It Shouldn’t Take A Rocket Scientist…
The SPY and Qs are retaining
Friday’s hourly downtrends and testing critical long-term supports as we
approach midday, with the
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hitting a new yearly low and putting significant pressure on both markets. All
eyes, including those of both intraday inter-day traders, now turn
to whether hourly divergence will emerge followed by a trend turn to the north
to bail out a market that is as pathetic as the annual Red Sox fall swoon, or
whether we’ll be soon testing 2002 lows once again in the near future. For the
moment, mid-morning lows are holding as we approach the noon hour on the East
Coast.
It shouldn’t take a rocket scientist or even a Wall Street analyst to see
that the hourly chart holds the clues to the longer-term move from here, so keep
an eye on the emerging angle and price action relative to it. The 13-minute is
also providing strong short support for both markets, and we may be setting up
for yet more afternoon short opportunities on a pullback to it as I pointed on
in Friday’s
column. And while an eventual turn on the 13-minute may provide a
longer-term (relatively speaking) bounce opportunity, traders should continue to
respect the hourly on any contra-downtrend trades until proven wrong.
Monday September
16, 2002 11:30 A.M. ET
SPY
Why Fight ‘Em?
Revisiting and updating last Tuesday’s
column, it appears that many out-of-work Wall Street Internet analysts
(names withheld) have now turned into Vegas odds makers.
Superbowl underdog by 14 … Beat Spread by 17
Opening Day underdog by 3 … Beat Spread by 19
Week #2 underdog by 3 (6th straight week as a dog) … Beat Spread by 40
Yup, this is a trading column and I’m sure many could care less about the
Northeast NFL entrant. Yet, please bear with me on this as there are just some
incredible parallels to trading which I’ll again repeat: "They say
trade (1) with the trend and (2) what you see, not what you think." Yes,
this bubble too may and likely will burst at some point, but the parallels to
shorting the rising rocket Internet stocks on their early run and strong trends
in 1998 and 1999 BEFORE the low-risk turns and triggers are striking. Maybe the
Vegas folks can learn a thing or two about trends.
Good Trading,