Option Investor
Archive
HAVING TROUBLE PRINTING?
Printer friendly version
Jeff Bailey : 2/11/2009 4:37:24 PM

Closing U.S. Market Watch Link

Jane Fox : 2/11/2009 4:04:46 PM

Markets did a lot of meandering today. Link

Keene Little : 2/11/2009 4:04:01 PM

There's not a lot of change to the SPX 60-min cahrt as we finish the day. I see the possibility for an additional bounce tomorrow (843-846 target) or an immediate decline tomorrow. If price continues to consolidate into mid day tomorrow it will also be a setup for another leg down. SPX 60-min chart: Link

Jane Fox : 2/11/2009 4:03:56 PM

TRIN closes at 0.63 a fairly bullish number

Jeff Bailey : 2/11/2009 3:37:26 PM

Imperative it closes below for bears. WKLY Pivot continues to hold buyers.

Jeff Bailey : 2/11/2009 3:36:06 PM

PBR $29.04 +1.21% ... slips back below MONTHLY R1.

Jeff Bailey : 2/11/2009 3:33:34 PM

NVIDIA Tender Offer (details) ... dj- Nvidia Corp. (NVDA) is making a cash tender offer for employee stock options that could total about $92 million. The offer comes as the graphics-chip maker's stock has plummeted 68% in the past year amid woes in the semiconductor sector that were exacerbated by a weak Christmas selling season for consumer electronics. Shares were off 11% recently at $8.28, after Nvidia late Tuesday reported swinging to a fiscal fourth-quarter net loss on a sharp drop in sales and margins. The loss marked the second in the past three quarters, and it was far worse than Wall Street had been expecting. The tender offer is for options with an exercise price of at least $17.50 a share. As of Jan. 25, there were about 33 million eligible options. As a result of the offer, the company could incur a one-time charge of up to $150 million if all unvested eligible options are tendered. The charge would be recorded in the fiscal first quarter of 2010. The offer begins Wednesday and will expire at 3 a.m. EST March 12. Board members and some executives aren't eligible for the offer.

Jeff Bailey : 2/11/2009 3:32:27 PM

dj- NVIDIA makes cash tender offer for employee stock options

NVDA $8.02 -13.94% ...

Jeff Bailey : 2/11/2009 3:31:34 PM

dj- Bank CEOs agree to temporarily suspend foreclosures

Jeff Bailey : 2/11/2009 3:25:28 PM

dj- Fed's Evans: TALF expected to roll out in coming weeks

A Federal Reserve program to prop up consumer lending markets is expected to roll out "in the next few weeks," Chicago Federal Reserve President Charles Evans said Wednesday. Speaking to reporters at a luncheon hosted by the CFA Society of Iowa, Evans said the registration process for the Fed's Term Asset-Backed Lending Facility has been more challenging than originally thought. Nevertheless, Evans said Fed officials are looking for the TALF to have a "noticeable impact on the credit markets." The TALF, in the works for months, will enable holders of securities backed by student, consumer and small business loans to pledge such debt to borrow from the central bank. The program is one of many liquidity facilities being implemented by the Fed, which has seen its balance sheet swell to an approximate $2.3 trillion in the process. The Fed announced last week that it would extend key liquidity programs through the fall, as strains on the financial markets persist. The programs, which include funding facilities for financial institutions and swap lines with other central banks, originally were set to expire April 30.

Jeff Bailey : 2/11/2009 3:23:16 PM

$IIX.X 140.16 +0.04% ...

Jeff Bailey : 2/11/2009 3:23:01 PM

dj- Internet tax credit dropped from stimulus bill

Keene Little : 2/11/2009 3:22:53 PM

We're close to finishing a 5-wave advance off this afternoon's low and that sets up a reversal. I don't know yet if it will be a reversal that leads to a smash-down move tomorrow or just a pullback that will lead to another leg up tomorrow as part of a larger bounce. But its setting up the first opportunity to try a short and then we'll see what kind of pullback we get. The bounce off yesterday afternoon's low just achieved equality at 836.76.

