A few tidbits from the chart:
1) Draw a line connecting the highs of 75 7/16 on 2/24 and 54.625 on 4/7. That's an average drop of 0.718 per day (29 sessions), and we are in the neighborhood of a third touch every day. Today's value (10 sessions after 4/7) was 47.45, tomorrow is 46.73, Thursday is 46.01, Friday is 45.30. There's a little wiggle room here, but not much. Note that both of the points were the result of a very deliberate and measured run, as I mentioned at the time.
2) 200-DMA is 46.33 or so (just eyeballing) and isn't changing much day-to-day. We broke below it Monday and have spent the week below it. We actually touched it once or twice since. I'm calling that a break and a re-test. We'd need to spend a day above it for me to begin to think we're going up rather than down at this point.
3) 20-DMA is about 47.25 today (eyeballing again) and dropping about 1/2 point a day. DMA's crossing each other is always good for a lot of laughs -- the 20 and 50 crossed on March 8 at 62 or so and we broke 50 within five sessions.
So we have lots of things falling into place chart-wise. Never mind earnings from MSFT, CPQ, IBM, et al, but they are very conveniently available as an excuse/scapegoat for what this chart action portends. Wednesday-into-Thursday looks like the day for a fake spike to 46 and change and then WHAMMO! by Friday.
IMO, of course. First touch of (1) gets me short via May 45 puts. As always, my predictions, when expressed as market bets, are always covered by the CBOE, so after-the-fact jeering is superfluous and will be ignored.
(Noted futures trader Dan Akroyd offers an observation:
ftp://ftp.con.wesleyan.edu/pub/sounds/movies/tradingplaces/tradpl23.wav ) |
