Monday, December 1, 2008

12.01.08 - Negative Trend Day

It was inevitable that we would see some level of pullback after five historic up days. However, questions about the strength and sustainability of holiday retail sales on top of tensions abroad really sunk that battle ship -- I hope you were ready for it. Down volume is still trending solidly higher and the VIX is now over 63. It looked earlier like SPY $85 would hold, but really we've seen nothing but continued lower-lows and highs and major indices are now down 5-6%.

By request, I am experimenting with Twitter posting to the right. My "follow" name is "mrkt_rwnd". This cool little widget supports real-time updates and tracking by web or mobile device.

INO TV - 500 Technical trading training videos posted on-line with unlimited one-year access for only $99.95, such a deal!

10:20AM PST - I am covering most shorts near this area (SPY $84.50-85.00), which roughly corresponds with the 10-Day Moving Average and lows from earlier in the Fall excepting the November 20-21 down draft.

11:40AM PST Bernanke - "No comparison between now and the Great Depression..." Except for the volatility and the charts! Ten-Year Treasuries have fallen off a cliff to 2.70%. I'll short bond ETFs with much more move for a trade, maybe at day-end. Update - Got some TLH off, but hard to find inventory on anything in this duration range - all hard to borrow. Does anyone know of inverse long bond ETFs?

12:25PM PST - Now looking at support near SPY $81-82 (SPX 815 top end) for next couple days should we see downside follow through.

12:45PM PST - Obviously let most of my shorts go to early. Will probably hold long overnight with a small position.

1:10PM PST - Volume was relatively light. Additional length of the recession? 6-9 more months easy, just off the cuff. What do you think?



Anonymous said...

Pres. Elect Obama's team will take quick action to shock the economy. That coupled with the public's perception that the country has competent leadership and a start on repair of our international relations will lead to a upswing in early '09 Doc. M.

Randy Reis said...

Thanks for the Twitter!!!!!!


Jeff Pietsch CFA Esq said...

If the "official" recession does indeed run 6-9 months longer, your suggested stock market recovery could well pan out Doc. Good to hear from you again.