Marketbeat for Sept 4th, 2008

DOW: -345pts to 11,188 (3%)
S&P500: -38pts to 1,240 (3%)
NASDAQ: -74pts to 2,267 (3.2%)
RUSSEL 2000: - -20pts to 721
TSX: -301pts to 12,835

The Market Shows its hand....and its not bluffing

Internals Chart



Todays market action may have seemed bleek to the Bulls ready to get back into action. But for short term traders it was at least some decisive action that we can use. The Market has finally showed its hand, to the downside breaking belwo some very serious support on the ES' (1260) which has held as support since the S&P500 started channeling early August. Does this move down mean that all hope for a bullish market is gone? No. But it does give us an idea of where the market wants to move for the time being, and that direction is emphatically down. One technical sign that the Bears still hold the cards is seen clearly on monthly (3-6 month) chart of the $SPX (Click to see chart). Another trader pointed out today that if you draw a Fibonacci retracemen from the lows of July 15th to the highs of August 11th, todays price action not only broke the 50% retracemen line but crushed thru the 61.3% line as well. When using the Fibo retracemen on a chart you ideally wanna see a bounce at either the 23.8% / 38.2% or at the most the 50% line, when the price action takes it past the 50% and more so the 61.3% its a technical sign saying that the bulls (in this case) ran out of steam and the Bears have resumed control. On the bright side this big bearish move down also gives us a bunch of decent bearish and bullish set-ups.

$SPX Chart



Under the hood the internals confirmed this intra day drop. Intraday volume levels were nearly flat with yesterdays numbers, with a slight increase in volume on the NASDAQ (probably due to distrubution). Intraday breath readings were phenomenal with readings of 12 : 1 and 14 : 1 on the NYSE and NASDAQ. The Trin hit parabolic numbers intra day hitting 4.33 on the NASDAQ and 2.82, this brings us to a counter trend idea that was discussed by Think or Swim's shadow trader (Click here to go go Shawdowtrader.net). The idea comes from John Carter. His lesson is featured on pg. 96 of his book Mastering the Trade ( Click To Buy Book) - If the Trin closes above 2.0, the market has an 80% chance of rallying the next day. If the Trin closes below 0.60, the market has a 80% chance of selling off the next day. (sometimes it works, sometimes not)

The internals into the close confimed the bearish move with bearish numbers across the board:

NYSE Breathe - 10.76 / 1
NYSE TRIN - 2.6
NASDAQ Breathe - 2.15 / 0.2
NASDAQ TRIN - 2.85
CORE SECTOR LIST - 16 / 0
VIX - +2.7 to 24.10

Unusual Options Activity:

SD / FSLR / CSCO

Stocks in Scope:

WYNN (watch for confirmation, break of 90)
ILMN
ESRX
V
ARO

Food 4 Thought to Use with Stocks:
Before I go for now, I have a suggestion for anyone who could use a little spark to their weekend routine, its the Shadow Trader weekly Video ..." ShadowTrader Video Weekly is produced by professional trader and ShadowTrader co-founder Peter Reznicek. Essential to all traders and investors, ShadowTrader Video Weekly breaks down and analyzes the preceding week's market action in the S&P, Dow and Nasdaq to help you better understand the market and be more successful trading it."

CLICK HERE TO SIGN UP FREE!!

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Important Disclaimer! This website is for entertainment purposes only. Equities, Futures, Options, and Currency Trading have large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Absolutely do not trade with money you can't afford to lose. This website is neither a solicitation nor an offer to Buy/Sell equities, futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this website. The past performance of any trading system or methodology is not necessarily indicative of future results. Absolutely consult your Registered Financial Adviser and your Risk Trading Plan before ever investing or trading any financial instrument!

Marketbeat for Sept 3rd, 2008

DOW: +16.13 to 11,533.05
S&P500: -4 to 1,273.41
NASDAQ -18 to 2,331.07
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NYSE Breath: 5.6/5.6 parody
NYSE Trin: 1.1
NASDAQ Breath: 1.6:1 negative
NASDAQ Trin: 1.86
a/d line: 1.5
Core sector: 11/5
VIX - .57
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The Market tryed to shrug off the beat down from the highs it took yesterday, but failed to even amount a rally up past the 1278 pivot. Around the 11 o'clock time frame (Eastern time) the ES' failed to hold 1280 and dropped under the mark for the rest of the day, meandering between 1278 and 1265 support. During the late day, the exchanges mounted a small push up to the 1275 mark on the ES (11550 on the $DJI DOW JONES) but still count not get over that point of resistance.

