Looking back at my 18th May post...On size of correction...
<<Market new highs are associated with new basing periods,we have this huge bull
run over a period of five years with significant corrections on the way up. Thus in
my opinion a run from 990 to 1378 is a run which is little suspect on correction
front, remember that move to 1310 area, that is kind of move which gives now
lease of life to the market, we have not really got some terribly good correction, for
the health of this market we need one, and in wake of corporate sector earnings and
banking turnaround with Transportation and health the only way to get it is through
new fear of core inflation with an added element of Fed tightening, a full quarter
basing between 1230 and 1364 may set the market very well for a summer rally,
AG in terms of timing would like the summer rally to take off from 1180 or 1230
and not from 1378.. >>
On Fed tightening .. I was wrong on the .25 increase but right on the content..why summer rally will come from lows...
<<AG can take back .25 of the
.75 he gave the markets on back of global meltdown, he would initially send a
strong signal but in wake of strong earnings and looking at the various sectors I
would think that this is a possible scenario, I have catered for this outside chance by
buying some 1230's towards close of the session, just a gamble.. In my scenario
building process I do go sometime wildly off the 'tangent' and right now here I have
this opinion my trade would be contrary to conventional pundits.>>
<<Market new highs are associated with new basing periods,we have this huge bull
run over a period of five years with significant corrections on the way up. Thus in
my opinion a run from 990 to 1378 is a run which is little suspect on correction
front, remember that move to 1310 area, that is kind of move which gives now
lease of life to the market, we have not really got some terribly good correction, for
the health of this market we need one, and in wake of corporate sector earnings and
banking turnaround with Transportation and health the only way to get it is through
new fear of core inflation with an added element of Fed tightening, a full quarter
basing between 1230 and 1364 may set the market very well for a summer rally,
AG in terms of timing would like the summer rally to take off from 1180 or 1230
and not from 1378.. >>
On break of 1328 and 1322 and strategies.. I projected the following strategy, long I may write but catching market by neck has become exclusive of Idea, if it goes it cannot without we flashing it out if it goes down it will not be without us.. that is what trading is all about..
<<<<i would sell on highs like 1360 area and buy around 1328 to short
again below 1322 for a test of 1292 in near future. For this test 888 on BKX and
2500
on Comp will be decisively taken out, I can see that these worries can take market
to
as low as 1980 on NDX, so for us as day trader we have to have this cautious
stance
and nimble approach to trade the volatility we will see as I have said before a
pattern like
890-990 band and I would like to trade this band from lows to highs... >
Trading bounces forecasted..
<< have a case here for today and I would like to work on it, for me market will dip
and waver until announcement is made, if they leave it unchanged I will not be
surprised to see some selling even after initial buying, I would still think 1355 is the
top of the move....a break of 2555 will lead us higher to upper band of 1255-60
area but we will see some selling at that resistance.. On down side 1318 and 1310
represent trading rebounds whereas 1364 break represents change of mentality.
SOX 402 break is a good move and just symbolizes the sentiment we highlighted
Tech's will out perform in a strong economy..>>
I will like to see SOX holding 392 today I will also like that Comp may trade above 2506 so as to close above the 50 days MA and SPM around 1318 in absence of all these breaks I would think we may test the lower limits of 1292 if all indexes and high fliers stay below their 50 days mA. We can than go even to if double close materialises below the levels yesterday to 1260 and 1230 area but let us wait for SPM 1292 break and 550 break DOT and BKX 835.
I will than set a target of NDX and Comp below 1980 and 2360 area, I still think that a break above 315 on IIX and 618 on DOT will be first indicator of a move in internets otherwise wait, I have been hot on Techs but waitng for a level when we were at 640 I said above 652 when we were at 618 I called for above 632 entry, this is the only way to save from whipsaw, untimely entry is the worst pain, you see your premiums are lost and you see that you are unable to pick at bottom. Right now I have reduce my entry to 595 the new resistance.
I have learnt it hard way never enter position during the session, wait for your resistance and support to be taken out, you will always find that with techniques I use you will be shade better in investing. You will have puts when you need them most and you will enter with minimum of premium loss. I am keeping ATHM CMGI AOL EGRP SCH AMZN on my radar alongwith other highfliers until market show me the direction, above my resistance of IIX and DOT the supports now become a resitance if we have a second close and if we have one today we will possibly see a lot more selling .
I will wait and at a certain point I will enter big. Right now enjoying my shorts of BKX and long of bonds, you don't get a better combo than this.. On downgrade of BKX on basis of Y2K problems this is crap but I have learnt one thing it is better some time to listen to crap when environment is changing to pro crap talks.. Right now for next few days until 2506 on Comp and 2115 on NDX is outwe are in volatile times, 1318 is now a resistance on SPM.. Best regards ..
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