberance, I won't be surprised to see 12k by Oct 6th
5:05 12,000 by oct 6th is possible but i doubt it. Are you the one who bought QLD today.
trader 2006.
Any bears still alive?
re:usgl
I'll be looking at the 20 and 50 DEMA as exit points. I can't put sell stops on it on my broker. Staying with the position isn't worth the risk even if it's a small position, I don't want to baby sit it.
bsi87
This pullback looks like a nice buying opportunity. Any comments
yes, if you're buying PUTS !!
To anonymous (bull): Buy MZZ, QID, SDS, and DXD. You will do well!
My Small Cap Swing indicator moved to a SHORT signal early on 9/19/06. Bad news on 9/21 in the Leading Indicators and the Philly Fed Index was actually seen as “bad news” (wonder of wonders). The current SHORT signal is at -39 near 9/22 mid-day.
Here are the recent values of my Small Cap Swing Indicator for the last four switches.
. . . . . .Small
. . . . . . Cap . . . . . . . . .Russell
. . . . . .Swing . . . . . . . . .2000 . . . Cumulative
Date . . . Ind . .Signal . . % Chg . . . . % Chg
08/28 . . +05 . .LONG . . +1.1% . . . . +1.1%
08/29 . . +23 . .LONG . . +1.2% . . . . +2.3%
08/30 . . +39 . .LONG . . +0.8% . . . . +3.1%
08/31 . . +48 . .LONG . . +0.0% . . . . +3.1%
09/01 . . +52 . .LONG . . +0.1% . . . . +3.2%
09/05 . . +62 . .LONG . . +0.8% . . . . +4.0%
09/06 . . -19 . .SHORT. ..-2.1%. . . . . -2.1%
09/07 . . -43 . .SHORT. ..-0.8%. . . . . -2.9%
09/08 . . -61 . .SHORT. ..+0.3% . . . . -2.6%
09/11 . . -72 . .SHORT. ..-0.1%. . . . . -2.7%
09/12 . . +18 . .LONG . . +2.4% . . . . +2.4%
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%
09/20 . . -05 . .SHORT. ..+1.2% . . . .+0.7%
09/21 . . -13 . .SHORT. . .-1.0% . . . ..-0.3%
09/22 . . -39 . .SHORT. . .-1.2% . Intraday @ 11:45am ET
Normal LONG target: . . +65 to +75 (max: +95)
Normal SHORT target: . -65 to -75 (max: -107)
I remain 100% invested in SHORT positions as Friday’s close, 9/15/2006, when the trigger was close to switching.
Here we go down the mulberry bush, the mulberry bush, the mulberry bush. (mulberrybush = equity markets)
re:PXP
Stopped out for a 8% gain in a week.
re:BMY
Stopped out for a 5% gain.
Nothing too exciting. Mkts aren't high enough to put on shorts nor low enough to go long.
Have a buy limit order in for PEIX at 14.75 GTC.
re:OIH. P&F chart shows 118 target. Expect that early next week and I'll cover for now or hedge for a bounce.
ZZZ. LOL.
bsi87
costas thank you very much for that nice article. Will print that one out.
Great day for the bears, this follow through is what we needed.
QID is doing great today!!!
Trader 2006.
just read an article saying Proshares is coming out with, GET THIS, 66 NEW ETFS. Ill post in a few.
Trader 2006.
How much of a factor will next week being the last trading week of the 3RD quarter be a factor it's direction next week ? I don't know ,but if it were not for that fact and also this being Fri.,I would be tempted to pull the trigger aggressively on some S&P puts.Today surprises me as well as we are getting pretty good follow through on yesterdays decline.Mortgage Lender stocks look good for big declines.Safer than betting against the indices.
Tim, now that OIH is breaking into the $123 mark, where will you reset your stop loss to? Would you do a contigent or trailing?
Thank you for you insight!
K
PPT in action. I think next week we will head higher irrespective of the reports. Anyways whats the authenticity of these reports, they are already skewed.
re:PEIX
long at 14.78.
Do your own homework.
sold half of my QID at $63.15 after buying it at $62.05. Still own QID and waiting for 66+++
Will buy more QID around $60.50-$61.50.
trader 2006.
I'm starting to believe next week the market goes to test the high and it should fail.....
I just smell it....
1:24 i hope so, ill take some more QID under $61.00
Trader 2006.
Some of you need to pay closer attention to the sequence of events this week. After the FED paused on rates again (Wednesday) and tried to muster some tough inflation dialog, the market psychology shifted.
That is why the markets fell so hard on Thursday. All of a sudden, the FED and interest rates become last year's girl friend -- no longer interesting. What was now interesting was the economy and future earnings. And suddenly, bad news became just that -- bad!
The negative Leading Index and the VERY negative Philadelphia Index were viewed on Thursday in this new light: Bad News IS Bad News.
Next week brings the following
economic reports: Existing Home Sales and New Home Sales, Consumer Confidence, Durable Orders, Initial Claims, Personal Income, Personal Spending, and the Chicago PMI.
Somebody tell me which ones will be "good news"? Maybe Personal Income. They could all be bad. I know a few of them will be VERY BAD.
If the markets rally and advance to the upside next week it will be due to market intervention, plain and simple.
In the new light of "Bad Is Bad" I'm betting on a down week next week. And I have put a lot of money on it.
Somebody tell me why I'm wrong. Don't tell me THAT I'm wrong. Tell my WHY I'm wrong. Not that easy, huh?
I don't trust the wisdom of crowds, particular whatever wisdom is allegedly in the market. Smallswinger, I suspect that the market will stay optimistic until incontrovertible data chips away at its collective conviction that the economy will glide (hope) rather than skid (probable?) lower. Last week the market was kicked in the stomach with the Philly Index report. A pin prick to wake a few out of their dream state of economic bliss. (NY) shows strength. I just saw a terrific graph in one of my paid subscriptions (Peterdag.com). Shows GDP pegged to housing. Housing is the leading indicator, and we all know where that is leading. My short positions are red currently, but I'm anticipating that they will correct. I picked up some OS NOV 50 puts--of course it went higher, but it is now rolling over a bit with the Philly news. Good luck on your positions next week.
Post a Comment