Jeff Bailey : 2/11/2009 3:22:21 PM

NYX.X 137.01 +1.01% ...

Jeff Bailey : 2/11/2009 3:21:52 PM

dj- Stimulus includes $6 billion or broadband grants

Keene Little : 2/11/2009 3:13:09 PM

Because today's price pattern of the decline from this morning's bounce looks more corrective than impulsive it's possible it's a b-wave pullback within an a-b-c bounce off yesterday's low. This type of bounce, called an expanded flat correction, typically sees the c-wave achieve 162% of the a-wave. SPX 10-min chart: Link

That gives us an upside projection of 845.70 which is in between a 38% and 50% retracement of yesterday's decline (the bounce could be over before the end of the day). So we've got an upside resistance zone at 843-846. If we get a nice clean 5-wave move up from this afternoon's low, that will be the time to hit it short. Now all it has to do is get up there instead of continuing sideways.

Jeff Bailey : 2/11/2009 3:09:15 PM

NASDAQ a/d 1,430/1,222

Jeff Bailey : 2/11/2009 3:09:02 PM

NYSE a/d 1,754/1,202

Jane Fox : 2/11/2009 3:05:26 PM

WASHINGTON (MarketWatch) -- Negotiators from the House and Senate have reached a agreement on a $789 billion economic stimulus plan, Senate Majority Leader Harry Reid said Wednesday. The agreement has the support of three key Republican senators whose votes are essential to winning approval in the Senate. Sen. Susan Collins, R-Maine, said the plan will put Americans back to work in a fiscally responsible way by spending less than the House bill proposed and putting more people back to work than the Senate bill would have. The bill includes tax cuts, spending on infrastructure projects, and relief for those who've lost their jobs or homes.

Jane Fox : 2/11/2009 3:04:13 PM

House and Senate reach a deal on the Economic Stimulus Bill.

Keene Little : 2/11/2009 2:58:55 PM

So we know it was a successful test of yesterday's low and now I'm watching to see how SPX does with today's high (assuming it will get there). We're either stuck in a larger sideways consolidation pattern or we'll get the bigger bounce into tomorrow. Both will result in lower lows into next week but it's a matter of when the next leg will start down and from what level.

Jane Fox : 2/11/2009 2:57:11 PM

NEW YORK (MarketWatch) -- Economic stimulus and other government moves will eventually improve the ailing housing market, but more drastic steps are needed to stem rising home foreclosures, Federal Reserve Gov. Elizabeth Duke said Wednesday.

While weakness in the housing market is likely to persist for some time, modifying the terms of loans could prevent foreclosures for a segment of distressed households, with some steps already taken by private and public entities, according to Duke, speaking at a gathering of risk managers in New York

Jeff Bailey : 2/11/2009 2:55:03 PM

Decent buy program comes in.

Keene Little : 2/11/2009 2:27:52 PM

Actually the wave count for the move down from this morning's high would look better with one more consolidation and then new low. That would set up it up nicely for a low around SPX 817.

Jeff Bailey : 2/11/2009 2:24:52 PM

02:00 Internals at this Link

Keene Little : 2/11/2009 2:24:44 PM

The move down from this morning's bounce high is now a 5-wave move. It could easily extend lower but now the risk for shorts is that a larger 5-wave move down from Monday can be considered complete. Therefore we could get a reversal back up at any time now that the minimum objectives of the wave pattern have been met. The larger bounce into tomorrow (to set up another short play) remains a very good possibility from here. It takes a break below 815 to suggest more bearish things are happening.

Jane Fox : 2/11/2009 2:23:34 PM

Ya think maybe anyone embezzling money in China will now think twice about it?

Jane Fox : 2/11/2009 2:24:12 PM

HONG KONG (MarketWatch) -- A Chinese court has sentenced the former chairman of a state-owned holding company overseeing 30 airports, including Beijing International, to death for bribery and embezzlement amounting to more than 100 million yuan ($14.6 million), according to a report late Tuesday by the state-run Xinhua News Agency.

