Dow & S&P 500 market analysis
The indexes ended as a doji last night. I will be looking for a bearish candle today to confirm the downtrend. After rallying so much in April, I’m expecting May to end flat with support at 800 and resistance at 900. Today, I’m expecting a down day with support at 850.
Direction for 05/01/2009 Friday: Down
Crude Oil (USO)
There is a price divergences between crude and USO. Something’s got to give. However I believe USO should be going to test previous low at 23 before any reliable long term rally up.
Direction for 05/01/2009 Friday: Down
Thursday, April 30, 2009
Tuesday, April 28, 2009
Dow & S&P 500 market analysis for 04/28/2009 Tuesday
Dow & S&P 500 market analysis
Asia and Europe are down due to worries about the Swine flu pandemic. US market futures are dropping like a fly overnight too. However it’s at daily pivot support now and may snap back up for a smaller gap down at market open. With the worries about the economic still not over and now the pandemic and the approaching “sell in May and go away” effect, we might be going down for a while.
Direction for 04/28/2009 Tuesday: Gap down and down
Crude Oil (USO)
Fears about the pandemic have caused all airline stocks to tank, and together with it, crude oil prices. Crude is still holding strong above support at 48, but if it tanks, we might see crude going down to test previous low at 33.50. That would be around 23 for USO.
Direction for 04/28/2009 Tuesday: Down
Asia and Europe are down due to worries about the Swine flu pandemic. US market futures are dropping like a fly overnight too. However it’s at daily pivot support now and may snap back up for a smaller gap down at market open. With the worries about the economic still not over and now the pandemic and the approaching “sell in May and go away” effect, we might be going down for a while.
Direction for 04/28/2009 Tuesday: Gap down and down
Crude Oil (USO)
Fears about the pandemic have caused all airline stocks to tank, and together with it, crude oil prices. Crude is still holding strong above support at 48, but if it tanks, we might see crude going down to test previous low at 33.50. That would be around 23 for USO.
Direction for 04/28/2009 Tuesday: Down
Monday, April 27, 2009
Forget the Recession. Panic About This Plane!
Something light to brighten the down day. =)
Forget the Recession. Panic About This Plane!
Posted By:Cindy Perman
Topics:Swine Flu | Terrorism | YouTube | New York City | Recession | Economy (U.S.)
Companies:Google Inc | Boeing Co
As if the recession, bank stress tests and swine flu weren't enough to worry about on a Monday morning, an Air Force "photo op" gave New Yorkers another reason to panic.
A plane flying low over New York. That shouldn't be any cause for concern, right?
--------------------------------------------------------------------------------
Just after 10 am, a Boeing [BA 39.63 0.91 (+2.35%) ] 747 plane that is the backup for Air Force One flew low over the Hudson River in New York City. It was accompanied by two F-16 fighter jets and circled three times, instantly evoking flashbacks of the Sept. 11, 2001 attacks.
A woman taped the event from her apartment window in Tribeca, just north of where the World Trade Center towers once stood, and uploaded the video to YouTube. [GOOG 385.28 -4.21 (-1.08%) ]
"Oh my god. That's not normal," she is heard saying on the video, as you see the plane flying close to the buildings. "It's a hijacking. I know it because it's going around," she says, in a panicky voice.
But it wasn't — the stunt was explained to be an Air Force "photo op," though workers at One Liberty Plaza were told it was an advertisement for a movie, the New York Times reported.
A spokesman for the FAA swears that this "photo op" was approved with all the necessary channels: The NYPD, The New Jersey PD, 911, 311 ...
Of course, the only people they forgot to run it by were New Yorkers, who remember Sept. 11 all too well.
CNBC reports Goldman Sachs headquarters were evacuated and traders felt windows rattle. Watch the video at left.
Hundreds of New Yorkers in lower Manhattan came rushing out of their office buildings, flooding the streets in panic that it was another terrorist attack.
Finally, someone showed up with a megaphone to tell them all it wasn't an attack and it was safe to go back to work.
The NYPD responded by saying they weren't allowed to alert the public. (Though they didn't say by whom.)
The good news is, we managed to forget about the recession and potential global swine-flu epidemic for about 30 minutes.
Tip of the hat to the Greatest City in the World for that.
