Market commentary for 03/03/2009
Good day!
AIG has become the harbinger of bad news for the financial sector. Until this black hole has a bottom it doesn't seem the market can get a floor under it. We had a third negative day with this becoming a trend day. The S&P closed at 1996 lows and the 700 point support area, INDU lost 7000 and next is support is the 1997 (6500-6400 points), The NASDAQ is now back to its previous support area from November of last year. Everyone is asking where is the bottom. I don’t think that anyone knows that answer right now. I think that is hard to predict. I think it is more important for us to know how to act when we are in that situation. If we look up the numbers the support area is here and that is previous low for COMPX, 700 points for the S&P and around 6500 points for the INDU so we can expect to see a bounce anytime. Also, I like SPY 60 min CCI divergence for a setup and I will follow only SPY (S&P) I will be focused on the bounce. Those who follow me know that I’m not interested in new short setups and only what I’m doing is waiting. In the trading room we tried to find a bottom, our trade finished breakeven and that is my maximum for now. I really can’t be sure where the bottom is, but I know how I will react in this market. That is very important,. As I told you several times in the past; we can’t be 100% sure of the future market direction. but we can know our risk level. For Tuesday my focus will be the same; longs or nothing. I’m not bottom fishing, but right now we can try to pick that on the small time frames (exactly what we did at Monday), or we can leave initial bounce and look for continuation. There is no other way. Those who still like short side,; use a small stop, because if bounce will come it can be fast and very strong. That not mean trend will be a change, but it will be enough to hurt you.
For tomorrow I will look for selling in the morning and the reversal. Problem is that market has room for exhaustion move and that scenario has fair odds. Every update will be in the room and again I invite all to join us. It is 100% free so you can’t lose anything.
Those of you that used to come into the trading room and stopped, I want to tell you I am back full time and welcome all of you to come again. There is nothing to lose since there is no charge for the service right now. I look forward to seeing you all there.
Good day!
AIG has become the harbinger of bad news for the financial sector. Until this black hole has a bottom it doesn't seem the market can get a floor under it. We had a third negative day with this becoming a trend day. The S&P closed at 1996 lows and the 700 point support area, INDU lost 7000 and next is support is the 1997 (6500-6400 points), The NASDAQ is now back to its previous support area from November of last year. Everyone is asking where is the bottom. I don’t think that anyone knows that answer right now. I think that is hard to predict. I think it is more important for us to know how to act when we are in that situation. If we look up the numbers the support area is here and that is previous low for COMPX, 700 points for the S&P and around 6500 points for the INDU so we can expect to see a bounce anytime. Also, I like SPY 60 min CCI divergence for a setup and I will follow only SPY (S&P) I will be focused on the bounce. Those who follow me know that I’m not interested in new short setups and only what I’m doing is waiting. In the trading room we tried to find a bottom, our trade finished breakeven and that is my maximum for now. I really can’t be sure where the bottom is, but I know how I will react in this market. That is very important,. As I told you several times in the past; we can’t be 100% sure of the future market direction. but we can know our risk level. For Tuesday my focus will be the same; longs or nothing. I’m not bottom fishing, but right now we can try to pick that on the small time frames (exactly what we did at Monday), or we can leave initial bounce and look for continuation. There is no other way. Those who still like short side,; use a small stop, because if bounce will come it can be fast and very strong. That not mean trend will be a change, but it will be enough to hurt you.
For tomorrow I will look for selling in the morning and the reversal. Problem is that market has room for exhaustion move and that scenario has fair odds. Every update will be in the room and again I invite all to join us. It is 100% free so you can’t lose anything.
Those of you that used to come into the trading room and stopped, I want to tell you I am back full time and welcome all of you to come again. There is nothing to lose since there is no charge for the service right now. I look forward to seeing you all there.
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