Tuesday, September 13, 2011

5:30AM: Futures are down some what this morning, following the strong last 45 minutes of the day yesterday the futures followed that up with a continuation rally in the after hours, but the DOW sold off about 200 points during the over night session, we are currently on a little rally into the premarket open here in the states. The DOW chart, at the bottom, shows it falling into a kind of multiple support area on that five minute chart, after taking out the late rally yesterday. If we were to open the regular session here, or even rally to yesterdays close, which is the upper red horizontal line, I would "expect" us to come back down and test the over night lows. Of course, that thinking kind of screwed me up yesterday, as I, THOUGHT, we were going to "test" the over night lows after the open yesterday, which was about $113.50 in the SPY, but we never did it, the daily chart of the SPY, in the middle, show's we opened up right on last week's lows, about 10 cents above it actually, rallied right out of the gate, then pulled back the rest of the day into the late afternoon and actually took those lows out by about 25 cents, and then closed strong, with good volume, especially for a Monday. On that DOW chart you can see the premarket lows I was looking for, way over on the left side of the chart, at about 8 am ET yesterday. It was my own fault of course, as I was "anchored" on the premarket price, rather than focusing on the much more important "LARGER" time frame, which was the weekly low.
One very strange aspect of yesterday is the top chart, the NYSE A/D's closed NEGATIVE, very unusual stuff indeed, the A/D's have actually been leading the market higher, that could account for the weakness some what this morning. 
Europe is again taking the blame for the decline this morning, but at least today they have split markets, and at least they aren't down 4-5 % like they were yesterday, a five year note auction in Italy didn't go to well, Italy was the "cause" of the late rally yesterday as a rumor circulated that China was going to possibly lend them money, and you know how much the markets love it when a country that is running a 125% DEBT to GDP ratio borrows MORE money so they can make the interest payments on the PRIOR money they borrowed in order to pay for things they COULDN'T afford in the first place, hahahahahaha, the world has definitely lost it's collective minds!
Wad ever, when you look at that SPY chart in the middle, it's a, aaaahhhhhh, MESS, gaps all over the place, up and DOWN, with huge swings, great for day traders but a little tough on "Investors" trying to find a logical entry into this market, it's tough when you buy into a rally only to wake up the next morning and find out you are already DOWN 1-5%! For short term swing trader's this may not be to bad of an entry point, especially if we have a little weakness into the open this morning, at least you know where your STOP would be, under yesterday's low, if we get under that low we will undoubtedly test the low of the range, like $110, OR WORSE we could break down, but you may catch a rally back up to the TOP end of the range, around $123, so you would be looking for a $5 gain with a $1.20 stop, or better than a 4/1 Risk/Reward ratio, which is acceptable in my book.
Good luck to you out there in La La Land. 


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1 Comment:

sysin3 said...

Go get 'em, oh Clueless One.

I can't trade this shite.

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