It would be normal to accept a few hundred point loss after the Dow rallied for 889 points today. The close of the market does show some weakness, in that it touched a trendline that has held the market down for the better part of the last month. With no significant movement through the line today, and little evidence the rally is going to continue, the next few days might just kick off a heavy sell off. Read more…
This stock was the perfect bubble. Mastercard represents strong growth in foreign markets, an excitingly strong PEG ratio but is currently running the wrong business. Tight credit markets lower the amount of available credit and the amount that Mastercard users can afford to charge. Read more…
With oil at $62 a barrel at the close of the hurricane season and the winter slowdown, this winter appears like it will be the perfect time to move back into oil. Production cuts from OPEC have done little to stop the fall. Even after the cuts the US is showing huge inventory gains and gas has now reached the lower $2 per gallon region. Read more…
Traders are again pricing in an interest rate cut coming from the Federal Reserve. Apparently a 1.5% interest rate is not low enough, its still 50 basis points from the lowest levels during the Tech bust. The problem is yet again that low interest rates are being used to stoke the flame under the economy, the last time this happened an artificial housing boom was created. Read more…
The Atom processor for Intel is flat out hot. After the MacBook Air set the precedent for smaller computing devices, the industry has been pumping out both small and light computers to meet the demands of consumers. The new laptops are nothing more than for surfing the web or word processing on the go but their low price points and seemingly high powered XP devices are catching on quickly. Read more…
It’s over for any of the big three. The huge sales declines posted recently, Kerkorian’s sell off of Ford stock, and a $25 Billion loan that has done little to prop up stock prices or seemingly influence the balance sheets of any of the automakers. The high cost of union employees, bankrupting pension programs and higher components and gas prices have virtually sealed the deal on any chance of a recovery. Read more…
In volatile market climates like what is being experienced today, there must be a good look at how wall street traders are pricing in the future movements of the indices. In this article I’ll be looking at the ETF DIA which tracks the movement of the Dow Jones Industrial Average.
Taking a look at the options for the Dow will allow us to view what traders perceive about the market. Considering that the opinion of the market plays an important role in how the market will perform going forward, we can extrapolate the numbers and see what traders are planning. Read more…
Above is the RSI for the Monthly Dow chart with the RSI setting on 14. There is something very interesting in what we see here, the RSI reading for the monthly chart has never been this low other than three important dates, 1934, 1974, and now 2008. Read more…
Today’s late rally came as a surprise to some who were invested in the market to watch it drop 500 points only to see a late rebound pare most of the losses. What started as a relatively calm day on the markets quickly became a sad story with the Dow below 8000. Read more…
So much has happened in the market in just three short weeks. The first discussion of what came out to be a failed vote for the Bailout Package. Then a passage with more pork, approximately $150 Billion more and now the Federal Reserve has worked alongside other central banks to drop the interest rates across the globe and further add to the money supply. Read more…
The volatile market today can tell us a lot about where we might go in the future. The entire day of trading was entirely technical, though the one minute tick chart is largely unfilled due to the amount of volatility in the market. To show how the market moved today, we’ll look at the chart patterns and support and resistance as well as the RSI divergence occurring late in the day that all played a factor in today’s trading. Read more…
The Dow has been in freefall since November of 2007 and the decline of the real estate market. Today the Dow is nearing two critical trendlines, some that will offer support if the market makes use of them but will punish the market severely if the market falls through. Until a confirmation of support perhaps even in a bottoming candlestick pattern or a large uptick after a touch of the trend, investing has been reduced to a gamble. A gamble that the market will not enter the stages of further freefall and hit lows it hasn’t seen since the end of the tech bubble. Read more…
The floodgates at the Federal Reserve are now open to the banking industry. With $700 Billion earmarked for the sole purpose of buying up worthless debt, the banking industry and the credit market (at least in the hopes of legislators and Fed chairmen) will turn around to provide liquidity not just to the market but also to average people looking to buy homes, cars or anything else that is traditionally financed debt. Read more…