Thursday, February 7, 2008

02.07.08 - Possible Bottoming?

We are observing a possible near-term bottoming today, which is good to see on bad news -- and we did get signals to put on extra long exposure, although I only took partial positions.

Small-caps and Transportation are showing relative strength. I'd like to see a stronger Tick before going whole hog in here (flat right now). If you are an investor, there will still be plenty of opportunity to get in. This bear is still on the prowl.

1:40PM CST UPDATE: Note how the five-day moving averages posed strong resistance across the board. This is technical selling on top of effectively technical buying. Now we need to see if the rising VWAPs/SPY pivot will hold. They may present a second chance entry for a bounce play. But again, manage your stops closely or trade with smaller positions, this is only day one of a rally attempt and we still have over an hour to go.

Blog to Read: Woodward ~ Bear Market Statistics

2:10PM CST UPDATE: Careful of downward vol into the close...

2:35PM CST UPDATE: Today has been by the book, but I can't post fast enough to keep up with the vol, should I install a Twitter plug-in gang? Meanwhile, let's see if we can't test that five-day again tommorrow. The more runs up to it, the higher the likelihood of a breakthrough. Of course, at present it is still sloping downward and trades against that indicated trend can be considered risky.


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