Monday, December 8, 2008

12.08.08 - Where Is the Volume?

Volume is very light on this +3% up day with a large gap below. Nonetheless, indicators are highly positive at the moment as we continue to flirt with the daily VWAP.

10:30AM PST - Leading sectors are pointed south off of the 7:45 am highs, as is the AD line. Tick is beginning to waver as price sits spot on R1 (SPY $90). If we can't hold that line, we may yet see a gap fill.

11:40AM PST - Resistance, now support has held throughout the day. Perhaps no one wants to be short ahead of the bailout announcement. [Add:] Real question is what action we see after...

11:45AM PST - Note that 50DMA for SPY is $93. Normally this may be viewed as potential resistance, but also note that it coincides with typical-level short-side volatility stops. RSI-2 is 87. Hmmm... maybe an immediate pullback reaction followed by a longer-term cover rally on the second test? Just idle speculation here.

12:45PM PST - R2 proved strong resistance. As mentioned on twitter, I put on a short tracking trade and added to it. Already looking for exits. I heard the auto "news" may be coming out after the bell.

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