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Battle Lines drawn

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Yesterday's lows mark the battle line for Bulls/Bears. The Nasdaq opened around its Tuesday low, but the gap down will probably suck things upwards until the momentum fades and the lows are revisited. TraderMike made a good point about Tuesday's relatively lackluster volume (for a capitulation). If the lows are breached it could get ugly:

Brace for Impact!

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The stage is set for the capitulation: [1] Futures are horrendous [2] The VIX is ready to spike from its consolidation [3] Volume will no doubt be huge Grimace

Three new KIVA loans

Recycling repayments from loans back into the system. This way, membership subscriptions will continue to support new business opportunities long after the initial $25 contribution. If you would like to help, please subscribe to my newsletter and your first month payment (after the 30-day free trial has expired) will be routed to a KIVA project of your choice. The three new loans are as follows: [1] Nansana 7/8 2037 (C) Group : Betty is a widow with five children. She sells fresh food in the market. She wants to pay school fees for the children and buy food with the business profits. [2] Leonarda Laura Sulca's Group : Leonarda, Petronila, and Ana Maria have been members of the community bank Arco Iris for 6, 3, and 5 years respectively. In their community bank they have learned to be punctual and responsible, to save, to run their business, to avoid getting sick, and to respect other people. Leonarda is 36 years old. She is married and has three children, who are 13, 10, and 8. Sh

Stockcharts.com Weekly review

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The selling didn't take a break - how much more is there left in the tank? This is what the Stockcharters had to say about it? Joe Reed has called an official Bear Market for the Nikkei, will US markets follow? His additional comments: THE POSITIVE: ***The Word of the day (and possibly for the year) is 'UNCERTAINTY'. But believe it or not there are TWO POSITIVES to keep in mind... *The Republicans do not want a RECESSION before the Election and they will do everything in their power to prevent it. This MIGHT be enough to keep the market afloat for a while, POSSIBLY. Also, an Inverted Yield Curve PRECEEDS most recessions which has not happened yet. 1-18-08 *THERE IT IS, I KNEW IT. (per the above) Today Pres Bush came out with an Economic Stimulation Package to hopefully ward off recession. A $145 Billion in tax relief so people will have more money to spend. (As you know spending injects the economy and is anti-recessionary). The way I see it there are 2 big 'IFs' a

Dear Market, Please can I have a bottom for (by) Christmas?

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No mistaking who was in control yesterday. Now that the markets have August lows out of the way will bears run out of steam? Two internals showing deep oversold territory are the Percentage of Stocks above their 50 and 200-day MAs. For the S&P, the Percentage of Stocks above their 50-day MA sits only 3 points away from its August low of 7.6%. During the cyclical bull market this indicator rarely dropped below 20% - so there is a fundamental shift in this indicator's dynamic. The Nasdaq carries higher relative strength versus the S&P with the Percentage of Stocks above their 50-day MA in the 20s. The 19.75% of stocks above their 50-day MA compares favorably with the August low of 20.93%, but still a shade above the false bottom at 18.84%. However, this metric has lingered around 20% for the past few days as the parent index toppled - an indication that the selling is done. Unlike the comparable S&P measure, the Percentage of Nasdaq Stocks above the 50-day MA has seen a c

Welcome "Market Bottom"(ers!)

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For the first time in this blogs history, every third or so visit has come from a search for "Market Bottom" or variation thereof. Ranking first on the search is great too - ahead of Big Picture , Forbes (old 2001 story) and CNBC's Jim Cramer - that won't happen too often Trade my Stock Picks at

Buy or Sell?

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In my newsletter you will see an overall 'Market Health' rating for the current month which is either Bullish/Buy or Bearish/Sell. I base this rating on the state of the market internals (Bullish percents, % stocks above key moving averages, and the Summation Index) and the relative position of the markets with respect to support and resistance on yearly charts. The chart below shows my respective calls since January 2006 for each of the months that followed: It has been a mixed bag with a nice call on 2006 lows, but a missed opportunity on the early 2007 rally. I have remained bullish for December and January as I believe the market is offering discount opportunities for the next rally, particulary in Blue Chip stocks (with Energy perhaps the only sector somewhat overvalued). Looking back at the Nasdaq over the last 10 years there are some interesting observations to be made: The longest losing strength for the Nasdaq was a 6 month period in 2002, which led to the absolute lo

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