It’s usually a pretty safe bet that we’ll get wild swings after Fed decision but we got a little extra today. An apparently bogus report on GE’s 2009 outlook threw the market into a nose dive in the last 15 minutes of a day. That late selloff turned what was looking like some pretty good follow-through into what looks like failing retracements to trendlines on the Nasdaq and Russell 2000. All three of the charts below look like shorts to me under today’s low.
The small caps made up for lagging yesterday with their outperformance today.
no changes
| Trend | Nasdaq | S&P 500 | Russell 2000 |
|---|---|---|---|
| Long-Term | Down | Down | Down |
| Intermediate | Down | Down | Down |
| Short-term | Lat | Up | 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.
As ugly as the close was, those were the two most bullish days I’ve seen in a long time. They come with a lot of astericks though, like lack of breadth, lack of volume, etc.
Amazing that we are all expecting a recession and a poor 2009 and, yet, an earnings warning from GE can still provide enough surprise to knock things down like that. Perhaps the buyers from Tuesday’s monster rally have particularly weak hands…? Hmmm….
hi mike,iv enjoyed ur posts on risk management,and im wondering why do you recommend such controversial books to newbies? iv looked them up on amazon and saw many books with questionable reviews on their usefullness (such as william o neil,alexander elder,michael covel and alan farley)and iv skimmed thru some of the ebooks myself
Each & every book I’ve recommended is b/c I’ve read it and found it useful. I don’t know what’s so controversial about any of those books. If you’re looking for consensus in Amazon reviews you’ll never find it.
Good point Duru. It’s even worse b/c that wasn’t even a real warning