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For your consideration, as we all await the Fed announcement (and the predictable crazy up-and-down hysterics for 30 minute afterwards). Arch Coal. Looks like a nice clean short. Stop price is anything above 78.60. It had a terrific run-up and seems to have tipped its hand clearly......the symbol on this one is ACI, and yes, there are options.
http://photos1.blogger.com/blogger/4311/970/400/0329-aci.jpg
at 3/28/2006 4 insightful comments
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Monday, March 27, 2006NZD/USD (One more time!)
The market is boring me to tears, and until we get the silly Fed business out of the way, I just don't want to talk about it. So how about a blast from the past?
This is the only FOREX trade I've ever recommended, but it's done fantastically well. I haven't looked, but I wouldn't be surprised if this was the best FOREX trade over that entire period:
http://photos1.blogger.com/blogger/4311/970/400/0327-NZD.0.jpg
What I want to point out to all the nay-sayers that visit this blog is the following: I was early on this recommendation. If you had checked the recommendation at various points after it was made, you could have said I was dead wrong. And the trade was a loser.
But the broad trend was there. And in the end, the broad trend crushed the little ups and downs, and my analysis was right on the money. It was a little early, yes. But it was ungodly profitable.
Something to keep in mind on those days when the Dow squeaks out a gain and people have Dow 19,000 on the brain.
at 3/27/2006 6 insightful comments
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Saturday, March 25, 2006Masquerade Bull
You won't recognize me today because I've stuck these bull horns on top of my furry head. I want to make an earnest attempt to make a bullish argument for the market, since I think taking an opposing view is probably healthy. I'm still a bear at heart (albeit less passionately so, given the market's frustrating behavior), but let's take a look at some charts which point up instead of down.
First, there's the Major Market Index ($XMI) from the Amex. This index is pretty unusual in that instead of ascending, pushing up against a resisting trendline, it's formed a nice inverted head & shoulders formation. It just barely sneaked above the neckline recently, but should it clearly break above this neckline, it could mean a clean run up to about 1,180 (its all-time high) based on traditional measurement methods.
http://photos1.blogger.com/blogger/4311/970/400/0325-xmihs.jpg
Argument number two is the fact that the market isn't seeming to "break", even in the face of a lot of bad news. We've got a war going badly. We've got what was formerly the mightiest corporation of the planet (GM) teetering on bankruptcy. We've got personal bankruptcies at an all-time high. And we have interest rates which have blasted higher and have taken the steam out of the housing market.
So where's the collapse in the stock market? Nowhere (yet). Here, for instance, is a chart comparing interest rates (black graph) to the S&P 500 (blue graph). Notice that the stock market not only doesn't seem to care about the higher rates, it actually seems to defy them!
http://photos1.blogger.com/blogger/4311/970/400/0325-tyvsspx.jpg
Argument number three is the recent breakout of the Dow 30. For many months it was pushing up against resistance. It has broken above this resistance, and it has not gone beneath it. So the upward line that was resistance is now support. I'd mention the same thing happened to the Russell 2000 on Friday.
http://photos1.blogger.com/blogger/4311/970/400/0325-dowbreakout.jpg
Lastly, a similar argument for the NASDAQ Composite. Besides the breakout, it's even got a cute tiny inverted H&S pattern above the breakout, which also suggests an upward push.
http://photos1.blogger.com/blogger/4311/970/400/0325-compqbreak.0.jpg
My bearish hope is that all of these charts represent the "last gasp" in the bull market we've seen over the past three+ years. But until and unless the prices clearly exhausted themselves and change direction, it's going to remain a frustrating, day-by-day wait.
at 3/25/2006 9 insightful comments
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Anyway, here are a few charts to chew on. First up is the Amex Major Markets, symbol $XMI. This is actually a pretty hefty inverted head and shoulders pattern (not shown here) which, if broken to the upside, would be very bullish (yes, bullish) for this market. Indeed, the price did cross above the neckline: but it took the very bearish behavior of slumping back below the line and, since then, sinking further still.
http://photos1.blogger.com/blogger/4311/970/400/0323-XMI.jpg
The Dow Transports (The Dow 20 to those really in the know.....) has been profoundly strong, but it, too, lost its grip on its ascending trendline and took a dive (these are intraday charts of about the past ten days).
http://photos1.blogger.com/blogger/4311/970/400/0323-Tran.jpg
Next is the S&P 500. Same deal. Ascending trendline. Couldn't keep the momentum. Started falling. It's going to have to punch through Wednesday's low, however, to get exciting for the bears.
http://photos1.blogger.com/blogger/4311/970/400/0323-SPX.jpg
Lastly, the NASDAQ 100 ($NDX). Considering the weakness today, this one was stronger than I'd like to see. As with the S&P 500, this index has to punch below recent lows (in this case, March 10) to get serious about a downfall.
http://photos1.blogger.com/blogger/4311/970/400/0323-NDX.jpg
at 3/23/2006 8 insightful comments
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Tuesday, March 21, 2006Failed Breakout - Hurrah!