Jeff Bailey : 2/11/2009 2:21:57 PM

New lows at both the big board and NASDAQ approach yesterday's measures.

Jane Fox : 2/11/2009 2:21:45 PM

Consolidations at daily lows means there is a higher probability price will fall, which indeed it did. Link

Jane Fox : 2/11/2009 2:19:45 PM

Internals are not looking all that healthy here but look at the TRIN, it is not supporting the bearish AD volume and line. Mind you though the AD line is really only -584. Link

Jeff Bailey : 2/11/2009 2:09:19 PM

HUI.X 315.00 +7.08% ...

XNG.X 282.33 -2.82%

CHK $17.68 -1.72% ...

Keene Little : 2/11/2009 1:57:19 PM

SPX is back for a possible test of yesterday's low (as part of a larger upward correction). If 817-820 looks like it will hold as support we'll have bullish divergences on the 30 and 60-min charts suggesting a bigger bounce will be next so be careful chasing this lower. Pull your stops down behind you if short.

Jeff Bailey : 2/11/2009 1:56:37 PM

Swing trade call lower target alert! ... for the US Oil Fund USO April $31 Call (UBO-DE) to $31 in the underlying.

USO $26.07 -3.12% UBO-DE $1.15 x $1.25

Jeff Bailey : 2/11/2009 1:51:32 PM

CDE $0.7351 x $0.7392 ... sense, based on observation we could see some "bid pulling."

Jeff Bailey : 2/11/2009 1:50:35 PM

VIX.X 45.51 -2.48% ...

Jeff Bailey : 2/11/2009 1:50:12 PM

CHK $17.57 -2.39% ... edges back below 02/06/09 entry benchmark of CHK-OW $1.75 x $1.85

Jeff Bailey : 2/11/2009 1:48:44 PM

iShares Brazil (EWJ) $37.44 -1.05% ... Friday's close matched 01/06/09 close.

Jeff Bailey : 2/11/2009 1:47:39 PM

PBR $26.63 -0.17% ... testing 01/06/09 intra-day high.

Jeff Bailey : 2/11/2009 1:47:04 PM

FXY $109.98 -0.33% ...

YCS $21.38 +0.37% ...

Jeff Bailey : 2/11/2009 1:46:13 PM

Have closed out position in YCS today. Sense renewed defensive posture.

Jeff Bailey : 2/11/2009 1:33:18 PM

Disclosure: I currently hold bearish position in PBR.

Jeff Bailey : 2/11/2009 1:24:32 PM

PBR short .... stop goes $30.50. Target is $27.00.

Jeff Bailey : 2/11/2009 1:23:16 PM

Swing trade short alert! ... for 1/4 position, or 100 shares of Petroleo Brasiliero (PBR) at the bid of $29.04.

Jeff Bailey : 2/11/2009 1:12:58 PM

UUP $25.96 +0.46% ... session high and sticking its head above downward trend.

Jeff Bailey : 2/11/2009 1:12:21 PM

Swing trade long exit alert! for the entire Coure D' Alene Mines (CDE) at the bid of $0.74

Jane Fox : 2/11/2009 1:09:21 PM

Here are your overnight charts. Not much happening today is there? Link

Keene Little : 2/11/2009 12:59:58 PM

Updating the SPX 60-min chart shows a higher bounce today would fit better as the 2nd wave correction to the 1st wave down from Monday, with an upside target near 842-843: Link . That would set up a 3rd wave down into next week (dark red). But if we get a little lower low first (to about 817), shown with the light dashed line, then the larger bounce could follow into tomorrow before setting up the stronger decline. It's not clear yet which scenario could play out so I continue to watch for more clues.

