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.


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Fake correction followed by a fake rally?

Posted by Investing Freak on August 27, 2009
Market Analysis / 1 Comment

The past 4 days The S&P and many other markets have traded within a very narrow range.
There have been doji candles galore. trendlines, averages, bullishness ratios and even the Elliot Wave expert said rally is ending and a correction will come sooner or later that will surpass the march low.

I have taken the liberty to put up a few $SPX charts with possible short term outcomes.

The big picture is in the first image (Click to Enlarge)
I am looking for the S&P to go to 1010 to lure in bears and then bounce off the trendline and make a higher high to fool the  bulls and shake the bears. Then lastly (not in these pictures) I am looking at 950’s as a conservative bet.

spx-aug27-09Here is a closer look short term view.  Upside target is 1040-1050.
spx-aug27-09-closeI hope you enjoy my opinion and feel free to comment your own.

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SPY Possible Bullish Pattern

Posted by Investing Freak on February 28, 2009
Market Analysis / Comments Off on SPY Possible Bullish Pattern

While this past week has been tough on many investors, I have made my fair share of profits trading SKF intraday.
You can check out my covestor page  and see my YTD performance to see how much more disciplined I have become in 2009.

Looking at the SPY 1minute charts, there seems to be a possible Bullish Three Drives Pattern developing.
Using Fibonacci retracements I created the chart below.  Basically when SPY hits 73.39 area there is a strong case for a rally to kick-start. I do not know how strong the rally will be but you might not want to short on Monday.

Here is the SPY 1 minute chart (Click to Enlarge)


As Always, Feel free to add anything on this topic or ask any questions you might have.

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5 Days Up…5 Days Down?

Posted by Investing Freak on November 29, 2008
Market Analysis / Comments Off on 5 Days Up…5 Days Down?

Well I am back I am sorry for posting once a month.

Past 5 days we have had a huge rally but the volume has gone the complete oposite.
It seems like someone has been manipulating  the market instead of this being a real rally. 

S&P is still well within it’s downtrend channel that started back in september so This rally is another setup for failure.  Notice the volume that I mentioned…

I dont have much to say other than I am short at the moment.

I hope everyone had a good thanksgiving and time to get back to work. 

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