Before the Open (May 18)

Posted on by Jason Leavitt

Good morning. Happy Friday.
The Asian/Pacific markets closed mostly down. Japan and South Korea dropped 3% or more, Taiwan and Australia more than 2%, China, Hong Kong, Indonesia and Singapore more than 1%. Europe is currently mixed. Greece is up almost 3%, Norway and Stockholm down around 2%. Futures here in the States point towards a moderate gap up open for the cash market.

The dollar is flat. Oil is flat, copper is up. Gold and silver are up.
Facebook (FB) starts trading today on the Nas. It’s a great American success story that shows upward mobility still exits. Anyone who is smart, works hard and is lucky can make it big in the USA. I’m not buying the stock…mostly because I’m a technical trader who needs at least a couple months of data to make trading/investing decisions. But I think it’ll do just fine. Even if it is overvalued, purely from a supply/demand standpoint, there aren’t that many social media companies to choose from. It has a massive user base. Even if it hasn’t monitized its base as well as it could have, it’s got such a big foot print, that if it figures out revenue stream #2, the stock can take off.
Moving on, I felt some panic in the air yesterday. It’s the first time this month I sensed the bulls throwing in the towel. I could feel the frustration. I could feel the disbelief. Those who held looking for one last bounce to exit positions are flat out furious. But now that some panic has begun, we’re likely close to a tradable bottom. Many breadth indicators I follow are at very low levels – levels that produced bottoms in the past.
Here’s an example of one of those indicators…the 10-day MA of the NYSE AD line. This is the second lowest level since the August meltdown. If you’re short, great. Manage your positions wisely. If you’re not short, in most cases it’s too late. You have no choice but to wait.

The bulls are dead, but soon the sellers will run out of ammo, and we’ll get a bounce. Have a plan, be ready.
headlines at Yahoo Finance
headlines at MarketWatch
today’s upgrades/downgrades
this week’s Earnings
this week’s Economic Numbers

0 thoughts on “Before the Open (May 18)”

  1. I need you guys to keep the SPY above 131 all day.
    I know you guys have deep wallets and can do this.
    If you don’t then I’ll have to roll my SPY puts into June.

    1. WoW! That is amazing you got filled at the low of the day (thus far). I don’t think I’ve ever nailed the low of the day; however, I don’t trade as much as you do.
      Congrats you already in profit!

      1. I sold half what I bought yesterday first thing this morning at 7.63 which was real close to the top, but I’m pissed I didn’t sell it all. could of swore we were going higher

  3. believe me I miss alot of oppertunities waiting for those last 3 cents. sometimes that 60 sec pause is not the bottom. I cuss outload at those ws bastards often

  4. bastards acting like order executions not getting reported is something new. everytime it happens to me I make them give me 20 free trades

  8. I know exactly how Patton felt on the battle field when he said “Rommel, you bastard, I read your book”
    or better Julius Caesar at the war of Pontus “Veni, Vidi, Vici” “I came, I observed, I conquered”

  9. little peter, I know you and the other wino are lurking and admiring me from the shadows. you can come back, but only if you start referring to me as Caesaruss, the market wizard

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