Month: October 2004

Three-Year Cup With Handle

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Here’s that 3-year chart of the Cubes (Amex: QQQ) I was talking about the other day. Doesn’t mean anything until/unless we breakout of the 9-month handle. It is positive that volume has picked up on the recent rally. We’ll see what next week brings… A relief rally, especially if we know the winner of the election by Wednesday morning?? We’ll know soon. Cheers!

On Taking Action

Grand business plans are well and good, but nothing beats dipping your toe in the water.
-Probably said by most successful entrepreneurs

Crude

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That’s the word of the day. This morning the weekly inventory report came out showing that the amount of oil in storage tanks increased for the fifth consecutive week, rising to its highest levels since before Hurricane Ivan tore through the Gulf of Mexico. What does it mean? Well today it meant push the sell button for the oil futures and the buy button for equities. Oil had its biggest one-day loss (5%) since June 2 and closed at a 2-week low. And as shown in the chart above, the Cubes (Amex: QQQ) surged $0.91 on a 57% increase in volume. In fact…

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Walking the Line

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The Cubes (Amex: QQQ) are again trying to muster the troops at the 50-day EMA line. This shows up clearly in today’s hammer-type candle that touched the line and then rallied into the close on decent volume. A more pronounced volume pickup was experienced across the Nasdaq and NYSE, both of which logged respectable advances, especially when you consider that the Presidential election is a week away and most people are just holding their breath until we see how it goes. Conventional wisdom is calling for a relief rally after the election, which would be my call as well, but the chorus singing in unison raises some doubt, as does the weak dollar and high energy prices. We’ll see. Cheers!

Greenspan Virtual Q&A

Here’s a brief and incomplete reaction to Alan Greenspan’s most recent comments on the housing market and the question of if there is a bubble and if there is a housing bubble. The Greenspan quotes and paraphrases are cut out of today’s WSJ article by Joseph Rebello (complete article included below):

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Greenspan Virtual Q&A

Here’s a brief and incomplete reaction to Alan Greenspan’s most recent comments on the housing market and the question of if there is a bubble and if there is a housing bubble. The Greenspan quotes and paraphrases are cut out of today’s WSJ article by Joseph Rebello (complete article included below):

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Another Distribution Day

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Hasn’t been much to report since my last posting about the reversal day last week and the island reversal the prior week. But all that changed after yesterday’s and this morning’s action…

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Working on an Intraday Reversal

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12:20 PM: Just have time for a quick intraday posting, which for now is somewhat of a rare occurrence for me, but I did want to point out this possible reversal since it comes on the heals of: (1) an island reversal (see 10/11/04 post), (2) yesterday’s test of the 200-day moving average and upside reversal for oil and stocks, and (3) this morning gap up opening after bellwethers Yahoo (Nasdaq: YHOO) and Intel (Nasdaq: INTC)reported their earnings. So…

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On Learning From Mistakes

I learned more from the one restaurant that didn’t work than from all the ones that were successes.
-Wolfgang Puck
(This is his version of the “learning from mistakes” concept, which of prime importance in the markets.)

Island Reversal

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As a follow up to my 10/4/04 “Warning Flags” post, here’s what happened: The warning flags were accurate. The Cubes (Amex: QQQ) consolidated for a couple of days, which was actually constructive after a four-day sprint, but…

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Terrorism and Nationalism

This short and interesting editorial came out after the recent Russian hostage crisis in Chechnya (think hundreds of dead schoolchildren). The author, William Pfaff, makes some interesting points that I have yet to see analyzed — or even referred to — in the popular press, let alone by any politicians. Pfaff offers no solutions, and he goes off on a tangent in the last three paragraphs, but his ideas linking nationalism and terrorism are interesting and may be useful, at least as another lens to look through as we try to understand what is happening and why, which is the only way we will ever find a real solution. The editorial was printed in the September 4-5 issue of the International Harold Tribune and can be download here: Download Terrorism_Is_a_Tool_of_Greater_Danger_9-4-04_Intl_Harlod_Tribune.pdf.

Warning Flags

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Just time for a quick posting to highlight a few little warning flags that you might not notice if all you looked at was the fact that we closed up again today on increased volume. What’s different is that we closed well off the intraday highs, below the open, and close to the lows of the day on above average volume (see circled candle on the price chart). Also, looking at the oscillator at the bottom of the chart, you can see the fast stochastic line crossed below the slow like from an overbought area (see circled area). One other point of interest not shown on the chart is the fact that the volatility indexes, notably the VIX, marked their lowest levels in a long time on Friday, a sign of complacency. None of this means the rally is over, only that we’ve got a couple of warning flags and some resistance at today’s high. We’ll see how it goes. Cheers!

Was It All Just a Dream

It may take until the next multi-year, multi-point rise in interest rates or the next recession, but sooner or later all those 0% down, interest-only, 40-year adjustable-rate mortgages are going to come home to roost and it’s going to be a rude awakening for all those dreamers who think real estate prices can only go up. What will become abundantly clear in hindsight is the fact that…

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Survey Says: It Was a Shakeout

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When we last looked at the market (see 9/24/04 posting), the question was posed: Shake out or breakdown? The Cubes (Amex: QQQ) had just reversed off of a failed test/breakout above the 200-day moving average (circled on the chart) and immediately dove for the 50-day moving average, in the process undercutting short-term moving averages and the prior week’s lows. That action no doubt…

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