This weeks range (April 01, 2009)

Despite the late selling in the SPY later in the day, note the thick band of support between 76.09 - 76.98. Only by breaking this does the SPY head lower to retest the lows.

Right now we are still within a trading range of 78.85 - 81, I hope in the coming days...the price pattern will not map out into a boring symmetrical triangle.

If the market did wanna make an impression to retest the lows watch out for a potential head and shoulders forming. Be warned not to trust any price patterns in this sort of market, hey....price patterns could be engineered....you need to accept the fact.

How many times have you been caught when the market rallies instead when you think a head and shoulders pattern is a reversal pattern...? So let trade the price action instead and stop wasting your time watching out for price patterns!

April will be a daytrader's month (April 01, 2009)

Hi folks, I am aware that there are quite a number of you who come over regularly seeking for some answers about maybe....whats coming next.

Let me share with you, I think April is a month to be very open minded with the market. Because I expect the market to pop and drop more frequently. So don't be overly bearish or bullish and remember to take your profits and learn not to get too greedy.

I sensed that the market was going to rally this morning because I happen to have IBM on my watch list. Frankly speaking I was gonna short IBM this morning, but changed my mind.

This was followed by some skeptical price action on the SPY for the first 1 hour of the day and sure enough the rally started when the financials and the transports joined the bounce.

From today's action, commodities were the worst performer due to cautiousness in the market about tomorrow's EIA report. Week after week, the story is more or less the same. Furthermore, there will be an ECB decision on a possible revision of the interest rate this Thursday. This adds some bearish sentiment on the Euro and will keep Crude Oil prices down for a short while.

The story on the charts still hasn't changed that much...will need to see what happens next

Ok, take care and good luck in your trading.

Euro is the key (March 30, 2009)

There are talks for ECB to lower interest rates by .50...hence a big tumble in Crude Oil prices back to the 50s.

Without commodities providing support for this rally in equities, the rally has to be fueled from somewhere else. After going through most of my charts most of the equities are touching or right beneath significant levels of resistance.

So I will expect the SPX to pullback coming into April, perhaps it might hold 800 this week but I expect a sell off to somewhere near 796 followed by 770.

However, do be prepared for any surprises especially from the Financials, Consumer Discretionary, Transports to resume any rally.

GS possible Monday Scenario (March 29, 2009)

Unlike OIH which sold off harder due the strengthening dollar....

The behavior of most financial stocks indicate possible sideways price action at least until the month end window dressing activities are over.

The chart below shows that GS still has not taken out a key support at 106.56. Therefore I am still neutral on taking any medium term short position. If I do go short on Monday, I will likely get out before the end of the day. A break of 106.56 should confirm that GS is heading for 94, 99.

More stocks with more room to go (March 27, 2009)

UPS is enjoying a lot of buying volume lately, will be interesting to see this go higher.


UNP, has a little more room to go.

Will WMT close the gap? (March 27, 2009)

WMT has an interesting setup and I think at some point in time....this stock will hit 55.

Fundamentally this stock has nearly complete monopoly in the retail sector for daily consumer goods. So I don't see why WMT will not go higher.

On the technical side, RSI is showing overbought. Perhaps this should be a candidate to buy on dips.