Wednesday, February 6, 2013

Keystone's Midday Market Action 2/6/13; ECB Decision Hours Ahead

Draghi is picking out his pin-striped suit for tomorrow's main event, you know, the one without the gravy stain on the lapel.  Markets are stumbling along today, marking time since the move in the euro tomorrow is going to dictate market direction, so why not take the afternoon off for a haircut or shopping adventure or perhaps a nap on the cot in the back room behind the storage boxes.  The euro is at 1.3520 a hair under the 200-week MA at 1.3530 so use that as a key level to watch.  Oil remains buoyant after the inventory report.  VIX is fighting at 14.  TRIN is 1.00, how do you like them apples?  Stone-cold dead flat not favoring bulls or bears even by one thin inch.  It is all about Draghi.

Watch the 30-minute chart as described in the previous post. UTIL is 472.64 under the 475.49 the bulls need to rocket markets higher and above the 467.62 the bears need to see the markets collapse. Look at the spank down in USG from the negative divergence highlighted a few days ago. This also hints that all is not well in housing recovery land.  A new Boise IPO hit today for lumber so everyone is going Lady GaGa over lumber today. LL and WY charts were highlighted days ago, same with $LUMBER, all ran too far, set up with negative divergence, anyone buying lumber today will regret it as the days and weeks play out. Whoa, in the last two minutes the TRIN just collapsed from 1.00 to 0.75. Markets should jump higher.

4 comments:

  1. Anyone notice the stupidity going on with NFLX? Not that it matters, but this is a stock with a 562 PE ratio. All of this because of Icahn? They recently struck a deal with Queen Latifah. I'm definitely going to sign up with them now.

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  2. Sometimes momo goes on and on. NFLX daily chart is negative divergence now so it will sell off, but weekly chart wants another high after a short pause. Like platinum now, it is an orgy, now Joe Sixpack is getting bulled up on platinum and running into PPLT and others. As time plays out, it will probably end in tears. If the labor problems at the mines go away, and then the slowdown in autos is confirmed moving forward (less demand for platinum), it will be in trouble.

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  3. KS,

    Would you be a buyer of MHP on this 23% spank-down?

    Also, are you sure you still want to be short BBRY, as that stock is breaking out while all the analysts laugh at the new 10 phone!

    arb

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  4. A drastic drop like MHP, this right away simply says stay away. There are thousands of companies out there, lots of fish in the sea. Drops like that need some time to settle anyways. It may take a wild spike higher but those are all pro's in that one now and they play by different rules.

    On BBRY, the new ticker for RIMM, listed as a potential short on the Positions and Picks page, the pop yesterday only recovered part of the big drop the day before. The big drop was due to the negative divergence on the daily. Note the test at 18-ish, so according to the 80/20 rule, a solid close above 18 will want to lead to 22. Note the gap from November on the weekly at this level, where price was rejected, so watch this gap. Despite any shorter term strength, overall, moving forward it should be sideways to sideways down. Selling interest remains stronger than buyers, the smart money bot last summer and fall with the positive divergence, as we watched here, this is all long in the tooth now, so the funds are likely distributing to Joe Sucka right now getting caught up in the action.

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