The bad news is, we've all turned into Homer Simpson.
Ack! What was that?
Forget the Recession. Panic About This Plane!
Posted By:Cindy Perman
Topics:Swine Flu | Terrorism | YouTube | New York City | Recession | Economy (U.S.)
Companies:Google Inc | Boeing Co
As if the recession, bank stress tests and swine flu weren't enough to worry about on a Monday morning, an Air Force "photo op" gave New Yorkers another reason to panic.
A plane flying low over New York. That shouldn't be any cause for concern, right?
--------------------------------------------------------------------------------
Just after 10 am, a Boeing [BA 39.63 0.91 (+2.35%) ] 747 plane that is the backup for Air Force One flew low over the Hudson River in New York City. It was accompanied by two F-16 fighter jets and circled three times, instantly evoking flashbacks of the Sept. 11, 2001 attacks.
A woman taped the event from her apartment window in Tribeca, just north of where the World Trade Center towers once stood, and uploaded the video to YouTube. [GOOG 385.28 -4.21 (-1.08%) ]
"Oh my god. That's not normal," she is heard saying on the video, as you see the plane flying close to the buildings. "It's a hijacking. I know it because it's going around," she says, in a panicky voice.
But it wasn't — the stunt was explained to be an Air Force "photo op," though workers at One Liberty Plaza were told it was an advertisement for a movie, the New York Times reported.
A spokesman for the FAA swears that this "photo op" was approved with all the necessary channels: The NYPD, The New Jersey PD, 911, 311 ...
Of course, the only people they forgot to run it by were New Yorkers, who remember Sept. 11 all too well.
CNBC reports Goldman Sachs headquarters were evacuated and traders felt windows rattle. Watch the video at left.
Hundreds of New Yorkers in lower Manhattan came rushing out of their office buildings, flooding the streets in panic that it was another terrorist attack.
Finally, someone showed up with a megaphone to tell them all it wasn't an attack and it was safe to go back to work.
The NYPD responded by saying they weren't allowed to alert the public. (Though they didn't say by whom.)
The good news is, we managed to forget about the recession and potential global swine-flu epidemic for about 30 minutes.
Tip of the hat to the Greatest City in the World for that.
The bad news is, we've all turned into Homer Simpson.
Ack! What was that?
Dow & S&P 500 market analysis for 04/27/2009 Monday
Dow & S&P 500 market analysis
The market had been very volatile for the past week. Making huge drops and huge rallies in record speed though it had not been really going anywhere. (The week ended slightly down) I believe the rally had ended on last Monday and the last week was just the market resisting the change in trend. The news reports were mostly disguised as good news when it was actually bad.
Some examples below:
American Express Profit Falls But Blows Past Forecasts
“American Express reported earnings that declined from last year as the company struggled with higher bad loans, but the results easily oustripped analysts' estimates, sending its stock higher in late trading Thursday.”
http://www.cnbc.com/id/30364098
Sharp suffers loss, sees profit ahead
“Earlier this month, Sharp downwardly revised its forecasts of financial results, saying it expected a net loss of 130 billion yen for the year, bigger than the loss of 100 billion yen it had initially forecast in early February.”
http://www.marketwatch.com/news/story/Sharp-suffers-annual-loss-sees/story.aspx?guid=%7BF6EF2A49%2DE200%2D4926%2DBFD9%2DBE4DAF19ADA5%7D
These 2 companies had been lowering their loss forecast (I won’t even say profit forecast) repeatedly and yet when their losses were announced, their stock either fell a minuscule amount or in American Express’s example, it even rallied. Fancy a stock rallying when they had just announced a loss.
Anyway back to the situation of the markets now. With bad news such as the Swine outbreak in the US, I believe the news reports would not be able to hold the markets up for long.
Direction for 04/27/2009 Monday: Gap down and down
Crude Oil (USO)
Crude and USO should be going through a period of weakness due to the Swine outbreak. There is a support at 48 for /CL and 24 for USO.
Direction for 04/27/2009 Monday: Down
The market had been very volatile for the past week. Making huge drops and huge rallies in record speed though it had not been really going anywhere. (The week ended slightly down) I believe the rally had ended on last Monday and the last week was just the market resisting the change in trend. The news reports were mostly disguised as good news when it was actually bad.
