JeopardE There is going to be a need for a </i>trigger event</i> to move Crude prices upward as that chart is suggesting.
Sorry about the overly wide image above ... Now a bunch of charts showing how I see the market right now: A little bit of commentary here: housing has broken the three month downtrend, and I believe this is part of a head and shoulders pattern in progress with a base at the resistance line of 13. But as far as I'm concerned, once the 200day MA is broken this bottom is confirmed. Remember, housing was the initial cause of this bear market, has almost always led the market, and is expected to bottom before other sectors. The financials were next in line to collapse after housing. And in that same progression, they're trailing the housing bottom pattern. The S&P 500 appears to now be following suit. I found today's close above the retracement level of 870 (despite the horrible jobs report) to be extremely bullish, but as I indicated in the comment above, the market needs to follow through next week to confirm. You'll notice positive momentum divergence on the MACD on most of these charts. The next chart shows further evidence on the weekly chart. I still think oil bears some correlation to the dollar even though it has decoupled from equities. I expect the dollar to collapse, and some serious inflation to ensue as commodities and oil rally hard. There's my take on the market right now. All that said, many of these patterns are still contigent on a follow through from the market next week. A consolidation/rounded reversal type of week isn't out of the question as investors ease themselves back into the fray, but there is still a possibility that the bulls get taken out to slaughter and our rally gets soundly rejected again like it did on Monday. Either way, Monday should be very interesting.
I was watching CNBC earlier when they mentioned that... it's impressive until you look at a 3-month chart... scary...
What's scary is the potential for this to happen many more times during the rebound. The roulette analogy is very apt right now!
I did like what the CEO said about them being well-capitalized to weather the storm, but I keep thinking to myself "how many times have I heard this in the past year?" The stock was under $5 on Nov. 21. It almost hit $16 I think on Friday before pulling back at the end.
An interesting video to watch is the recent interview of Nassim Taleb. Sell The Rallies, says Nassim Taleb
Sell this rally at your peril. As I expected, the market has followed through on Friday's rally. This is the big one. The downtrend has been convincingly broken as I indicated in my charts. I'm looking for the S&P to threaten 1100 or even higher here. Right now the correct move is to buy pullbacks, not sell rallies.
I'm liking UAUA with a price target of around $17 which would satisfy the measurement of the completed inverted H&S pattern.
the right move is to trade the volatility. we are not going to get sustained follow thru to the long side so when the short squeezes happen look to get short for profit taking. conversely, since it is likely that we finally have some support for the market due to all of the govt bs you have to look to get long when we have a huge random selloff...likely after a couple days of profit taking. the downtrend is not broken just because we are gonna be in a volatile range for the foreseeable future. the larger trend is that people are going to look to get out of the market on rallies.
If you're a trader, then you can profit selling rallies and buying weakness (just like you have) especially since you have the liberty of being able to close your positions quickly. But for people who are not intraday traders, I find this move to be very significant with respect to the larger trend. Obviously this is still a highly volatile environment, no question, and chasing the rally is still a Bad Idea (tm). But I think the way to maximize profits right now is to buy on pullbacks. As for right now, I think the market is still a little overbought even despite the modest pullback in the last 15 minutes. I'm also watching oil closely. I see a lot of commodity plays are breaking out, but despite today's rally, I think we need to see oil get back to $50 before we can call that trend over.
I put some stops in since I can't sit and monitor all day.. I hope I put in enough buffer for any random downswing that's not a real drop..
Sideways trading mode today...the rally is being sustained, and the bears cannot like what they're seeing. I still expect a pullback, but it looks like it's not going to happen today. There is a distinct possibility that the market trades sort of range-bound for a while with a bias to the upside and continued volatility, but I'm getting the sense that there is a little less skittishness in the markets this time around. I went long DRYS again at 6.60 (after it became rather obvious that it was not going to give back any of its gains). Keeping it on a short leash but man has that paid off handsomely already.
No need to beat yourself up on that one, I myself I'm being patient. There is still a TON, TON of upside on oil, as oversold as it is. I really don't see any reasonable scenario where a rally bounce wouldn't get as high as $60.