Keene Little : 2/11/2009 12:48:23 PM

If ES continues to drop from here it will look good for the 5th wave down, as shown earlier on the 60-min chart showing all-hours price action and updated here: Link . Right now 815 (about SPX 817) is the downside projection based on equality with the 1st wave. That would then set up a larger bounce into tomorrow, perhaps back up to the 840 area.

But the cash index is not giving me the same picture. It supports the need for a higher bounce today to correct the decline from Monday's high. A continuation of the bounce/consolidation would better support the larger correction idea and this would be a setup for strong selling to follow (one that quickly takes SPX below 800).

If one or the other scenario starts to look more plausible I'll update the charts to reflect it.

Jeff Bailey : 2/11/2009 12:48:01 PM

HMO.X 1,092.29 +0.21% ...

UNH $28.18 +0.75% ...

Jeff Bailey : 2/11/2009 12:47:00 PM

dj- GM to cut health benefits for some medicare-eligible retirees

Keene Little : 2/11/2009 12:35:29 PM

For readers of the LEAPS Trader you know that I'm looking for an entry to buy a LEAP put on GDX, the gold miners ETF. I like that one because it has better option volume, particularly for LEAPS, than does XAU. But XAU has a longer history and it's interesting to look at its monthly chart, using the log price scale because of the big price change since 2000: Link

The broken uptrend line from 2000 was broken with the spike down in October (coinciding with the stock market selloff). It has now bounced back up to it and is just shy of a 50% retracement and its 50-month moving average, both located near 136. Can you say kiss goodbye setup?

The daily chart of XAU shows the bearish rising wedge pattern where a little throw-over finish could have it tagging its 200-dma at 136.75, coinciding very nicely with the levels shown on the monthly chart. This is why I like a longer-term short play on GDX (upside trigger on GDX is 37.40 and it's currently trading at 36.54.) XAU daily chart: Link

Jeff Bailey : 2/11/2009 12:27:03 PM

MBA's Weekly Application Survey Link

Jane Fox : 2/11/2009 12:21:02 PM

I am going to take the magenta trendline off the SPX chart because it has been rendered invalid with price movement since February 6th. Price broke through the line on the way then broke below it on the selloff yesterday. Link

Jeff Bailey : 2/11/2009 12:09:54 PM

dj- TOLL BROTHERS RESULTS SLUMP BUT JAN. SHOWS REBOUND

Luxury builder's home-building revenue falls 51% to $409.3 million, below estimates of $443 million, as closings decline 45% and signed contracts tumble 59%. But January gives hint of a rebound, possibly from Toll's 3.99% mortgage promotion.

TOL $18.58 (unch) ...

DJUSHB 213.01 +4.05% ...

Jeff Bailey : 2/11/2009 12:08:18 PM

dj- RESEARCH IN MOTION SLIDES AFTER REVENUE UPDATE

Blackberry maker says fiscal 4Q revenue will be in the middle of its forecast with margins and earnings at the low end of prior views, but it boosts its target on 4Q subscribership growth by 20%, citing record activations in December and saying 'strong' growth continues after the holidays.

RIMM $47.59 -16.56% ...

Jeff Bailey : 2/11/2009 12:07:04 PM

dj- US TRADE GAP NARROWS TO $39.93B

U.S. deficit in international trade of goods and services decreases by 4.0% to $39.93 billion from November's revised $41.58 billion, its smallest gap in nearly six years as oil prices kept plunging amid a weak global economy and Americans cut purchases of imported goods.

Jeff Bailey : 2/11/2009 12:05:34 PM

YM 5-minute chart Link

Jeff Bailey : 2/11/2009 11:51:06 AM

YM 7,922 ... has been capped by WKLY S1 (RSD).

Keene Little : 2/11/2009 11:44:50 AM

If SPX breaks below 831.15, the low near 11:15 AM, it would be a heads up that we're either going to stay stuck in a sideways consolidation today or that the bounce has already finished and we'll head for a new low.