Some examples below:
American Express Profit Falls But Blows Past Forecasts
“American Express reported earnings that declined from last year as the company struggled with higher bad loans, but the results easily oustripped analysts' estimates, sending its stock higher in late trading Thursday.”
http://www.cnbc.com/id/30364098
Sharp suffers loss, sees profit ahead
“Earlier this month, Sharp downwardly revised its forecasts of financial results, saying it expected a net loss of 130 billion yen for the year, bigger than the loss of 100 billion yen it had initially forecast in early February.”
http://www.marketwatch.com/news/story/Sharp-suffers-annual-loss-sees/story.aspx?guid=%7BF6EF2A49%2DE200%2D4926%2DBFD9%2DBE4DAF19ADA5%7D
These 2 companies had been lowering their loss forecast (I won’t even say profit forecast) repeatedly and yet when their losses were announced, their stock either fell a minuscule amount or in American Express’s example, it even rallied. Fancy a stock rallying when they had just announced a loss.
Anyway back to the situation of the markets now. With bad news such as the Swine outbreak in the US, I believe the news reports would not be able to hold the markets up for long.
Direction for 04/27/2009 Monday: Gap down and down
Crude Oil (USO)
Crude and USO should be going through a period of weakness due to the Swine outbreak. There is a support at 48 for /CL and 24 for USO.
Direction for 04/27/2009 Monday: Down
Saturday, April 25, 2009
Recovery expected only after mid-2010
Recovery expected only after mid-2010
Experts say housing market will rebound after stock market does.
By Joyce Teo
Published: April 23 2009,
The Straits Times
.......................................................
BUYERS snapping up homes in recent weeks may be jumping into the market way before it has reached the bottom, according to new research.
Real estate consultancy DTZ is tipping a gradual property market recovery only from the middle of next year. The firm bases its view on a new report from its Asia forecasting unit.
This shows how a slump, or recovery, in the stock market is always mirrored in the property market, but only after one or more quarters.
Or to put it more bluntly: The housing market will not recover until at least one quarter, or even a year, after the stock market recovers.
And as any stock market investor knows, the Straits Times Index (STI) is well down from its 2007 peak, even though it has risen slightly recently.
'The STI reflects people's view of the economy so its recovery will really depend on clear signs of an economic recovery,' said DTZ's senior director of consulting and research Chua Chor Hoon.
Experts have long noted that a recovery in the stock market typically precedes an economic recovery, with a recovery in the property market after that.
'It's all co-related in one way or another. The stock market is usually the earliest indicator but it's not hard and fast... its timing might be off,' said Daiwa Institute of Research analyst David Lum.
Last week, the Government said it expects gross domestic product to contract by 6 per cent to 9 per cent this year, well up on an earlier forecast of a 2 per cent to 5 per cent contraction. DTZ's study also underlined the high levels of unsold stock held by developers - another drag on prices and an eventual recovery.
The report indicated that the residential market thus has a higher chance of bottoming out only by mid-2010 and then staging a gradual recovery.
Mr Lum said the property market has already started to correct so anyone who bought recently would not have purchased at the peak.
If prices fall further, these people will not be happy, but they would have been comfortable with the price levels they bought into and will not be overstretched as they would have thought about their purchase, he added.
DMG & Partners Securities investment analyst Brandon Lee believes the mass market segment would have bottomed out at around $550 psf to $600 psf so recent buyers may not have much to worry.
Those who bought prime homes, however, may have gone in too early. Mr Lee sees the property market bottoming out only in the first half of next year.
'Crises in the past have lasted for six to eight consecutive quarters and we are only half way through,' he said.
'Further, equity markets are still volatile and prices have not reached the bottom for prime properties. Interest in prime property remains very subdued.'
The property market remains largely weak, even though recent sales of new private homes brought a glimmer of hope to the market. First-quarter new private home sales hit 2,660 units, representing 62 per cent of all new private homes sold during the whole of last year.
Whether it was pent-up demand, discounted levels or other factors, sales did reach very high levels given the recession.
But most sales were in the mass market segment, which consultants tip to be the best-performing sector this year.
Demand for prime and high-end homes remains sluggish.
'Since when does a 'rebound' in one segment signal a recovery for the entire market?' asked Chesterton Suntec International head of research and consultancy Colin Tan.
