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Spin

Okaaay, that lower trendline is history, it didnt hold so we are off lower to test the November 20th lows at the 750 area.
Today the market gapped down (opened lower than the the last trade Friday) to about 801 and after about 10 minutes traded down below the 800 support levels.
Interestingly there was any real panic selling going on, we fell to the 790 area and hung around there all day until Obama came out and signed the 800 billion dollar stimulus package. Thats didnt spark any rally upwards and the market closed at 789.

The next few days will see the 741 area tested on the S&P500, UNLESS, Obama or Geithner can come out with something that can generate a meaningful move upwards, otherwise the trend is down.



The key thing that happened today is that we broke below and closed below 800. Its hard hat time, thats for sure

__________________

Muadib

^ The Dow actually closed at 7,552.60 today... Not good... Long slide coming...

Fasten your safety belts because it's going to be a bumpy ride...

Butterfly

With the free fall of GDP from G7 nations, it's not going to be pretty for the coming months in the Real economy

Markets are going to be miserable, that's usually flat with no upswings. At least when markets are crashing, you can pickup bargains at the bottom and hope for a rebound. But when it's flat, and going nowhere, why bother ?

Spin

Whats next?

Yesterday the S&P500 didnt really know what to do with itself. It found some support at the 783 level but how long that holds is open to debate, theres lots of macro economic data coming out today which is almost sure to be crap.
A move lower would be nice because it presents a buying opportunity of solid companies who will come out of this mess on the other side unscathed.

Spin

BUY 1000 DXO 2x long oil fund at 1.75$

Spin

After an early morning rally the optimism was killed by the incredibly bad Philly manufactirng numbers. SP500 fell throughout the day from 795 to close at 780.
Obama was in Canada chatting shit whilst the two biggest and most insolvent "banks" messrs Citigroup and Bank Of America inched a little bit closer to nationalisation. Citigroup shares, once priced at 50$ can now be had for 2.50$, not many buyers though, bargepole, touch, wouldn't.
The market is sending a clear message to Obama thats says "So far, we think you and Geithner have been shit"
Dark days ahead.

Muadib

Hmm, I wonder if the banks are nationalized, will all the bank employees revert to Government Services pay grades??? Nah, that would be too good to be true...

Spin

Just a quick update on the markets have been doing, below is a chart of todays action so far. The top half is the Dow and this morning it fell below critical support at 7148 fortunatley it pulled above but later tested that level again at 12.10.
The bootom half is the S&%500 index, touching 745 this morning had me sweating as its critical that the 741 level holds. If the market moves through that level, god know where it will stop, possibly near 640-690.

Ben Bernanke has been talking all day live on cnbc and Bloomberg tv, the large move up at lunchtime is the exact moment when he shut up and they took him off the telly

Spin

US futures are now testing the 741 level on the S&P500. This is on the back of news that Citigroup has been bailed out, again, whats this? the third time? fouth time? answers on a postcard please....

Spin

Well, that was what I said on the 18th and today was the day that magic number 741 had its day in the sun. And what a day it was.

Just to recap, the 741 number is important because it was the days low on November 20th. That low was the lowest since something like 1998, certainly lower than the tech crash of 2001-2002 which was 775.

The US markets just closed and here is a simple chart of todays action, now this chart is a cracker, it demonstates perfectly the way the stock exchange behaves technically, you can see that we opened the day below 741 and put in a new low at 735. Then during the morning trading moved higher but 741 was always the centre of attention.
Look at the action just before 13.00, the market came down and touched 741, moved up to 750 and then came back down to test to see if everybody was happy above 741
The last hour was a nightmare falling below and then coming up and testing, getting pushed back, coming up again and moving higher.....then falling below again! Bastard!



So we closed at S&P500 734.95 this is the lowest level since December 1996

This market is clearly heading to the 600 - 650 level, I think we will see a bear market rally to 800 before 650 but the market right now is sending out signal that it is happy to move lower.