Jeff Bailey : 2/11/2009 11:44:44 AM

Cell Therapeutics (CTIC) alert! ... Halted for trade (H.11 = Halt - Regulatory Concern Trading is halted in conjunction with another exchange or market for regulatory reasons.)

Jeff Bailey : 2/11/2009 11:40:32 AM

VIX.X traders very alert today as DAILY Pivot and MONTHLY Pivot correlative. Note YESTERDAY's VIX.X high.

Jeff Bailey : 2/11/2009 11:38:08 AM

SPX ... analysis: first sign of RENEWED strength would be something ABOVE the WKLY Pivot.

Jeff Bailey : 2/11/2009 11:37:28 AM

FXY $110.04

SPX 837.34

Jeff Bailey : 2/11/2009 11:36:51 AM

Mr. Utley's "safety" perception of the yen is no different that some of what we've heard, yet I've had a difficult time seeing the yen as being any safer than another currency.

However, after talking through things with Mr. Utley, his fundamental arguments are starting to sway me, and as every good trader/investor knows, history is an EXCELLENT guide.

The current financial/banking crisis here in the U.S. is very similar to that in Japan some 15-years ago.

The MAJOR DIFFERENCE right now that Mr. Utley argues as the "yen safety" trade is their SAVINGS RATE vs. U.S.

That is, Mr. Utley agrees that Japan is probably in no better position than the U.S., but see their SAVINGS RATE as the primary reason the yen gets the push toward a "safety currency."

Jeff Bailey : 2/11/2009 11:30:18 AM

Last night is was talking on the phone with Eric Utley about these markets and our conversation turned from snow geese in South Dakota to the Yen and U.S. equities.

Mr. Utley agreed that the yen's trade has certainly been a "read" on flight to safety vs. weakness in U.S equity markets and at times has been a "tell" on market direction as a leading indicator. Mr. Utley pointed to Monday's slight up-tick in the yen from the FXY 108 level on Monday, with Tuesday's gains simply further near-term "flight" on U.S. equity weakness.

I questioned my good friend and fellow trader about the 11/20-01/06 periods of U.S. equity markets and the yen, and he surmised that there has never been a DIRECT mirror of yen/U.S. equity, but a RELATIVE move within ranges.

Then we immediately began discussion ragarding the Pivots, which do put things within their RELATIVE ranges.

Jeff Bailey : 2/11/2009 11:23:05 AM

FXY and SPX Daily Intervals with RSD MONTHLY/QUARTERLY Pivot retracement Link

Keene Little : 2/11/2009 11:20:08 AM

I'm trying to keep track to two different wave count ideas between SPX and ES and right now I'm looking at the possibility for SPX to bounce up to and fail at 841-842 (two equal legs up from yesterday's low and 38% retracement) and ES to fail near 837. Whether we then make a strong move down or just a relatively minor new low near SPX 818/ES 815 is the question for now. But regardless, it's looking like we should get another leg down after the current bounce finishes.

Jeff Bailey : 2/11/2009 11:00:52 AM

FXY $110.12

SPX 833.27

Keene Little : 2/11/2009 10:56:04 AM

As a reminder, this is the updated daily chart of gold (GC, continuous contract so April is the current front month) and it shows it reaching the Fib projection at 943.90 and the top of its channel: Link . It can certainly continue higher, and that's the risk in trying to play the reversal but this is the setup to try it. Confirmation of a top doesn't come until gold drops below 892.

Jeff Bailey : 2/11/2009 10:54:20 AM

FXY $110.23 -0.10% ... closed above MONTHLY Pivot yesterday (110.12) and edges back here this morning.

SPX 833.60 +0.77% ...

Jeff Bailey : 2/11/2009 10:46:30 AM

Current OPEN MM Profiles that I've made at this Link

Keene Little : 2/11/2009 10:38:38 AM

Techs were leading to the upside and it appears today they're going to lead us to the downside. Because NDX made a minor new high yesterday morning I can't give it the same wave count as the others and therefore I have less of a feel (other than very bearish) for this one at the moment. The only warning I have is that if the very bearish wave count for NDX is correct then forget about any near-term support for the others as well. It could be a tricky day so be careful on both sides for the time being (don't let a move go against you).