'The greatest danger we face now is complacency...If it were an ordinary recession, I can understand why we are starting to call this period of optimism the first signs of a recovery, but it is not,' said Mr Tan.
'The recovery cycle will be like no other. There will be further twists and turns.'
Experts say housing market will rebound after stock market does.
By Joyce Teo
Published: April 23 2009,
The Straits Times
.......................................................
BUYERS snapping up homes in recent weeks may be jumping into the market way before it has reached the bottom, according to new research.
Real estate consultancy DTZ is tipping a gradual property market recovery only from the middle of next year. The firm bases its view on a new report from its Asia forecasting unit.
This shows how a slump, or recovery, in the stock market is always mirrored in the property market, but only after one or more quarters.
Or to put it more bluntly: The housing market will not recover until at least one quarter, or even a year, after the stock market recovers.
And as any stock market investor knows, the Straits Times Index (STI) is well down from its 2007 peak, even though it has risen slightly recently.
'The STI reflects people's view of the economy so its recovery will really depend on clear signs of an economic recovery,' said DTZ's senior director of consulting and research Chua Chor Hoon.
Experts have long noted that a recovery in the stock market typically precedes an economic recovery, with a recovery in the property market after that.
'It's all co-related in one way or another. The stock market is usually the earliest indicator but it's not hard and fast... its timing might be off,' said Daiwa Institute of Research analyst David Lum.
Last week, the Government said it expects gross domestic product to contract by 6 per cent to 9 per cent this year, well up on an earlier forecast of a 2 per cent to 5 per cent contraction. DTZ's study also underlined the high levels of unsold stock held by developers - another drag on prices and an eventual recovery.
The report indicated that the residential market thus has a higher chance of bottoming out only by mid-2010 and then staging a gradual recovery.
Mr Lum said the property market has already started to correct so anyone who bought recently would not have purchased at the peak.
If prices fall further, these people will not be happy, but they would have been comfortable with the price levels they bought into and will not be overstretched as they would have thought about their purchase, he added.
DMG & Partners Securities investment analyst Brandon Lee believes the mass market segment would have bottomed out at around $550 psf to $600 psf so recent buyers may not have much to worry.
Those who bought prime homes, however, may have gone in too early. Mr Lee sees the property market bottoming out only in the first half of next year.
'Crises in the past have lasted for six to eight consecutive quarters and we are only half way through,' he said.
'Further, equity markets are still volatile and prices have not reached the bottom for prime properties. Interest in prime property remains very subdued.'
The property market remains largely weak, even though recent sales of new private homes brought a glimmer of hope to the market. First-quarter new private home sales hit 2,660 units, representing 62 per cent of all new private homes sold during the whole of last year.
Whether it was pent-up demand, discounted levels or other factors, sales did reach very high levels given the recession.
But most sales were in the mass market segment, which consultants tip to be the best-performing sector this year.
Demand for prime and high-end homes remains sluggish.
'Since when does a 'rebound' in one segment signal a recovery for the entire market?' asked Chesterton Suntec International head of research and consultancy Colin Tan.
'The greatest danger we face now is complacency...If it were an ordinary recession, I can understand why we are starting to call this period of optimism the first signs of a recovery, but it is not,' said Mr Tan.
'The recovery cycle will be like no other. There will be further twists and turns.'
Thursday, April 23, 2009
Dow & S&P 500 market analysis for 04/23/2009 Thursday
Dow & S&P 500 market analysis
The Dow and the S&P did an ice hole failure on hourly charts at the last hour last night. As you can see from the hourly charts, the S&P 500 failed to break above the 50 SMA in the last hour of trading yesterday.
This failure indicates that the rally had failed and the indexes may take out the lows made at market close 3 days ago. We are currently in a downtrend starting on the bearish engulfing daily candlestick formation made on Monday at I think may take us all the way to 800 on the S&P and 7,500 on the Dow.
Direction for 04/23/2009 Thursday: Down
Crude Oil (USO)
Crude and USO are showing divergence as USO had tanked below its 50 day moving average while crude is still moving more or less sideways and holding above the 50 day MA. Their respective behaviors are indicating that crude seems to be following USO although logically, it should be the other way around. However I believe both crude and USO will be going thru a period of weakness now before there can be any sustainable movement up. I am currently waiting to buy into the dips as I believe crude is currently the only one thing in the world that is still worth investing for the long term.
