Thanks, John. As for me, my analysis is obviously modified a bit from my #1 post:
I called for a Monday rally and got it. However, I didn't foresee the dip that preceded it most of the day. It was clearly a day for leaders, who emerged from the dip unshaken and some were up a little. I was taken aback by how far we dipped; since we broke the April 14th low, I'm modifying my bottom targets near term.
(Full Disclosure: This time, I played my gut against the early morning evidence of a meltdown, and the meltdown won. I had my worst day on the market this year... and in fact, ever. As a point of clarification, I don't call myself a daytrader, but a swing trader who times the market. I keep a relatively small-range portfolio with substantial holdings in each selection; as the portfolio has grown, it makes fast sells difficult and Monday morning's sharp plummet nailed me good. This, I assure you, keeps me humble, despite an overall record some consider to be excellent. Simply put, I goofed.)
Because of the hoped-for WTO treaty passage Wednesday, I expect China plays will remain strong part of Tuesday, though if the votes aren't there, early leakage of that fact would immediately send the market into a dive.
SINA has run up in expectation; at about 55, I'm calling a top at 60. Likewise, CHINA, at about 28, has a top of 30. I'm not sure XING can go higher. Among the better % increases you might find Tuesday, look for:
IASIA, at 9, with a potential high of 10.5 (16%)
CHL, at 124, with a potential of 150 (not a great trader; it rarely runs but just jumps).
ASIA, at 41.5, with a potential high of 50. (20%)
SETO, at 1.6, with a potential of 2 (25%)
GRIC, at 9.5, with a potential high of 12.5 (31%)
DDDC, at 7.4, with a potential of 10 (33%)
CBQI, at 2, target unknown and a questionable play.
This is not an exhaustive list; it's just highlighting a few I like. Under a less subdued market mood, all targets would be much higher.
Other indicators are not good. Since there's few earnings ahead and none Friday through Tuesday, there is nothing to sustain upward momentum on Wednesday or Thursday or Friday, so I expect they'll be brutal. Moreso if the WTO vote fails.
So where is the bottom? On Friday, you'll see the bottom for the year 2000. My worst case scenario says it may dip during the day to as low as 2736-2750 with a close at 2800. My moderate scenario, which I still hope for, finds a bounce at 2900 and a close at 3000.
I make it an absolute warning here: Wednesday through Friday is not a time to be on the market at all, period.
DID YOU HEAR ME???!!!!???? I don't care who wishes to slam me for this analysis; if I'm wrong, the three days I'm off the market, missing gains, won't faze me a bit. Of course, it will be heavenly for shortists, but homey don't play that game.
Any rally Tuesday is a fake. It won't be sustained all day even. Sometime betweeen open and 2 pm, I intend to close all my positions and take the week off.
In the next 3 weeks, we'll revisit the low once or twice, but it will hold. I expect now the "All Clear" signal will now come by the close of June 16, two days after the next Beige Book release by the Fed....
Here's the other indicators to watch, to know we've hit bottom:
--MSFT high of the year is 120; it needs to dip below 60 (at 64-1/16 now)
--AOL dips below 48; also 50% off high of the past yr. (at 52-3/8 now)
-- CSCO dips below 48; or 40% off its high. (at 55-1/4 now)
That's my opinion; please be careful. |
