Thursday, April 30, 2009

Fade Out

This post would have been a lot beefier had I done it at the open this morning instead of now. You can blame my doctor for having a cancellation (I'm fine).

I wrote in the newsletter this morning that something was fishy about this breakout and that I would only close out shorts. I did not go long. As I write this, the Dow has just turned negative from its early triple digit gain so pass the tartar sauce.

Volume during the selling has been heavier for this part of the day than it has been in a while. And the crazy reaction to news was not the kind of stuff technical analysts use to gauge sentiment.

We'll have to see how this day ends before drawing any conclusions but if I were a betting man, which I am since I play in the markets, I would say that people are going to be talking about depression again soon. Only this time I will be buying a lot of stocks.

6 comments:

wave4 said...

Internal breadth indicators showed divergence when the SPY reached new highs ie the num of declining stocks (decl) was rising while the spread (adv-decl) was falling (looking at the 1 min chart), which adds further weight to your "fade out" post.

joed said...

What? A rising wedge in a overall down market with complimentary head fake!!! Whaddya thinks of PRU ??by the way excellant work as always!

joed said...

What? A rising wedge in a overall down market with complimentary head fake!!! Whaddya thinks of PRU ??by the way excellant work as always!

Quick Takes Pro said...

wave4 - yessir! (or yes ma'am - who can tell from an Elliott reference?)

Quick Takes Pro said...

joed - I can't comment on individual stocks in the blog. My subscribers would shoot me.

but I can say diversification is a myth in a bear market.

Steve said...

It looks to me like a pull back would find support at the 50 day moving average, then a rally would hit resistance at the 200 day MA = 965. By then the 50 day will be pointing upward and everyone will be talking bullish.

That's my play book until the market stops me out. My isn't gambling fun?