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$SPX Psychotic Line Resistance

Posted by Investing Freak on October 21, 2009
Market Analysis / Comments Off on $SPX Psychotic Line Resistance

It was a fun day today.
Market opened up and rallied 10 points by 10:45AM.  It was all downhill from there but the big kicker came at 3:10-4PM when the market dropped 17 points.

I will let 2 charts and this link be the hint of what I think we are going to do in the next few days at least.

Chart 1 is a closeup of the past month with the trend lines drawn almost a month in advance. (Click to enlarge)

spx102109

Chart 2 is a zoomed out view from where the rally began. (Click to enlarge)

spx102109-2

That’s all folks. These are the charts promised almost a week earlier.
Have a safe investing season this fall/winter it should be epic.

-K

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A Week in Review: SPX 1035 Oct 1st Prediction Came True

Posted by Investing Freak on October 02, 2009
Market Analysis / Comments Off on A Week in Review: SPX 1035 Oct 1st Prediction Came True

I wanted to review a crazy wild week (7 market days or 9 days overall).
It all started with a twitter post  on September 23, 2009 at 9:24PM

It then followed with a blog post about the prediction since twitter is known from moving very quickly and people can miss things at a blink of an eye.
This was on September 25th  “S&P at 1035 by October 1st? I Believe it is doable.” ( I misspelled doable on the original post.)

We were in a 3 day down move (23rd to 25th.)  When I did my weekend analysis I saw a familiar pattern which was similar to a “Kicker Bullish“.
That deserved its own post entitled “$SPX Stuck in a 9 Point range… which way will it Break?” Well next day we moved up 20 points.
I was not satisfied with the way the pattern was set up because S&P needed to open up at least 10 points above Instead it started at about the same price as the previous day.

The final blog post was written and titled “The One Day Rally Is Over” In brief, I stated that the pattern wasn’t satisfactory to be a real Kicker Bullish and also the TED Spread had been going higher for the past 2 weeks.  The TED spread measures the risk in the general economy.  With Risk going higher & the pattern looking weak, all I needed was some negative news and got it when S&P began cutting company ratings.

On October 1st I checked back on the market late in the day and to my surprise we had fallen 27 points.  the 1035 prediction was reached and breached right on the day I called.
So that is the week in review and the image below summarizes it even more visually.
(Click Image to Enlarge)
A-week-in-review
Have a good one,
-K

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The One Day Rally Is Over!

Posted by Investing Freak on September 28, 2009
Market Analysis / 2 Comments

Last night I posted about the S&P possibly having a Kicker Bullish Setup.
Well  The S&P Rallied 18.60 points to 1062.98.
The Setup was not executed perfectly (market would have had to gap higher today then go the distance)

All bets are off on an extended rally that needs to go higher than 1080.15 to be worthy of anything.

While the market rallied the S&P only traded at half its normal volume.
Stocks like Citigroup which had traded over a billion shares a day, are lately trading at less than 500 million.

The TED Spread which measures the general risk in the economy has been rising the last couple of weeks. today alone it rose 5.42% which means interbank loans are now riskier.  This is still not significant enough and I would like to see another 33% increase in the TED before I really put a lot of my sidelined money on the short side.

We had MBIA (MBI) stock trade up  11.38% today only to be down over 7% in after hours.. why?

Standard & Poor’s on Monday cut its ratings on MBIA Inc and its structured finance insurance arm, MBIA Insurance Corp, citing an expectation the company will continue to take significant losses from insuring risky loans. … The outlook for both companies is negative

Well if that wasn’t enough the dollar has began to show some strength as well despite the almost 20 point one day rally.

Bottom Line:  Be very careful if going long from here on out. The false optimism game has been played for far too long and you might get stuck holding a worthless institutional stock come October.  It’s also end of month markup so for the next few days prices might be kept afloat by institutions.

Have a good one.

-K

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