Direction for 04/23/2009 Thursday: Down
The Dow and the S&P did an ice hole failure on hourly charts at the last hour last night. As you can see from the hourly charts, the S&P 500 failed to break above the 50 SMA in the last hour of trading yesterday.
This failure indicates that the rally had failed and the indexes may take out the lows made at market close 3 days ago. We are currently in a downtrend starting on the bearish engulfing daily candlestick formation made on Monday at I think may take us all the way to 800 on the S&P and 7,500 on the Dow.
Direction for 04/23/2009 Thursday: Down
Crude Oil (USO)
Crude and USO are showing divergence as USO had tanked below its 50 day moving average while crude is still moving more or less sideways and holding above the 50 day MA. Their respective behaviors are indicating that crude seems to be following USO although logically, it should be the other way around. However I believe both crude and USO will be going thru a period of weakness now before there can be any sustainable movement up. I am currently waiting to buy into the dips as I believe crude is currently the only one thing in the world that is still worth investing for the long term.
Direction for 04/23/2009 Thursday: Down
History Says Pullback From Stock Market Rally a Solid Bet
History Says Pullback From Stock Market Rally a Solid Bet
By: Albert Bozzo, Senior Features Editor | 21 Apr 2009 | 09:39 AM ET Text Size
That's what some market watchers are saying about Monday's sharp selloff, following a stunning-yet, some say, suspect-run-up of well over 20 percent from the standing bear market low of March 9.
"Whenever you get that kind of move in that short a period when news is still mixed, you're vulnerable to a setback," says money manager Jim Awad, managing director at Zephyr Management. "We've gone from the bear market to the never-never land."Caution and skepticism has been building in some quarters recently, particularly as the Dow Industrials hugged a 200-point trading range over the 11 sessions going into Monday.
To some, however, the writing was already on the wall late last week, even as the major indices edged to new highs Friday in their spring sprint. "This thing is due," veteran market watcher and UBS floor operations director Art Cashin told CNBC early Friday. "I'm betting we're going to see that pullback in the rally."
Cashin, among other things, cited the narrow nature of the rally and how many of the stocks attracting interest were "low-priced stocks," often a sign of indiscriminate bottom fishing. In his March research note, Stovall said the S&P 500 could post a rally in which it recovered some 22 percent of what it lost during the bear market in a 39-day period, the historical rule.
"If history repeats itself, we would probably go through a retest," said Stovall. "We're just at the beginning of the retest today."Over the years, that retest has averaged about 20 days from the recovery high and knocked 7 percent off the market.
This time, Stovall says, the indicators point to "a correction of some magnitude," perhaps along the lines of the 14-percent hits suffered during the 1973-75 and 2001-2002 bear-market periods. The S&P, for instance, could fall back to 750 after traveling from its March 9 low of 660 to just under 870 last Friday.
Others see a more moderate pullback. Hedge fund manager Doug Kass, for instance, recently told clients to expect a decline of 5-6 percent after the recent rally.
"I can understand why people could be concerned about jumping back into this rally," says Stovall. "They were lulled into thinking there was a bottom in March '08."
A quick look at recent history might suggest why this rally may be too good to be true.
In the 2001-2002 period, there were major bear market rallies in a roller coaster pattern. The Dow, for instance, fell from from 9,808 in early May to 7,702 in late July. By late August, it was back up to 9,053 before quickly spiraling down to 7,286 in the second week of October.
That's not all. By late November, the blue-chip index was at the 9,800-level, only to drift back down again to the 7,500-level in March 2002. The bear market technically ended in October of that year and the Dow reclaimed the 10,000-level by mid December.
The timing of this rally also does not bode well for what lies ahead, says Jeffery Hirsch, editor of the Stock Trader's Almanac, who notes the market's traditional bullish period runs from November-April.
"Some of the old seasonality may not be in effect; that in itself is a negative indication," says Hirsch. "We've stalled at that 8000-ish resistance level and we've got the bad season coming on."
Hirsch notes that the Dow has had only four up months in the 17 dating back to Nov 2007--right after the record highs of October--and that the market has posted gains on only two Mondays since early December, suggesting investors don't want to jump back in after the weekend when they are traditionally loathe to be long.
