Wednesday, September 2, 2009

State of the Market - 9/2/09

Today was a "nothing" day on Wall Street, meaning nothing happened. After some choppiness early on, the S&P traded in about a four-point range for the rest of the session and the Nasdaq traded in about a seven-point range for the remainder of the session. There was a small sell-off during the last ten minutes of trading, but the indices still ended up basically flat. Volume appears to be a good deal lower than yesterday.

I guess today could be interpreted as both bullish and bearish depending on how you look at things. It is positive I guess that we didn't get further selling and follow-through from yesterday's nasty session. At the same time, it is disconcerting that the bulls couldn't push this thing any higher than it was after the beatdown they took yesterday. I am still looking at either the August lows, the June highs, or the 50 day moving average as the likely area we see at least some sort of bounce. We could drift down there over a week or so or fall sharply to that area. I don't know which one it will be.

Both of the "bounce" setups I posted last night (WATG and KONG) did reverse and close higher today - I just have to see if they get follow-through to the upside. Meanwhile, the other setups I showed last night (RDN, AM) leaked lower today and are just barely holding support. I am still watching these as possibilities on the long side. I am hesistant to short at this moment unless we just form a bear flag right here on the indices. If that happens over the next week or so, then I would abandon any short-term bullishness I have left. I still think a further decline followed by a short-term bounce of significance is more likely.

That's about it - a slow day doesn't leave me with much to write about. Good luck Thursday.


Anonymous said...

Mac, I was directed to the larger one on when I click one of your charts. Norton instantly warned me of identity theft virus on that site. Are you aware of it? Are we safe as long as we do not click on that link? Thanks! Elena

Mac said...

Sorry about that, Elena - I checked the pictures on my computer and my antivirus didn't pick up anything. I've never have had any problems with it. If you have more problems, let me know. Thanks.