Saturday, December 20, 2008

Video - Weekend Market Summary - 12/20/08 - Bulls Running Out of Steam Soon?

Lots of good football games tomorrow so I am getting the video out early this weekend. Main points include:
  • We've gone basically nowhere the past two weeks. However, based on the many short setups I see and the very few nice long setups I see, I am starting to expect another significant move lower sometime in the next few weeks. Exact timing will be difficult.
  • The number of stocks up 50% or more in the past month is over 400 now, which is ridiculous. Tells me there are a ton of overheated stocks out there.
  • Current market is looking similar to mid-August 2008 to me. We moved sideways there for a while right around 50 day moving average before heading lower.
  • It's possible seasonality may push us a bit higher in the short-term, but I am expecting a turn sometime soon and will play it on the short side. Watch 920 and 880 on the S&P as key numbers and watch volume on a break of those levels as confirmation.

**** Here's a link that should work better for IE users if the first link doesn't work


Anonymous said...

what do you think the odds are we break down before the new years? i highly doubt it but i'm looking to scale into the inverse ETFs.


Mac said...

It is really hard to say - last year the 26th marked the top. The timing was different however - this year Christmas is a Thursday which gives basically two one-day trading weeks with December 26th and January 2nd on Fridays. My main clue will be volume - if we get some on a break of support lower, then I think we start moving lower for real.

Anonymous said...

Set your fibs off the 11/4 high and 11/21 low to see the current overbought condition at the .38 retracement line. Also, grossly in oversold territory, EEV, SKF, SRS, etc. The sell-off of the market that started on 8/15, ended, as far as EWT is concerned, on 10/17. Thus, the two overt waves down that occurred from 10/16 to 11/21, were waves 1 and 3 UP, absorbed in the overly pessimistic larger wave 3 down that started in mid Aug. Utilizing appropriate horizontal fibs, the 8/16/07 to 3/10/08 fractal and 3/17/08 to 10/10/08 fractal are precisely equal in length. That places the market at the top of what would have (or actually is) wave 5 up. Note the double bottom of mid March and the double bottom that should have been in mid Oct for confirmation. This would also have us just slightly above the lows of wave 3 down, a primary Fib belief. Mr. Fibonacci and Mr. Elliot would most likely both think that we are about to begin wave five down. I might even go as far as to say wave one down of large wave five down already started 3 days ago, and will be the extended sub-wave of the five sub-waves. Not to sound pessimistic or anything, but this could essentially make large wave three down an extended wave down. That would be good and bad. In time-frame, we would be close to the bottom. But in price action....


Anonymous said...

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