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Internals were neautral to bearish today with the NYSE Breath closing at parady while the NYSE TRIN closed at 1.1, THe Nasdaq faired a lil more bearish with the Breath closing at 1.6 : 1 to the bears and the Nasdaq trin closing at 1.86. The core sector list was 11/5 to the bears and the VIX closed 0.57 pts down.

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Stocks In Scope:

MICC (Bearish): Bounce off highs
WYNN (Bearish): H&S
ILMN (Bearish): Breaking down
V (Bearish): Symetrical triangle forming, watch for break.

NTES (Bullish)
SINA (Bullish)
CLNE (Bullish)

ARO - Dark Cloud pattern formed today, while the Oct 40 calls are experiencing

unusual options activity.

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Food 4 Thought to Use with Stocks:

Today im featuring a very useful website pointed out to me by one of my fellow traders (good look out DM). The website is http://www.candlesticker.com/ and if you didnt catch it in the title - the site deals directly with candlestick patterns, Bullish - Bearish and Neutral....Ranging from high to low reliability. IF ever looking to expand your technical anaylsis skills this site is a good stop for FREE help. Below ive posted a couple of photos from the website...

Bullish Morning Star:


Bullish Mat Hold:


Bearish Dark Cloud:


Neutral Long Legged Doji:


Home Page For Candlesticker:


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Important Disclaimer! This website is for entertainment purposes only. Equities, Futures, Options, and Currency Trading have large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Absolutely do not trade with money you can't afford to lose. This website is neither a solicitation nor an offer to Buy/Sell equities, futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this website. The past performance of any trading system or methodology is not necessarily indicative of future results. Absolutely consult your Registered Financial Adviser and your Risk Trading Plan before ever investing or trading any financial instrument!

Marketbeat for Sept 2nd, 2008

Market Internals Chart



The Market opened up on the highs of the day today, looking like the Bulls might of returned from the long weekend with stride. However, today's intra day action told more of the story of the Bears than bulls, with the markets quickly dropping from those highs and retesting the lows of last week. On the ES futures, it was an interesting 24 hours, as the market sold down to the S1 last night around 1am, bouncing up more than 100 pts on the E-mini future around 3am, helping the early morning gap. But with the market filling in these gaps on the exchanges, the ES quickly followed suit and retraced that move quickly even breaking the S1 finding support at S2 (1271.5). The internals were a bit of a mess, starting off positive but moving into the negative after lunch. Oil got taken out to the woodshed today, gaping down nearly 3 pts on OIL, closing down 3.21 for the day. The Vix has continued its climb up from fridays pre-weekend sell off, up 1.34 to 21.99.

ES FUTURES Chart


Internals:
NYSE BREATH: 5.5/5.08 - 1.08:1+
NYSE TRIN: 1
NASDAQ BREATH: 1.3/0.7 -
NASDAQ TRIN: 1.91

With such volatility in the broad exchanges, one could almost say that they indices are almost are volitile as high fliers like Google and Apple. We now patiently wait to see if the market will hold these lows and chop around, bounce off them or simply continue the free fall.


Unusual Options Activity:

Upside:
GTX (Nov 22.5 call)
DRIV (Sept 45 call)
LXK (Sept 45 / Oct 45)

Downside:
DRI
LMT

Stocks in scope:

WYNN (Watching for confirmation of H&S pattern, break of 91) See Chart
ILMN (watching the MA lines to act as resistance for a move down to prior support) See Chart
AMZN (Watching for break of 81 Support)

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Important Disclaimer! This website is for entertainment purposes only. Equities, Futures, Options, and Currency Trading have large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Absolutely do not trade with money you can't afford to lose. This website is neither a solicitation nor an offer to Buy/Sell equities, futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this website. The past performance of any trading system or methodology is not necessarily indicative of future results. Absolutely consult your Registered Financial Adviser and your Risk Trading Plan before ever investing or trading any financial instrument!