Jeff Bailey : 2/11/2009 10:31:01 AM

HUI.X 312.66 +6.29% ... sector winner

Keene Little : 2/11/2009 10:29:59 AM

At the same time silver is doing a little throw-over above its 200-dma at 13.47 (high so far is 13.61). I like silver as a better short because it has more of an industrial component and we know industry is slowing down.

Jeff Bailey : 2/11/2009 10:29:46 AM

Research in Motion (RIMM) $47.17 -17.30% ... getting hit hard.

Keene Little : 2/11/2009 10:28:21 AM

Gold is up strong today and has now reached the upper trend line along the highs since December (top of a potential rising wedge pattern), near 945. A slight throw-over above it could have it tagging 950 or slightly higher. But this is the setup for a reversal so watch it closely if you're interested in a short play.

Jeff Bailey : 2/11/2009 10:25:57 AM

10:00 Internals at this Link

Jane Fox : 2/11/2009 10:12:48 AM

NDX cash is the first to break to a new daily low

Keene Little : 2/11/2009 10:10:17 AM

If the current bounce is followed by a relatively minor new low, as depicted on the ES chart, SPX could find support just below the uptrend line from November, currently near 820. From there we should look for about a 50% retracement of the decline, which would give us an upside target near 846 and by the end of day tomorrow.

Jane Fox : 2/11/2009 10:09:40 AM

Sooner or later ES (S&P futures) will make a new daily low.

Jane Fox : 2/11/2009 10:02:03 AM

Both ES and YM peeked above their overnight highs but were not able to stay there. Link

Jane Fox : 2/11/2009 9:58:05 AM

The VIX is telling us the bulls have not even gotten out of bed this morning. Link

Jane Fox : 2/11/2009 9:46:00 AM

BOSTON (MarketWatch) -- Toll Brothers Inc. on Wednesday estimated its fiscal first-quarter home-building revenue was cut in half by the ongoing housing downturn as the company rolled out 4% fixed-rate mortgages to attract nervous buyers.

The Horsham, Pa.-based company (TOL) said building revenue dropped 51% from the year-earlier period to $409.3 million, while net signed contracts fell 59% on a unit basis.

The results were preliminary and Toll is scheduled to report full quarterly earnings on March 4. The luxury-home builder said it expects to record pretax write-downs between $100 million and $200 million in the fiscal first quarter.

"The past five months have been among the most difficult in U.S. economic history," said Robert Toll, chief executive, in a prepared statement. "Many potential buyers are now concerned about their job security and the economy's financial stability, in addition to their ability to sell their current homes."

Keene Little : 2/11/2009 9:40:34 AM

ES has a slightly different pattern than SPX and I get the impression from its wave count that we could see a little higher for its bounce and then a new low today before getting the larger correction of the decline. A downside Fib projection near 815 lines up with the uptrend line from January 23rd. ES 60-min chart: Link

Jane Fox : 2/11/2009 9:36:04 AM

WASHINGTON (MarketWatch) -- U.S. gross domestic product likely fell at a 5% annual pace in the fourth quarter of 2008, not the 3.8% annual decline reported two weeks ago, economists said Wednesday after the government reported the December trade figures. The report showed exports falling rapidly, which means exports won't provide the boost to growth originally assumed. John Ryding of RDQ Economics and David Rosenberg of Bank of America/Merrill Lynch said GDP is now on track to be revised to minus 5%, while Stephen Stanley of RBS Greenwich Capital looks for a revision to minus 5.3%. David Greenlaw of Morgan Stanley said the report shows first-quarter growth is likely contracting at a 5.5% annual pace.

Jane Fox : 2/11/2009 9:35:23 AM

AD Line is a bearish -1348.

