Well I expected a pop today, but after yesterday I thought we may have already seen the “pop”, we had not. The initial claims and leading indicators both came out bte and gave this mkt. quite the pop. I watched the internals hard, and I saw them weakening and tweeted such, and the mkt. followed, but not near as far as I thought. I suspected we would end in the red today, and it looked like we tried to head that way, but some late buying came in and put a halt to it. Tomorrow is going to be very interesting. We have no real data coming out, other than RIMM tonight came out slightly bte. But its comments were not all that convincing and it sold off a bit after the close. RIMM can be a NAS mover.
This is the VIX on a 60 min. chart. I really thought we would see a little more support offered by the secondary trend line. But then again, the VIX often does its own thing and it did so today. You can see a stall out and slight move up the last few hours of the day, but nothing too impressive. It did close above 30, which may be the missing support line. Let’s watch to see if the 30 holds, if it does that will be bearish for the mkt.
The DOW moved up hard on the bte economic news on very light v. The doji from yesterday do give us a bounce after all. Note the the past support line, that line should be very very strong, and it did not give way today, nor do I imagine it will give way tomorrow. It is a pretty nice little 3 candle reversal we have formed, but not nearly as good as if it had come after a long move in one direction.
Very similar chart on the S&P 500. We did close above a secondary trend line and we did bounce off the 200 ma, which if you recall I was expecting. I think we will need some v to break through as I have been calling for. Tomorrow certainly could provide some extra v as the catalyst to confirm this down move. It is 4f and in an uncertain mkt. you have to wonder how many people are going to hold over the weekend? Also there will be some option selling going on as well.
The possible H&S formation is still in tact. We bounced off the top of the gap, next support at the bottom of the gap. The up trend will now act as resistance, and we could certainly see a move down from here.
This a a 60 min. chart of the QQQQ. You can see my bear flag from yesterday, which didn’t act like a perfect bear flag, but hey it worked. Today we traded within the daily support/resistance zones. If you recall I said the 35.60 area was key and I was looking for a strong move beneath for some more shorting opportunities. Well I thought they were on deck, but they never fully developed. In fact, I didn’t draw it on there, but we have a real nice wedge forming from the last 10 candles. We are in breakout / breakdown zone. Look for another run at 35.60 with some V to confirm the down move.
I tweeted this one early today: 
when it looked like the above chart. Here is how it finished:
Looke pretty bearish eh? I still think we test the top of that wedge, at least around the $14.50, probably lower. Still playable. From there, watch for another move up.
This looks like a decent bull flag to me. Watch for confirmation before playing, but a pop to $22.50 wouldn’t be out of the question.
another tweet, you can look how it finished the day and watch for the break of $21.50 . It actually formed a reversal candle today, so we have to see if it holds true.
Finally I sold all my BZH today near the bottom. It just moved way too much not to lock in the profits, and I thought I may get another chance to play it down again at a better price. I saw it hitting that 50 ma and sold there. This my friends is the way to break support, nice v and strong move down. These breakout trades, when they move as expected, are some of the most profitable, but hardest to time. I was blessed with this trade.
In closing: I see more down side coming. The H&S theory is still in tact, and with 4f tomorrow, and no real catalysts, I can see some selling tomorrow. Or we could chop cabbage all day and end up with sauerkraut. I vote for the down move. AKOT
OOPS!
Tags: GAS, jpm, Nasdaq
I forgot to hit the publish button last night, instead hitting the save button, therefore last nights post was never posted. Now it is. Sorry about that. Now on to today:
Instead of looking long term tonight, I went short term. AAPL and YHOO reported after hours, AAPL bte, but guided lower, as they often do. YHOO, not sure what to make of their E. They are cutting jobs which is good.
Both seemed to move positively in the after hours, but the real test will be tomorrow.
The NDX, in this short term chart, is hitting resistance, perhaps a short term double bottom. It definitely could be poised for a bounce up.
The SP is in a wedge pattern, clearly should be moving down to the 900 area. It is also in the middle of a couple of fibs.
Same chart with the wedge re-drawn. These are 30 min charts. So now it is poised for a breakout, maybe more so to the upside. If you look at the indicators, they both have a bearish slant.
A check on our plays. GAS came back just like we thought. Now we should be looking for the up move. It still hasn’t come all the way to 41.50, but it may not make it there. It bears watching.
And the playable options are definitely out in time. Notice the movement and interest in Jan options. That is what I will be playing. Not great spreads, but not terrible considering the time. The prices got jacked up today, so if it does come back to 41.50, they should be much better priced.
Check out how this thing is just stuck on the 50% fib. It just won’t budge either way. Still, with the decline in v, I am looking for a drop. What makes me doubt that a little is that today we had a pretty good drop and it dropped 2.2%. All indicators still indicate down move.
That is it. Bed time;4:45 comes early in the morning. AKOT