Today was a really interesting one. The Dow pushed higher by about 50 points, started weakening, and never looked back. It wasn't a collapse by any stretch - - the Dow closed down 39 points - - but this kind of "pop and drop" day is wonderful, particularly since it's demoralizing to the bulls.
Let's first look at the S&P 500 index. Take note of the blue trendline above the prices (resistance, obviously). See how the prices are progressively unable to touch (let alone cross above) the line. Finally, see how the prices give up and surrender away from this line.
http://photos1.blogger.com/blogger/4311/970/400/0321-SPYIntra.jpg
The intraday chart of the Dow is similar, except this index shows more strength. In fact, it pushed itself to a new multi-year high today, only to see it exhaust itself early and start the descent.
http://photos1.blogger.com/blogger/4311/970/400/0321-DIAIntra.jpg
The longer-term view is what really counts. Below is a daily graph of the Dow 30 going back more than a year. As you can see, the prices did in fact move above an important resistance line a few days ago. If this line holds, it could be bullish for the market (hissss). If today's weakness follows through and pushes prices back below this resistance level, it invalidates the breakout altogether.
http://photos1.blogger.com/blogger/4311/970/400/0321-DIA.jpg
at 3/21/2006 9 insightful comments
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Monday, March 20, 2006Shorts!
Symbol: ATI
Why? This has been part of the super-hot steel sector. The run-up has been huge, and my feeling is that the trend has reversed here. Possible double top.
Close If Price Crosses Above: 58.45
http://photos1.blogger.com/blogger/4311/970/400/0320-ATI.jpg
Symbol: APC
Why? Good day today on this one (I bought puts last Friday). APC is one of the high-fliers in the oil sector. I've got a bearish view on crude oil, which flows into this suggestion. A break beneath its ascending trendline would obviously mean fireworks.
Close If Price Crosses Above: 101.03
http://photos1.blogger.com/blogger/4311/970/400/0320-APC.jpg
Symbol: BNI
Why? Double-top and part of the richly valued transporation sector.
Close If Price Crosses Above: 81.72
http://photos1.blogger.com/blogger/4311/970/400/0320-BNI.jpg
Symbol: RIO
Why? Head & shoulders pattern which has broken its neckline and retraced back to it.
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Close If Price Crosses Above: 45.9
http://photos1.blogger.com/blogger/4311/970/400/0320-RIO.jpg
Symbol: ESRX
Why? High-risk trade here, folks! This is a white-hot stock but I think it's out of steam. (Of course, I felt this way about HANS which has continued to shoot higher).
Close If Price Crosses Above: 92.95
http://photos1.blogger.com/blogger/4311/970/400/0320-ESRX.jpg
Symbol: FLR
Why? Very nice "lower highs/lower lows" pattern. Suggests a change in trend.
Close If Price Crosses Above: 85.58
http://photos1.blogger.com/blogger/4311/970/400/0320-FLR.jpg
Symbol: HP
Why? High-flying oil service sector stock which seems to be in a clear downtrend now.
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Close If Price Crosses Above: 67.87
http://photos1.blogger.com/blogger/4311/970/400/0320-HP.jpg
Symbol: IWM
Why? The ETF of the Russell 2000 index, the trendlines I've drawn plainly show this index is pushing hard at its resistance levels.
Close If Price Crosses Above: 74.50
http://photos1.blogger.com/blogger/4311/970/400/0320-IWM.0.jpg
Symbol: QQQQ
Why? A head and shoulders in formation, mentioned a couple of times in this blog recently; a break beneath 40.16 would be fantastic for the bears.
Close If Price Crosses Above: 41.92
http://photos1.blogger.com/blogger/4311/970/400/0320-QQQQ.jpg
Symbol: PD
Why? This is also a head and shoulders in formation. It has broken beneath its ostensible neckline, only to push back above it again. But at these levels, it's a relatively low risk/high reward trade.
