Online Stock Trading | Stocks Can’t Hang Onto Gains, End Badly

Stocks Can’t Hang Onto Gains, End Badly


Filed Under Market Commentary |

Upbeat news out of the US retailers had stocks poised for a higher open until more credit concerns swooped in.  The rally on Friday now looks more like a short covering rally than any type of accumulation.  Market participants simply do not want to accumulate stocks and are waiting for another moment in time to begin operating on the long side.  This market will need time to repair the most recent downtrend.  I do not see, given the action lately a huge turnaround anytime soon.    I would use any rally, more than a one day rally to start accumulating shares in some ultra-short ETFs.  Otherwise, I would keep a lot of cash on hand and wait out the storm.  There is no need to be a hero in this market.

Some amazing stats from Today’s session:

New Highs:  84
New Lows:  635

% of Stocks over 50dma:  16%
% of Stocks over 200dma:  26%

CBOE Equity Put/Call:  .70
CBOE Total Put/Call:  .97

Pretty amazing stuff, we did see VIX spike higher but did not see an extreme move in the index to signal any type of bottom.  I fully expect the market to move towards the August 16th low, with a weak rally mixed in (possible rally).  In addition to the VIX, the CBOE Put/Call isn’t indicating extreme selling either which then begs the question:  “how low will the market go?”

At this point, no one knows where the market is headed next.  All we know is that many charts are broken, indexes have broken their 200dma and emotional indicators are pointing to more lows.  Do not feel the need to trade to the long side, nor try and chase stocks that are already down!  Do not be a hero, be smart and be patient.

Market Speculator

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Comments

4 Responses to “Stocks Can’t Hang Onto Gains, End Badly”

  1. author_ego on November 27th, 2007 2:05 am

    What ultra-short ETFs most interest you, Kemosabe? You’ve mentioned EFU and SDD before. SKF, DXD, QID?

  2. author_ego on November 27th, 2007 2:06 am

    What ultra-short ETFs most interest you, Kemosabe? You’ve mentioned EFU and SDD before. SKF, DXD, QID?

  3. Market Speculator on November 27th, 2007 7:02 am

    EFU, QID and DXD, SDD too

  4. Monster Stock Trader » Blog Archive » Stocks Can’t Hang Onto Gains, End Badly on November 27th, 2007 10:20 am

    […] (more…) […]

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