Spin

Welcome to 1996!

Good times eh?

Gazzas goal for England against the jocks in the Euro '96



Deion Sanders of the Dallas Cowboys gets inside Willie Williams of the Pittsburgh Steelers, Superbowl 1996


Stocks at 1996 prices!, yes thats right boys an girls. Those super-smart chaps that run wall street have conspired to destroy your wealth but they're not happy with that! They now will take your money to pay themselves so that they continue their egregious lifestyles with impunity!

Its a wonderful world we live in isnt it?

passengers

According to Bloomberg the S&P is at 705.

Spin

^ Hello stranger

The markets just closed in New York, following on from this mornings chart above the selling continued throughout the day and for a moment we fell below the 700 level but came off it to close at 701.17, down 33.92 points for the day or -4.62%
That horizontal white line is a support level at 701, its good that we closed above it, lets see what happens tomorrow.



Heres the bigger picture, clearly showing where things are headed.



The Dow Jones is also a basket case, today it opened just below 7000 for the first time since 1997, however it went on to scrub a total of 300 points off to close at 6763 -300 points, -4.24%.

Jet Gorgon

Even Buffet has made booboos (dam that Conoco investment!). Bladdy economy and the banks are pushing this down now. And Obama's wild spending sprees aren't helping either.

Spin

^ Yep, the market has now realised that he Obama honeymoon is over and that he and his team dont have any better solutions to problems within the financial system.
I admire Buffet for his honesty, he said some interesting things today but his comments regarding the US economy were unwelcome. Guy with his profile should choose their words carefully, his comments today helped move the markets lower and everybody is already taking a spanking.

Jet Gorgon

^ Yep, the doom and gloom scenario-speak is driving me batty! No wonder nobody is spending. And small biz couldn't get credit if they had a suicide bomb packed to their bellies. I hate this "govt will save you" rhetoric. Crikes, ease up on credit and let's get the biz moving again. A friend is using her credit card to buy product and finance her trade show this week. Stinky.

Butterfly

damn, I would have never dreamed to see the DOW at 6,500 again, but I think we are getting there. Things are looking up

10 years worth of growth gone in less than 6 months, make sense !!! as usual, complete overreaction. Overreaction when it went up, and now when it's down.

Thanks god, Obama is there and he is going to save the day

Spin

I have a small wager wih some pals that it will touch 5650. Its a pretty easy bet too because the Dow will go where GE goes, and that sucker is gonna print 3$ soon

Here's a monthly award vid from my fave blogger, The Fly, over at ibankcoin.com

baldrick

so all these traders are sitting watching their charts and deciding on what is good business by saying " that is a floor , bottom , barrier etc ".

I understand from reading " A Mathematician plays the Stock Market" that the majority of investors use emotion to decide on which companies are worth investing in and just because you use due diligence and do the calculations on a companies assets and liabilities and dividends it does not mean the stock will hold its value.

which means the stock market does not obey logic , therefore it is all fcuked up. Maybe this is a teething stage which will remove the gambling and massive gains that have been the norm for many years.

__________________
Knowledge is realizing that the street is one-way, wisdom is looking both directions anyway

"The power of accurate observation is frequently called cynicism by those who don't have it." - George Bernard Shaw

Spin

Yeah basically, the pros use the market levels as one way to help decide buy and sell points. Falling below 741 was a trigger to sell longs and get short. Hitting 701 yesterday and not falling below that was good place to cover that short position and go long. If the market falls below 701 then sell those longs for a small loss and go short and see what happens at the next support levels below which are around 643 area. Less active traders will of course just come in a buy and hold long term, most of these buyers have been scared out of the market at the moment though becuase nobody has any clear idea of how low this thing can go. These days its mostly institutions and day traders that make up most of the markets volume.

Agreed, this is certainly true right now in these extraordinary conditions but less so in more balanced periods. Generally good companies will get noticed and buyers will come in, Buffet made his money finding those companies before everybody else did.