Good morning. Happy Wednesday.
The Asian/Pacific markets closed mixed; there were noticeable movers in both directions. Australia and Malaysia gained more than 1%. South Korea dropped 2.3% and Hong Kong dropped 3.4%. Europe is up across the board. Most of the indexes are up at least 1.5%, and about half are up 2% or more. Futures here in the States point towards a positive open for the cash market.
The market was near its lows yesterday afternoon when it suddenly went vertical the last 45 minutes of the day. News came out of Europe that in my opinion wasn’t that inspiring, but enough traders liked it to quickly push prices up, and once the ball got rolling, the momentum wasn’t going to stop until the closing bell.
Although such a move may or may not be what you’d like to see, you can’t be surprised. We are in a high risk environment. Four times in the last two months the S&P has rallied at least 75 points after having dropped by that amount or more. Numerous times we’ve gotten sudden reversals, often in the form of a gap. This is why I’ve been preaching to be ahead of the curve taking profits as opposed to using trailing stops because the reversals have come without warning. But using loose trailing stops is fine as long as you know these bounces will occur and you’re ok with them. Pick a trading style and stick with it. I do not under any circumstance suggest constantly changing your stripes. It’s much better to be consistent with your methods.
In my eyes the trend remains solidly down…100-point SPX rallies within the trend are commonplace and we know the biggest up days occur within downtrends. I see no reason to change my bias, but that doesn’t mean I’ll stay short if the S&P wants to rally to the top of its range. My preference is to exit and re-enter rather than hold and hope little damage is done to my account.
Maybe the market rallies to the top of its range; maybe yesterday’s announcement was misread and yesterday’s gains will be quickly given back. I’m in wait-and-see mode. More after the open.
headlines at Yahoo Finance
today’s upgrades/downgrades
this week’s Earnings
this week’s Economic Numbers
0 thoughts on “Before the Open (Oct 5)”
Leave a Reply
You must be logged in to post a comment.
Anytime they juice the markets it’s usually a precursor
to some bad news about to unfold. A 45 minute wonder
rally does not change the picture to all of a sudden
‘bullish’ in my opinion. So here we see the futures
flat to slightly down at the open. Watch for a retest
of 1105 to 1108 before we go long again. HW
Seems like a languid up day at the moment.
RichE: do you have any TA to confirm, or is it
just conjecture at this point? In view of the
fact Europe is rallying hard today we should
be up as well, don’t you think? HW
Nope. I trust the force.
Somebody with good TA analysis please check out those bollinger bands
on the 1min and 5min chart. It looks like we are getting ready to
break out one way or the other. (I think down, but then again who
knows? there’s a 50% chance of rain today, right?).
Sounds like a coin flip. Cool TA system you got going there.
Working off of all the other blogs I am following at the moment
it looks like the next piece of news will drive this market
out of it’s stalled position we are in. Are they secretly
burying the Greece news at the moment, while in fact they
are protesting in the streets of Athens as we speak? HW
I see that the downtrend line from SPX 1196 has been broken which I view as short term positive for a further advance. I’m watching the 1148 area as a potential upside target and, if broken, the 1165 area. Having noticed that the Fibonacci .618 retracement levels have been turning point areas in previous price swings, both up & down, has drawn my interest in 1148 & 1165 (particularly 1148). Below curent trading, I see Howard mentions 1105-1108 as a support area while I’m focused more on the 1103 area.
However, if we consolidate this morning around present levels and then move higher, I could see the potential for a retest of the 50 day ema presently around 1190. Therefore, I’m going to hold off on putting on my final 1/3 of a full position for now.
after long only finish their beg month buying from “” low “” prices the hedgies may continue
selling—todays close may be interesting
this feels like a hope rally so must be still a wave 2–pos a abc–but ew may be unreliable in these cercumstances
cant short untill see some selling and my tick ind is all buying
Several EMAs & FIBO resistance numbers cluster around SPX 1148-1165. I also have various trend lines suggesting resistance in the same areas more to the upper end of that range. EW analysis is leaving open the potential for a move even higher, perhaps to the 50 day EMA around 1190 but first we have to see 1148-1165 and how prices react if we get there.
In this day and age where 300+ swings in the Dow Jones
are the new norm +70 at the moment on light volume
is no big deal. But anyway, as long as the general
direction is up I have to give credit to RichE
and his gut telling him it’s a ‘languid up’ day.