That sort of bearishness does not mix well with seasonal performance, especially when investors remember the two previous major false bottoms of this bear market. "With people burned as much as they have been, they get out when they can," says Stovall, referring to those who may now be exiting the market after a huge run.
Uncertainty, says analysts, remains the dominant factor, from earnings to the economy to the government rescue package.
"It's unlikely anything in the real world can justify any sustainable move up in stock prices from here," says Awad. "We're likely to go through a period of great confusion, where the bulls and the bears tug it out and the real world is somewhere in between."
Right as earnings season swings into high gear this week, the Treasury will be releasing the first round of highly anticipated information on the bank stress tests this Friday, followed by the second installment May 8. "This week will tell the story," says Awad. "You have a lot of excuses for the market to correct and go down."
By: Albert Bozzo, Senior Features Editor | 21 Apr 2009 | 09:39 AM ET Text Size
That's what some market watchers are saying about Monday's sharp selloff, following a stunning-yet, some say, suspect-run-up of well over 20 percent from the standing bear market low of March 9.
"Whenever you get that kind of move in that short a period when news is still mixed, you're vulnerable to a setback," says money manager Jim Awad, managing director at Zephyr Management. "We've gone from the bear market to the never-never land."Caution and skepticism has been building in some quarters recently, particularly as the Dow Industrials hugged a 200-point trading range over the 11 sessions going into Monday.
To some, however, the writing was already on the wall late last week, even as the major indices edged to new highs Friday in their spring sprint. "This thing is due," veteran market watcher and UBS floor operations director Art Cashin told CNBC early Friday. "I'm betting we're going to see that pullback in the rally."
Cashin, among other things, cited the narrow nature of the rally and how many of the stocks attracting interest were "low-priced stocks," often a sign of indiscriminate bottom fishing. In his March research note, Stovall said the S&P 500 could post a rally in which it recovered some 22 percent of what it lost during the bear market in a 39-day period, the historical rule.
"If history repeats itself, we would probably go through a retest," said Stovall. "We're just at the beginning of the retest today."Over the years, that retest has averaged about 20 days from the recovery high and knocked 7 percent off the market.
This time, Stovall says, the indicators point to "a correction of some magnitude," perhaps along the lines of the 14-percent hits suffered during the 1973-75 and 2001-2002 bear-market periods. The S&P, for instance, could fall back to 750 after traveling from its March 9 low of 660 to just under 870 last Friday.
Others see a more moderate pullback. Hedge fund manager Doug Kass, for instance, recently told clients to expect a decline of 5-6 percent after the recent rally.
"I can understand why people could be concerned about jumping back into this rally," says Stovall. "They were lulled into thinking there was a bottom in March '08."
A quick look at recent history might suggest why this rally may be too good to be true.
In the 2001-2002 period, there were major bear market rallies in a roller coaster pattern. The Dow, for instance, fell from from 9,808 in early May to 7,702 in late July. By late August, it was back up to 9,053 before quickly spiraling down to 7,286 in the second week of October.
That's not all. By late November, the blue-chip index was at the 9,800-level, only to drift back down again to the 7,500-level in March 2002. The bear market technically ended in October of that year and the Dow reclaimed the 10,000-level by mid December.
The timing of this rally also does not bode well for what lies ahead, says Jeffery Hirsch, editor of the Stock Trader's Almanac, who notes the market's traditional bullish period runs from November-April.
"Some of the old seasonality may not be in effect; that in itself is a negative indication," says Hirsch. "We've stalled at that 8000-ish resistance level and we've got the bad season coming on."
Hirsch notes that the Dow has had only four up months in the 17 dating back to Nov 2007--right after the record highs of October--and that the market has posted gains on only two Mondays since early December, suggesting investors don't want to jump back in after the weekend when they are traditionally loathe to be long.
That sort of bearishness does not mix well with seasonal performance, especially when investors remember the two previous major false bottoms of this bear market. "With people burned as much as they have been, they get out when they can," says Stovall, referring to those who may now be exiting the market after a huge run.
Uncertainty, says analysts, remains the dominant factor, from earnings to the economy to the government rescue package.
