Wang’s Happy Trading

I had to step away for a meeting 1 hour before the close today. The market was doing a little better just then. But, I made one last comment before I left:
HappyTrading
Posted January 17, 2008 at 11:55 am | Permalink (Edit)
I don’t trust any rally right now, unless there’s external catalyst that changes the sentiment on the market.

During that last hour, the Dow lost more than 100 points!! Yikes!!

The market started the day being “UP”, a little bit of “relief buying” (I can’t even call it a rally). It pretty much slid rest of the way today. The Dow closed down almost 307 points; SPX was down almost 40 points; Nasdaq fell 47.69 points!

Here’s how the market looked at the close:

VIX jumped +16.74%!! BTK (biotechs) hung on to a +0.17% gain. The rest of the market was very red. OIH (oil services) continued to get dumped, losing another 4%. XME (metals and mining) faired worse, falling 5.67%! MOO (agriculture) was too rich from the jump last week, in this type of market environment, and, people cashed out; it lost 7.23%. PBW also fell 5.09%.

SPX

SPX lost almost 40 points to close at 1333.25. It is just 13 points away from its next support level (1320). The MACD is starting to get big, which “normally” signals overly done in which ever direction that it is going.

Nasdaq

Nasdaq tumbled 47.69 points to close at 2346.90, just below the support at 2350.

The market sentiment is so bad that these indices are blowing through one support after another. Each day, it almost seems like they drop from one support level to the next. They seem to be falling as much as they can each day, perhaps because there’s nothing to change the market’s mood!! Also, these “technical” support levels are reference points; and, now, we have to go back 12-18 months to find them. The further we go back to find these support levels, the weaker they likely will be. There needs to be something big and external to change the sentiment. Until that happens, I’m staying mostly in cash.

Today, MER reported the worst quarter in its history, sending its stock down more than 10%, in addition to sending another round of fear on the market! GOOG today came down all the way to under $600, making the day low at $598.01. It closed at $600.79. BIDU just could not find any stops. It fell almost $30 to close at $264.99 (from a high of $429.19 set in early November 2007)! CME, a recent $700 stock, traded at $544.73 today, down $32. Ok, you get the drift…stocks are getting cheaper and cheaper. But, like I said, I’m going to wait for the market sentiment to change. Let’s end this post on a positive note. After the market, IBM posted strong earngings, backing up their preliminary results from earlier this week, and raised their outlook for 2008. Its shares were trading almost +5% higher in AH.

Good night and HappyTrading! ™