That's what it looked like to me. I'm interested in seeing what Lowry's has to say about today's session. Whether there was more selling pressure as stocks rose or whether the buying pressure actually picked up for once. Lowry's has been spot on so far about this bear market.
The Dow was up 331 points at the close or 2.94%. There appears to be a rotation out of the commodity stocks into other sectors like the financials, biotech, health care, and drugs. Yes today was a nice day, but its hard to get too excited about it. We've seen the same play over and over again. Namely sell like crazy into the sharp rallies , which is one of the reasons it's so difficult to trade this market. Anyone buying into these rallies is getting caught at the top every time. Will it happen again? Probably, that's why I bought a few OEX puts near the close. This is going to be a very short term flip kind of trade. After the frenzied run up late in the day, I expect an early pullback. If the market is able to shake off any weakness, and build off of today's strength then that's great. But right now, I'm not willing to give the market the benefit of the doubt. I think a good "tell" of whether this was new buying accumulation or just a skittish shorts racing for the exits is how the market reacts early in the session. If the market opens weak and just sort of drifts lower through the session, then it's short covering. No follow through indicates that the shorts over shot it to the upside.
Plus with today's close the NYA is just 70 points above the 8400 mid pivot. The weekly pivot range is 8385 - 8412.50. The August 1st High/Low of 8452 -8356 has already been taken out on both sides. However the July 1st H of 8660 still stands. The August low was put in yesterday at 8253, and the July 15 low is 8089. Two points of reference to keep an eye on. If this market is going anyplace to the upside, those lows are going to have to hold.
The Dow was up 331 points at the close or 2.94%. There appears to be a rotation out of the commodity stocks into other sectors like the financials, biotech, health care, and drugs. Yes today was a nice day, but its hard to get too excited about it. We've seen the same play over and over again. Namely sell like crazy into the sharp rallies , which is one of the reasons it's so difficult to trade this market. Anyone buying into these rallies is getting caught at the top every time. Will it happen again? Probably, that's why I bought a few OEX puts near the close. This is going to be a very short term flip kind of trade. After the frenzied run up late in the day, I expect an early pullback. If the market is able to shake off any weakness, and build off of today's strength then that's great. But right now, I'm not willing to give the market the benefit of the doubt. I think a good "tell" of whether this was new buying accumulation or just a skittish shorts racing for the exits is how the market reacts early in the session. If the market opens weak and just sort of drifts lower through the session, then it's short covering. No follow through indicates that the shorts over shot it to the upside.
Plus with today's close the NYA is just 70 points above the 8400 mid pivot. The weekly pivot range is 8385 - 8412.50. The August 1st High/Low of 8452 -8356 has already been taken out on both sides. However the July 1st H of 8660 still stands. The August low was put in yesterday at 8253, and the July 15 low is 8089. Two points of reference to keep an eye on. If this market is going anyplace to the upside, those lows are going to have to hold.
Pivots:
8875
8710
8545
8400
8235
8095
7930
Posts
2 comments:
Is that your value investing blog from 2007 that only has 3 posts? Have you switched methods and all of the sudden become a trend trader?
yes its mine. I didn't have the time or desire to follow through on the value site.
I didn't really switch from value to trend trading. I try to use a combination of approaches. I was a devoted valuee thru the 1990s believing that it was the best approach. Only when I looked at it in a truly objective manner did I acknowledge the gapping holes in the method. Value has its merits, but so does momentum, variant perception, growth, mean reversion, tape reading, special situations, and macro investing along w/ others like dart throwing. I think it boils down to when to use a particular approach, and keeping an open mind.
When all is said and done, the tape is the final arbiter whether the investor agrees with it or not.
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