Wednesday, April 1, 2009

State of the Market - 4/1/09

Well, we got another strong day today on Wall Street, as the bulls clawed back from a very weak open to post strong gains for the second straight day. The day started with a gap lower, but the lows were put in right at that point and stocks moved higher from there right until lunchtime. From there, they pulled back slightly, tried to break out around 2:00, and then pulled back again before spiking back up into the close. All in all, an impressive day. Volume appears to be higher via IBD.

Technically, I said a few days ago that I was hoping for a bounce after Monday's disaster to possibly get short from. I was also hoping for some small bear flags to set up and in some cases (XLF and S&P mainly) that has happened. We are kind of in a small range here basically and I don't think I've missed a lot by not trading the past week or so. Resistance to the upside on the Nasdaq is around 1587 and around 832 on the S&P, so I will be watching those numbers and possibly will look to short a move up to that area.

I have to be honest and say that I still don't have a great feel overall for this market. It is possible we are just consolidating before moving higher, but I still have my doubts. I just have a problem believing we have already seen the bottom and that it is nothing but higher prices from here. At the same time, I know I don't want to discount anything, so I am trying to keep an open mind. Stocks I am watching on the long side (some of which are setting up nicely) include some solars (YGE, SOLR, STP), some retail (HGG, PVH, CTRN, MW, DRI), some precious metals (AU, SA, SLW, IAG), and other random stocks (STEC, NAV, PEGA, STSTI, OCN). These are the best that I see right now and will be what I will be watching. I have to admit that I like the way some of these are setting up. That's why I don't want to get too bearish and go all in on the short side, although I still will keep that option open, mainly focusing on the financials.

Good luck Thursday - I am sure it will be interesting. Jobs number Friday so be careful.

1 comment:

CW, portland, or said...

The market continues to get more buyers than sellers. I will start wading in a little with tight stops....using some of the ETF's