US market commentary

Market commentary for 02/13/2007

Good day!
There is something to the song that says you know when to hold em and when to fold em. Yesterday as expected was one of those days. After the strong move on Friday it is normal to see a high risk consolidation day. On the 15 min charts, you can see that every new 5 min selling wave was slower and slower with weaker pace. That is sign that the market need a longer correction on the 30/60 min chart. A lower risk probability will not happen until we see another day or two of consolidation. That means we can expect a higher risk market today. I expect a bounce in the morning. It will be nothing as strong as Fridays move down but more as a correction from yesterdays low. If that is the case then we can use that possibility to enter long day trades.
The 200sma is always a stronger support area on any time frame. The DIA and the SPY are at 200sma on the 60 min chart. Usually on the first try at that support area it will hold and we can see bounce. That is the possibility which I will look for this morning. Right now, we can't expect any longer bounce that can be used for faster intraday moves. There is a difference is with “own way” stock, like traps, gaps etc.
For the longer term, my bias is on the short side as I look for a daily/weekly correction. In the case we see weak open or a gap down which is always a possibility during earning season it will be to early to have a low risk short setup.
During consolidation days important is to not trade with same risk as when we have trend, so please keep that in mind.
Good luck trading today!!!!

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The markets seem to be in pivotal pressure condition today,

I will watch (mer) and few other leading stocks, a breach of either the high or the low of yesterdays range
can decide the trend of the next few days in the SP500

Market commentary for 02/14/2007

Good day!
History does repeat. Just look at the market and that is what we got. After Friday’s strong move down and Monday’s consolidation yesterday we saw a reversal. Today started with a gap up and we saw exactly the action that I expected during the morning. Unfortunately, the rest of the day I was on the wrong side of market. The major reason was I didn't expect the morning continuation. The QQQQ was the weakest index while the SPY and the DIA made nice recovery and back again above daily 20sma area. The DIA daily channel support line held again and we are back in the middle of daily range. Since Friday’s selling was strong, I will not expect the DIA or the SPY will see new daily highs anytime soon. Especially since the QQQQ still remains under the daily 10/20/50sma resistance areas. But that action could bring divergence which is the same as we had yesterday. Until the QQQQ or technology sees some strength we can continue to see the SPY and DIA outperform the QQQQ.
This is the reason I expect high risk, whippy trading action today and until the market decides what direction it will take I will trade with small risk and number of my trades will be less than usual.
I don’t have strong bias for the morning, earning news can gap the market in the morning, and I think that market can flip around without revealing its daily direction. I will wait to see market does at the open and monitor its breath and then I will go with the market action. Risk for swing traders will remain high and it is best is to start will a small position and then add if trade improves.
Good luck trading today!!!!

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Market commentary for 02/15/2007

Good day!
From a short term bearish bias to a short term bullish bias in few days. That pretty much explains the market action this week. The FED chairman says things are ok and that gives everyone the ok to buy. Don't you wish it was that easy?? After the gap up in the morning we saw a continued strong move up the rest of the day. The previous daily high and range area stopped yesterdays QQQQ action. The DIA again stopped at daily channel resistance while the SPY made new weekly high. All these reasons are telling us that we can be more on the bullish side right now. We still don't have a low risk swing setup pattern I will stay in the same mode about risk. Looking at the 60 min charts I will like to see consolidations first and then possible continuations. That is what why I will wait for a longer time. On the 60 min charts we saw two buying waves and we still have room for another move up. This without rest will increase risk because of past action. In the morning I will wait to see the market action and I will follow it. This is the same as I have done the last several weeks.
Individual names we have traded are going well for now in both directions. Risk for swing traders remain higher and I will stick with intraday moves. Longer term the Indices can break up from weekly consolidations and the action today can help us to achieve that. Best is to stay with strongest names for long side and weakest names for short side which is exactly what I do all the time.
I will go over the gainers lists to see if there will be some traps and bigger gaps for intraday action.
Good luck trading today!!!!

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Gee... I listened to him and I didn't hear him say anything about whether I should buy or sell. Do you subscribe to his for-pay newsletter?

Well, I don't know how you understand Ben Bemanke speech, but when he talks about easing inflation for me that is good sign for bulls and in my opinion we saw that reaction. Maybe I understand something wrong, who know, but still think that his speech helped market to staying strong.

Ivica

Bernanke learnt his lesson when he first came into the job...an off cuff quip to a journalist got out & the markets tanked....highly embarrassing.

Now he chooses his wording very VERY carefully ....& now splurts out typical FED speak, ie don't say too much new (& if you do counteract it with a "however if..."), change the odd word here & there, let the markets react how they want to react, but don't, repeat DON'T be the one who was so clear & lucid with his statement that any major market reaction can be attributed to what you said!

We're talking about central bankers after all!

My apologies if someone understand wrong. I'm not lucid one, or smartest trader. In my commentary, I just told how market reacted and I'm just trader who follows market action. However, definitely we can say that market liked his speech, no matter how we understand it, reaction is up and that is what I follow. I'm TA trader and charts are my tools, but again, my opinion is that market like his speech and market reacted with strong intraday move up. Definitely, I'm not reason for that reaction. Here I just try to bring my expectations for the market possibilities for the next day and near future from charts view, nothing else.
Regards
Ivica