Posted by 21 February 2008

February 21, 2008 Stock Market Recap

Another day, another opening gap faded. We’re 3-for-3 this week with the market gapping one way and almost immediately reversing direction. This market is a gap-fader’s paradise. Despite what felt like a really bad reaction to the Philly Fed numbers today the indices are still just range-bound. It seems that the market’s reaction to both good and bad news these days is “tell me something I don’t already know”.

T. Boone Pickens was on CNBC this morning calling for oil to retrace about $15 before eventually hitting $150. Based on the chart below I can see the attractiveness of getting short right here — it’s been overbought for a couple of weeks and could easily slip back into its 4 month long range of about 86 to 98. (I’d like CNBC to bring back all the folks who swore we’d NEVER see $100 oil.)

Trend Table

Lots of whipsaws around the 10-day moving averages. For practcal purposes we could really just call the short term trends “lateral” and be done with these daily moves until these ranges break.

Trend Nasdaq S&P 500 Russell 2000
Primary Down Down Down
Intermediate Down Down Down
Short-term Down(-) Lat Down(-)

(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend

*** I’m simply using the indices’ relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.

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Comments

  1. Posted by igorsway on February 21, 2008 at 5:56 pm

    I saw CNBC’s interview with Meredith Whitney today where she claimed financials could fall another 15-50% – that kind of sentiment could really pull down the indexes.

    http://www.cnbc.com/id/15840232?video=659529306&play=1

  2. Posted by Rick on February 21, 2008 at 6:54 pm

    We’re past the 2/3 and 3/4 breakout point. I’m starting to think we won’t see an explosive breakout as the triangle loses its potency. I shudder to think the next 6 months could be like this week though.

  3. Posted by Dr. Duru on February 22, 2008 at 8:36 am

    No such thing as a triple top….? :)

  4. Posted by Michael on February 22, 2008 at 9:25 am

    so says Macke, but I guess Pickens agrees in this case since he’s ultimately calling for $150

  5. Posted by beanieville on February 23, 2008 at 10:00 am

    http://online.barrons.com/article/SB120372725259287195.html?mod=yahoobarrons&ru=yahoo

  6. Posted by Michael on February 24, 2008 at 11:42 am

    Thanks for the link but I don’t jave a Barron’s subscription so I can’t read it.