Wednesday, April 15, 2009
SPX Key supports lines and larger fib target
807 and 753 are the two key numbers. Not pictured is that 753 was also very near the close on 11/20 and 11/21(but not the spike low). Most support lines were drawn on a 60m chart, but I used daily for more powerful picture of how overbought all indicators are.
XLF is overdone - stick a fork in it.
Looks pretty similar to Dec/Jan IMO. Fake out sell signs to continue overbought situation. Get the short squeeze. Last few days of big up volume for the suckers to come in and BAM! This time the indicators are even more ripe and the rising wedge formation is much better. I'm looking for a fall to the 50dma and 50% retrace and will regroup there.
Tuesday, April 14, 2009
Could AAPL be toast?
Target 102.75. Not sure about time frame but sooner than later. The intersection of the downward sloping blue line and the purple dashed for a backtest would be interesting.
P2 Playout with numbers
The BB's on the weekly VIX are 21pts apart - pretty narrow and we're trading near the bottom. Might be more power in 2 that expected or are they narrowing for the 3.1.2 move? Time will tell. Going back a few weeks when I got ahead of myself trying to figure out where P2 could take us - a full retracement is not out of the question is it? 1.1.2 was massive. 3.1.2 will be lots of fun. 3.3.2 might be a moon shot. This has me wondering if we are still possibly in P1. Thanks.
I found a nice write up on the "Fake Recovery" that as you read thru it you can't help but read the waves as it plays out. It gives really good "scenarios" regarding recovery and why (P2), but also why it won't work in the end (P3). This is a scenario that takes us up in P2 thru the 2010 elections and crumbling down in P3 after them. This is a really well done post IMO from Naked Capitalism guest poster from the site Credit Writedowns.
http://www.nakedcapitalism.com/2009/04/guest-post-fake-recovery.html
Here is a hypo playout for 1.2
Start End Length Retracements
Wave 1 667 864 197
Wave 2 864 766 99 50% Retracement
Wave 3 766 1061 296 1.5 Wave 1
Wave 4 1061 913 148 50% Retracement
Wave 5 913 1110 197
Wave 1.2 total Length: 443
% Market Gain: 0.665
Wave 2.2 Total Length: 222
Wave 2.2 Target: 889 50% Retracement
See the % market gain - there is that 666 number again.
I found a nice write up on the "Fake Recovery" that as you read thru it you can't help but read the waves as it plays out. It gives really good "scenarios" regarding recovery and why (P2), but also why it won't work in the end (P3). This is a scenario that takes us up in P2 thru the 2010 elections and crumbling down in P3 after them. This is a really well done post IMO from Naked Capitalism guest poster from the site Credit Writedowns.
http://www.nakedcapitalism.com/2009/04/guest-post-fake-recovery.html
Here is a hypo playout for 1.2
Start End Length Retracements
Wave 1 667 864 197
Wave 2 864 766 99 50% Retracement
Wave 3 766 1061 296 1.5 Wave 1
Wave 4 1061 913 148 50% Retracement
Wave 5 913 1110 197
Wave 1.2 total Length: 443
% Market Gain: 0.665
Wave 2.2 Total Length: 222
Wave 2.2 Target: 889 50% Retracement
See the % market gain - there is that 666 number again.
Monday, April 13, 2009
GS chart
Light blue rising wedge or the black channel both running into the blue channel with overbought indicators should turn this puppy. Down a little AH after early earnings release. Purple dashed line is the wedge target. I'm looking at a pullback to 100 or 95 double fib area. MACD and RSI wedges should be ending. I expect RSI to pull back to lower trendline near 50 for this bottom and for MACD to get near lower trendline as well.
Bill Moyers interviews William K. Black
This will make you feel pretty sick IMO. It is a little long but you need to hear the whole thing.
"Now Black is focused on an even greater scandal, and he spares no one — not even the President he worked hard to elect, Barack Obama. But his main targets are the Wall Street barons, heirs of an earlier generation whose scandalous rip-offs of wealth back in the 1930s earned them comparison to Al Capone and the mob, and the nickname "banksters." "
My favorite exerpt -
BILL MOYERS: Yeah, and this week in New York, at this conference, you described this as more than a financial crisis. You called it a moral crisis.
WILLIAM K. BLACK: Yes.
BILL MOYERS: Why?
WILLIAM K. BLACK: Because it is a fundamental lack of integrity. But also because, if you look back at crises, an economist who is also a presidential appointee, as a regulator in the Savings and Loan industry, right here in New York, Larry White, wrote a book about the Savings and Loan crisis. And he said, you know, one of the most interesting questions is why so few people engaged in fraud? Because objectively, you could have gotten away with it. But only about ten percent of the CEOs, engaged in fraud. So, 90 percent of them were restrained by ethics and integrity. So, far more than law or by F.B.I. agents, it's our integrity that often prevents the greatest abuses. And what we had in this crisis, instead of the Savings and Loan, is the most elite institutions in America engaging or facilitating fraud.
http://www.pbs.org/moyers/journal/04032009/watch.html
"Now Black is focused on an even greater scandal, and he spares no one — not even the President he worked hard to elect, Barack Obama. But his main targets are the Wall Street barons, heirs of an earlier generation whose scandalous rip-offs of wealth back in the 1930s earned them comparison to Al Capone and the mob, and the nickname "banksters." "
My favorite exerpt -
BILL MOYERS: Yeah, and this week in New York, at this conference, you described this as more than a financial crisis. You called it a moral crisis.
WILLIAM K. BLACK: Yes.
BILL MOYERS: Why?
WILLIAM K. BLACK: Because it is a fundamental lack of integrity. But also because, if you look back at crises, an economist who is also a presidential appointee, as a regulator in the Savings and Loan industry, right here in New York, Larry White, wrote a book about the Savings and Loan crisis. And he said, you know, one of the most interesting questions is why so few people engaged in fraud? Because objectively, you could have gotten away with it. But only about ten percent of the CEOs, engaged in fraud. So, 90 percent of them were restrained by ethics and integrity. So, far more than law or by F.B.I. agents, it's our integrity that often prevents the greatest abuses. And what we had in this crisis, instead of the Savings and Loan, is the most elite institutions in America engaging or facilitating fraud.
http://www.pbs.org/moyers/journal/04032009/watch.html
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