Archive for October, 2009
Nervous Trading Will Test Support Next Week - I Expect It To Hold. I’m Lining Up Longs.
Volatility has returned and prices have been all over the board this week. Earnings have been very good and so have the economic numbers. Almost 80% of the companies are beating third-quarter estimates. Unfortunately, great results are priced in and many stocks are trading lower after a good number. We are through the meat of earnings season and the surprise element will diminish next week. Durable goods orders were right in line Wednesday and GDP posted a huge 3.5% gain yesterday. Goldman Sachs had lowered its estimate down to 2.7% on Wednesday and that generated selling pressure. When the actual number …
A Great GDP Number Is Barely Enough To Spark A Rally. Jobs Will Be An Issue Next Week!
This week, the market is showing some signs of strain. Four consecutive days of heavy profit-taking pushed the market down to the uptrend line that dates back three months. Earnings have been decent, but that is already priced into the market. After beating expectations, stocks have been trading lower after the release. This is an indication that the market is “fully valued”. The majority of companies have posted results and since we have heard from most groups, the surprise element is starting to wane. On the bullish side of the ledger, low interest rates, solid earnings growth and “less bad” economic …
The Market Will Continue To Probe For Support. As Long As The Trend Is Intact - Line Up Your Longs!
Yesterday, the market continued to slip and now we have four consecutive days of heavy selling. The breakout from two weeks ago has failed and we are approaching a very significant support level at SPY $104. That is the uptrend line that dates back three months. We are currently just above the 50-day moving average. In today’s chart, you can see that the recent trough a month ago was deeper than the previous dips. The recovery and subsequent breakout was also smaller in magnitude. Recently, sustained selling pressure has appeared for the first time since July. This price action suggests that …
CBOE ANNOUNCES THIRD-QUARTER 2009 FINANCIAL RESULTS; REVENUES, NET INCOME LOWER AGAINST RECORD THIRD-QUARTER 2008
CBOE ANNOUNCES THIRD-QUARTER 2009 FINANCIAL RESULTS; REVENUES, NET INCOME LOWER AGAINST RECORD THIRD-QUARTER 2008
Expect Nervous Trading Into Next Week. Line Up Strong Stocks For Put Credit Spreads!
Earnings continue to pour in and they have been positive. Over 80% of the companies that are reported have exceeded expectations. Yesterday, the market started off on a positive note. A stronger than expected GDP release in South Korea sparked buying in Asia. That spilled over into other markets. After a brief rally, our market reversed sharply and it closed lower for the day. In the chart below, you can see that we have fallen below the breakout from two weeks ago. The price action the last few days has been bearish. Overnight earnings were decent, but that was already priced …