"It's unlikely anything in the real world can justify any sustainable move up in stock prices from here," says Awad. "We're likely to go through a period of great confusion, where the bulls and the bears tug it out and the real world is somewhere in between."
Right as earnings season swings into high gear this week, the Treasury will be releasing the first round of highly anticipated information on the bank stress tests this Friday, followed by the second installment May 8. "This week will tell the story," says Awad. "You have a lot of excuses for the market to correct and go down."
Monday, April 20, 2009
Dow & S&P 500 market analysis for 04/20/2009 Monday
Dow & S&P 500 market analysis
There is a lot of pent up selling pressure on the indexes. The MACD divergences on both daily and hourly are showing that we are all ready for a huge tank either this week or the next.
VIX is close to an important support at 33. On the best scenario, we may go through a bit of sideways movement in the coming days before the tank begins.
Direction for 04/20/2009 Monday: Down
Crude Oil (USO)
USO is still in a wedge that should break anytime soon. The wedge is indicated by the purple lines.
There is a resistance at 30 and support at 29. I believe USO should be breaking up above 30 in the next 2-3 days.
Direction for 04/20/2009 Monday: Gap down and then up
There is a lot of pent up selling pressure on the indexes. The MACD divergences on both daily and hourly are showing that we are all ready for a huge tank either this week or the next.
VIX is close to an important support at 33. On the best scenario, we may go through a bit of sideways movement in the coming days before the tank begins.
Direction for 04/20/2009 Monday: Down
Crude Oil (USO)
USO is still in a wedge that should break anytime soon. The wedge is indicated by the purple lines.
There is a resistance at 30 and support at 29. I believe USO should be breaking up above 30 in the next 2-3 days.
Direction for 04/20/2009 Monday: Gap down and then up
Thursday, April 16, 2009
Dow & S&P 500 market analysis for 04/16/2009 Thursday
Dow & S&P 500 market analysis
An evening star was formed at the top of the channel on daily charts two days ago for both indexes. While this is happening, there is a huge MACD divergence on the daily too. We are on our way down now. There will be 1-2 more days of resistance testing before we head down to the 50 day MA at 800 on the S&P.
Direction for 04/16/2009 Thursday: Down
Crude Oil (USO)
Both Crude and its ETF, USO are forming a wedge which may give way sometime early next week. I am still not sure which way it will give way yet, but from the looks of it now, it looks like it may break down to around 26 on USO.
Direction for 04/16/2009 Thursday: Sideways with decreasing volatility
An evening star was formed at the top of the channel on daily charts two days ago for both indexes. While this is happening, there is a huge MACD divergence on the daily too. We are on our way down now. There will be 1-2 more days of resistance testing before we head down to the 50 day MA at 800 on the S&P.
Direction for 04/16/2009 Thursday: Down
Crude Oil (USO)
Both Crude and its ETF, USO are forming a wedge which may give way sometime early next week. I am still not sure which way it will give way yet, but from the looks of it now, it looks like it may break down to around 26 on USO.
Direction for 04/16/2009 Thursday: Sideways with decreasing volatility
Monday, April 13, 2009
Dow & S&P 500 market analysis for 04/13/2009 Monday
Dow & S&P 500 market analysis
Having rallied in frenzy for the past 2 trading days, I believe the indexes are in for a correction/profit taking today. Futures are pointing down and the news of GM declaring bankruptcy by the 1st of June is indeed very bad for the market.
Today, my first support is at 825 on the S&P. There is also a MACD divergence down on the S&P hourly charts. However the overall trend is still up for now.
Direction for 04/13/2009 Monday: Gap down then up
Crude Oil (USO)
Crude futures are moving down today. Reports of oversupply are weakening the price of crude. However we are still in an uptrend with support at 50.5 for /CL and at around 30 for USO. I expect crude prices to start seeing some strength in the coming weeks.
Direction for 04/13/2009 Monday: Downside consolidation
Having rallied in frenzy for the past 2 trading days, I believe the indexes are in for a correction/profit taking today. Futures are pointing down and the news of GM declaring bankruptcy by the 1st of June is indeed very bad for the market.
Today, my first support is at 825 on the S&P. There is also a MACD divergence down on the S&P hourly charts. However the overall trend is still up for now.