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[ 本帖最后由 hefeiddd 于 2009-5-12 16:06 编辑 ]
Close If Price Crosses Above: 76.80
http://photos1.blogger.com/blogger/4311/970/400/0320-PD.jpg
Symbol: UTH
Why? Similar to the NASDAQ 100, this index has formed a very nice head and shoulders formation and is clearing below its former uptrend. I've mentioned this one before. Again, it's got to break the neckline to have meaning. But it's a honey of a pattern.
Close If Price Crosses Above: 116.22
http://photos1.blogger.com/blogger/4311/970/400/0320-UTH.jpg
Best of luck, everyone. It's tough out there! Keep your eyes on the prize.
at 3/20/2006 6 insightful comments
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Thursday, March 16, 2006Hope Springs Eternal in the Bearish Breast
The "Ten Year" post (below) is more interesting than this one, but I wanted to at least mention that today's QQQQ shows a nice bearish engulfing pattern. I've highlighted other recent instances of this candlestick pattern. It doesn't always precede a fall, but it's a pretty good clue.
http://photos1.blogger.com/blogger/4311/970/400/0316-Engulfing.jpg
Of course, what we want to see this lead up to is a break below 40.16 on the QQQQ, which will turn this into Peanut Butter Jelly Time.
at 3/16/2006 10 insightful comments
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Thursday, March 16, 2006The Ten Year View
I remain confounded at the market's rise, but you can't argue with price action.
I would like for you to look at a view I usually don't show here - the ten year view - of these various markets. I'll say very little about these, relying on you to draw your own conclusions. Remember that clicking any image makes a larger one come up. These graphs were up-to-date as of the market's close March 15, 2006.
Here, first, is the Dow Jones Industrial Average. You can see an array of Fibonacci fans (which are actually coming all the way back from 1932) that help us see where prices are "clinging". The recent year's price action has been unusually strong, but you can still see the minor resistance line I've drawn.
http://photos1.blogger.com/blogger/4311/970/400/0315-INDUTen.jpg
Next is the Russell 2000, which has been especially stong lately. Prices are up against the limits of an ascending wedge.
http://photos1.blogger.com/blogger/4311/970/400/0315-RUT.jpg
Next is the S&P 500 which, like the Dow, has Fibonacci fans from very long ago shown on it as well as the more minor year-long resistance level.
http://photos1.blogger.com/blogger/4311/970/400/0315-SPXTen.jpg
Now just look at the Dow Transports. Does anyone besides me think these are just a touch pricey? That the graph is basically a hockey stick? Incredible. Notice, however, in spite of its rise, how it is already on the "wrong" side of its ascending trendline.
http://photos1.blogger.com/blogger/4311/970/400/0315-TRAN.jpg
The Dow Utilities, mentioned here about a week ago, seem to be prone to breaking a head & shoulders formation; this index is already on the bearish side of its major ascending trendline.
http://photos1.blogger.com/blogger/4311/970/400/0315-UTIL.jpg
And last but not least is the volatility index, the VIX. The sea change here is that the "fear" levels remained in a consistent range for years and years. But in the past couple of years, the VIX has plunged to never-before-seen lows, indicating a level of confidence (or complacency, if you prefer) never before witnessed.
http://photos1.blogger.com/blogger/4311/970/400/0315-VIX.jpg
My dread fear is that we poor bears are going to wind up with the mindset Abbie Hoffman was in when he wrote his suicide note: "It's too late. We can't win. They've gotten too powerful." Nooooooooooo!
at 3/16/2006 10 insightful comments
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Tuesday, March 14, 2006Waiting for Godot
Sigh.
Well, the market was quite strong again today. The ETFs SPY (S&P 500) and DIA (Dow 30) hit record highs.
It always seems just when the cup of doom is handed to the bears to drink, it gets snatched away (OK, not sure where that peculiar metaphor came from, but it has a certain ring to it!)
Below is, once again, the QQQQ shown in its head & shoulders formation. The neckline is as plain as day. The price has scurried away from the neckline, and until it breaks it, the head & shoulders is just "in formation" and otherwise meaningless.
http://photos1.blogger.com/blogger/4311/970/400/0314-QQQQ.jpg
One buy recommendation I was going to suggest two days ago (honest!) was Google. The reason is that this stock does a smashing job "obeying" its Fibonacci retracement levels. I've noted them below with red circles.
It had been beat up so badly last week by bad news that it was right up against support. It has since moved smartly upward. I wouldn't be inclined to buy it at this point, since the risk is higher, but it's still intriguing to see the Fibs in action. The light green rectangles, by the way, are simply price gaps which I've highlighted.
http://photos1.blogger.com/blogger/4311/970/400/0314-GOOGFibs.jpg
at 3/14/2006 4 insightful comments
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