Keene Little : 2/11/2009 9:28:07 AM

It was relatively quiet last night and the possibility for a bounce this morning still looks good. It could be choppy and whippy (like last night's price action) so trade carefully this morning.

Jane Fox : 2/11/2009 9:24:24 AM

Here is an example of a sideways consolidation that broke to the downside, crude. This market continues to fall yet each new low is met with a higher MACD low. Price is king and it doesn?t matter what the MACD is telling you so until price shows a little bit of bullishness I am staying away from this market. Link

Jane Fox : 2/11/2009 9:14:18 AM

HONG KONG (MarketWatch) -- Mitsubishi UFJ Financial Group and Morgan Stanley have agreed to merge their Japanese securities businesses, forming what will become the nation's third largest brokerage, according to a Wednesday report in the Nikkei newspaper. The deal will see MUFG convert the $9 billion in preferred shares it purchased in Morgan Stanley (MS) last year into common stock. The Japanese bank will eventually hold about 20% of Morgan Stanley's outstanding shares, the report said.

Jane Fox : 2/11/2009 9:11:52 AM

DOW futures are up +27
S&P futures are up +2.25
Russell 2000 futures are up +2.60
NDX futures are down -2.75

Jane Fox : 2/11/2009 9:10:06 AM

The overnight session was just a sideways movement from the previous day's close. This doesn't instill a great deal of confidence in the bulls because this kind of consolidation suggests there is a higher probability support will break before resistance. Link

Jane Fox : 2/11/2009 9:07:22 AM

WASHINGTON (MarketWatch) -- The nation's trade balance fell to a six-year low in December as the global market for U.S.-made goods shrank at a record pace while Americans decreased their appetite for imports, the Commerce Department reported Wednesday.

The trade gap -- the difference between imports and exports of goods and services -- narrowed to a seasonally adjusted $39.9 billion in December, the lowest in nearly six years, from a revised $41.6 billion in November. A year earlier, the trade deficit was $57.6 billion.

The data reflect weaker global trade flows that have been exaggerated by falling prices. Economists surveyed by MarketWatch had been looking for a much bigger improvement in the deficit, however, to around $35 billion.

Keene Little : 2/10/2009 11:59:55 PM

Wednesday's pivot table: Link

Into Tuesday afternoon I showed a 5-min chart with the suggestion that we could see a descending wedge form as the new lows in SPX started to show some bullish divergences. The price pattern started to look like an ending pattern. And then just before the end of the day SPX made a bounce out of the wedge so it looks like we could get a bounce first thing Wednesday morning. SPX 10-min chart: Link

Assuming we'll get the bounce similar to what I've depicted it will be a very good setup for the next shorting opportunity as the next leg down should be very strong (3rd wave). We'll have to see what sets up. The 60-min chart shows how SPX needs to get below 820 to break a few layers of support: Link

OI Technical Staff : 2/10/2009 9:59:59 PM

The Market Monitor has been archived. You may view it and any previous days here: Link

Disclaimer: Stocks discussed in the Market Monitor are for educational purposes only and any analysis is not meant to imply a recommendation for or against that stock. The analysts in this forum as on any other website are prohibited by the SEC from giving any specific advice to ANY individual trader. All information posted is for ALL readers and is not meant to be directed to any individual. Our analysts cannot answer any email questions regarding any specific stock. Please do not ask and please do not take offense if requests are denied.

Results posted in the Market Monitor are hypothetical and OIN does not claim that any reader achieved these exact results. Due to the lag time between research, writing, posting, uploading, reading and execution there will be differences between the actual signal given and the fill achieved by the reader. Fills may be better or worse but in most cases they will be different. The writers will make every effort to give advance notice of intended signals and indicate potential price targets. Your individual results may vary depending on your activity level and aggressiveness. This forum is intended as an education service only. Trading involves risk and should not be attempted by anyone not ready to accept this risk. By acting on any signal in this forum you agree and personally accept this risk.

Market Monitor Archives