Direction for 04/13/2009 Monday: Gap down then up
Crude Oil (USO)
Crude futures are moving down today. Reports of oversupply are weakening the price of crude. However we are still in an uptrend with support at 50.5 for /CL and at around 30 for USO. I expect crude prices to start seeing some strength in the coming weeks.
Direction for 04/13/2009 Monday: Downside consolidation
Sunday, April 12, 2009
Analysis of the US market rally
Dow & S&P 500 market analysis
I’m finally back! Almost died from food poisoning. For 2 days, I couldn’t get up from bed. Now, I’ve got almost all my energies back.
Anyway the markets rallied up to a high of 856 for S&P and 8083 for the Dow. And seeing that the indexes did not make a 5th candle reversal on the weekly charts, we might still be going up for the next 2 weeks.
Weekly charts for the Dow
Weekly charts for the S&P 500
As you can see from the charts, we had broke the 20 week moving average and since 4 weeks ago, the weekly for both indexes had been showing divergence up. We might have some more momentum to continue to go up above 8,500 for the Dow and 900 for the S&P with a few dips along the way.
Daily charts for the Dow
Daily charts for the S&P 500
As you can see, the MACD is already forming divergences down on the daily charts. Last year, the indexes formed divergent 6 peaks on the MACD from the 18th March 08 to its highest point on the 19th of June 2008 before the huge tank that followed. I believe this year, the same thing is forming. The MACD had already formed 3 peaks since the 10th of March 2009 and is in the midst of forming the 4th. Since the last MACD peak took 5 days to form, this current one should not take more than that to complete.
Lastly, I believe that this a bear rally. My bottom for this crisis is much lower at around 600 for the S&P and maybe 5,500 for the Dow. We should be turning back down to this level sometime after this current MACD divergence runs out.
I’m finally back! Almost died from food poisoning. For 2 days, I couldn’t get up from bed. Now, I’ve got almost all my energies back.
Anyway the markets rallied up to a high of 856 for S&P and 8083 for the Dow. And seeing that the indexes did not make a 5th candle reversal on the weekly charts, we might still be going up for the next 2 weeks.
Weekly charts for the Dow
Weekly charts for the S&P 500
As you can see from the charts, we had broke the 20 week moving average and since 4 weeks ago, the weekly for both indexes had been showing divergence up. We might have some more momentum to continue to go up above 8,500 for the Dow and 900 for the S&P with a few dips along the way.
Daily charts for the Dow
Daily charts for the S&P 500
As you can see, the MACD is already forming divergences down on the daily charts. Last year, the indexes formed divergent 6 peaks on the MACD from the 18th March 08 to its highest point on the 19th of June 2008 before the huge tank that followed. I believe this year, the same thing is forming. The MACD had already formed 3 peaks since the 10th of March 2009 and is in the midst of forming the 4th. Since the last MACD peak took 5 days to form, this current one should not take more than that to complete.
Lastly, I believe that this a bear rally. My bottom for this crisis is much lower at around 600 for the S&P and maybe 5,500 for the Dow. We should be turning back down to this level sometime after this current MACD divergence runs out.
Thursday, April 9, 2009
DOWN WITH SEVERE FOOD POISONING
Hi everyone, I’ve been down with severe food poisoning during my trip to Indonesia. The doctor said it’s due to some bacteria in my food, hence the delay of 2 days before I started having around 39 degree fever. The headache and body aches was also too much to bear hence I decided to give myself a one week break to recover. I will start writing on my blogs again next Monday. The chart patterns over the past 2 weeks have been very interesting too. Hope to share it with you guys.
Wednesday, April 1, 2009
Gone to Indonesia till Sunday
Dear loyal fans, I will be going to Indonesia on Wednesday 1st Apr 2009 till Sunday 5th Apr 2009 to settle some supplier issues for my furniture business. As i've not found a suitable replacement to write my daily market analysis, there will be no posts till then.
However i believe that there will be some profit taking by the market pros this week before the traditional April rally hence the indexes should end down this week.
Lastly i wish all of my fellow traders good luck and lots of fun for your trading!
However i believe that there will be some profit taking by the market pros this week before the traditional April rally hence the indexes should end down this week.
Lastly i wish all of my fellow traders good luck and lots of fun for your trading!
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