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Tuesday, February 17, 2009

Breakdown

Today I was looking for a test of 804, and we got it. Within the first few minutes of trading we blew right through it, nad never got back above it. There were 3 tests of 800 from below that I saw, and all 3 were turned back. Even a last half hour rally reversed nastily and we closed at the low of the day. We are now in a new range, between 800 and the low close at 750, which had beeter hold or we are hanging by our fingernails on the edge of a cliff.

Pre-market, the dollar was shooting up again. It had the feel of someone de-leveraging, and it sent the futures lower. A fade-the-gap strategy has normally been employed by traders on days like this, but today it would have been a disaster. The Dow industrials are now sitting on the November low close, and about 50 points above the swing low.

The Nasdaq gapped big and never recovered. However, it did not finish at the low of the day, and did not undercut the previous low. But today's volume is stifling the Kudlow in me, so I'm not brimming with optimism.


Rick Santelli of CNBC said that the world markets are casting their vote for the "stimulus". Perhaps, but there is something else going on here. One thing that scares the crap out of me is waking up one morning, checking the news, and seeing something about another country melting down a la Iceland, except it will be somebody bigger and far more likely to take the world markets down with it.

The Russell 2000 undercut it's previous low and is now in no man's land.


One picture saws a thousand words. XLF, at a new low. Ouch.

I had several stocks on the earnings sheet scheduled to report today both confirmed and unconfirmed, and I haven't been able to find any reports for any of them. I will try to have them for the new highs update. For tomorrow, there is one confirmed, EXAC, and one unconfirmed, CSGP.

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