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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Jacob Snyder who wrote (54852)	12/9/2011 11:54:58 PM
From: Sam	4 Recommendations Respond to of 95420

ECRI: Give Us a Year, and You’ll See If We’re Right on Our Recession Call By Mark Gongloff blogs.wsj.com ECRI weekly leading index, rolling growth rate. Click for big image. The Economic Cycle Research Institute’s weekly leading index has improved a good bit from October, although the improvement has stalled recently. The latest reading on the index came in at 122.5, the highest since early September. The rolling growth rate, which smooths out weekly fluctuations, rose a bit to -7.6 from -7.8 last week, but that’s still lower than the 7.4 of a couple of weeks ago. So what, you might be asking? Tough to tell, exactly. This index is not the one the ECRI used when it made its famous recession call a couple of months ago — they relied on a longer-term leading indicator, which they only show to paying clients. What’s more, the rolling growth rate on this index doesn’t look like it fared any worse this year than it did last year, when the economy did not fall into recession (though you could argue it came awfully close in the first half of this year). In an interview with Tom Keene on Bloomberg TV yesterday, Lakshman Achuthan of the ECRI said the two dips were different. “The downturn we have now is very different than the downturn in 2010, which did not persist,” Achuthan said. “This one is persisting.”ECRI: Give Us a Year, and You’ll See If We’re Right on Our Recession Call It’s frankly really difficult to see any difference at all between this dip and last year’s dip in the longer-term chart of the WLI, which Barry Ritholtz posted today, via Jim Bianco. But Achuthan is sticking by his recession call. And to his credit, he has put a freshness date on his prediction: “If there’s no recession in Q4 or in the first half I’d say of 2012, then we’re wrong,” he told Keene. “You’re not going to know whether or not we’re wrong until a year from now.”

To: Jacob Snyder who wrote (54852)	12/11/2011 2:47:50 PM
From: Return to Sender	2 Recommendations Read Replies (1) \| Respond to of 95420

We have a symmetrical triangle on the S&P 500. These patterns usually resolve in the direction of the previous trend. That said it can be dangerous trying to guess in advance which way a symmetrical triangle will break. If we go lower, as you and to be honest I also believe we are headed, all your short positions will end up being profitable. In fact they could be extremely profitable. But what if we are wrong? Would it not have been smarter to at least book some profits on that KLIC short and reshort again at what are now higher levels? S&P 500 Monthly Chart: More on symmetrical triangles: stockcharts.com While there are instances when symmetrical triangles mark important trend reversals, they more often mark a continuation of the current trend. Regardless of the nature of the pattern, continuation or reversal, the direction of the next major move can only be determined after a valid breakout. We will examine each part of the symmetrical triangle individually, and then provide an example with Conseco. Trend: In order to qualify as a continuation pattern, an established trend should exist. The trend should be at least a few months old and the symmetrical triangle marks a consolidation period before continuing after the breakout. Four (4) Points: At least 2 points are required to form a trend line and 2 trend lines are required to form a symmetrical triangle. Therefore, a minimum of 4 points are required to begin considering a formation as a symmetrical triangle. The second high (2) should be lower than the first (1) and the upper line should slope down. The second low (2) should be higher than the first (1) and the lower line should slope up. Ideally, the pattern will form with 6 points (3 on each side) before a breakout occurs. Volume: As the symmetrical triangle extends and the trading range contracts, volume should start to diminish. This refers to the quiet before the storm, or the tightening consolidation before the breakout. Duration: The symmetrical triangle can extend for a few weeks or many months. If the pattern is less than 3 weeks, it is usually considered a pennant. Typically, the time duration is about 3 months. Breakout Time Frame: The ideal breakout point occurs 1/2 to 3/4 of the way through the pattern's development or time-span. The time-span of the pattern can be measured from the apex (convergence of upper and lower lines) back to the beginning of the lower trend line (base). A break before the 1/2 way point might be premature and a break too close to the apex may be insignificant. After all, as the apex approaches, a breakout must occur sometime. Breakout Direction: The future direction of the breakout can only be determined after the break has occurred. Sound obvious enough, but attempting to guess the direction of the breakout can be dangerous. Even though a continuation pattern is supposed to breakout in the direction of the long-term trend, this is not always the case. Breakout Confirmation: For a break to be considered valid, it should be on a closing basis. Some traders apply a price (3% break) or time (sustained for 3 days) filter to confirm validity. The breakout should occur with an expansion in volume, especially on upside breakouts. Return to Apex: After the breakout (up or down), the apex can turn into future support or resistance. The price sometimes returns to the apex or a support/resistance level around the breakout before resuming in the direction of the breakout. Price Target: There are two methods to estimate the extent of the move after the breakout. First, the widest distance of the symmetrical triangle can be measured and applied to the breakout point. Second, a trend line can be drawn parallel to the pattern's trend line that slopes (up or down) in the direction of the break. The extension of this line will mark a potential breakout target. Edwards and Magee suggest that roughly 75% of symmetrical triangles are continuation patterns and the rest mark reversals. The reversal patterns can be especially difficult to analyze and often have false breakouts. Even so, we should not anticipate the direction of the breakout, but rather wait for it to happen. Further analysis should be applied to the breakout by looking for gaps, accelerated price movements, and volume for confirmation. Confirmation is especially important for upside breakouts.