stock market

No Edge

By TheMoneyMaven ⋅ Email This Post Email This Post ⋅ Post a comment

Right now I’m staring at the charts trying to see if I can find any type of edge going into next week. There isn’t one. The S&P closed at one of the two necklines for this head and shoulders pattern. Last week I said 888 was the neckline but others respectable technicians say it could be 880 depending on how you look at the charts. So right now, I’m sitting in all cash waiting on the next move.

I believe that this week can lay the foundation on how we play out the rest of the summer. The only way I believe that Goldman Sachs (NYSE: GS) earnings on Tuesday morning will move the markets is if they miss, because a huge beat is already priced in. The tell will be Intel (Nasdaq: INTC) (Tues afternoon) then IBM (NYSE: IBM), Google (Nasdaq: GOOG), and the Big Banks (JP Morgan Chase (NYSE: JPM), Bank of America (NYSE: BAC), and Citigroup (NYSE: C) that report on Thursday and Friday. This will let us know how financials and technology stocks will play through the rest of the summer.

The reflation trade I think is dead. There is no inflation in sight and anyone still looking for a rebound in commodities, oil, gold, etc will surely lose money as these prices are in steady free fall just like last year. Short these stocks on any hourly chart bounces.

Trade Ideas
Potash (NYSE:POT) - POT broke down strong on Friday with no let up. I’m looking for this to continue on Monday. Support is around 77/79 area. I am looking to enter Monday morning given the weakness is still there. If it gaps up or starts going higher I will not enter the trade. I am looking for this trade to last no longer than 2 days.

Posted on July 11, 2009
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2 comments for “No Edge”

  1. I want to say that you have become my favorite blog. You break things down so that average investors/Traders like myself can follow along without getting to technical. Tech talk is so boring for hot girls like myself ; )

    I tried following you for awhile on stock idiots, but had to turn that off, cause of that Howierd idiot who just loves his ego way to much, almost as much as his 24/7 bad stockpicks.

    I am so glad I found your site threw google awhile ago, Thank You for all that you do.

    Question, I wonder why you have not spoke of the influence of OPEX on the markets? Any feedback you have on OPEX week would be very much appreciated.

    Keep it up, with love your number 1 fan.

    Steph XO

    Posted by Stephanie | July 12, 2009, 7:48 am

  2. Hey Stephanie - I really appreciate that enjoy my blog. Comments like your is what keeps me on top of posting because sometimes I do get busy doing other stuff.

    My goal is to keep everything in plain English so anyone can understand and I’m glad you can. I am on twitter at http://www.twitter.com/TheMoneyMaven and you can follow me directly to cut out any noise of other traders as well.

    To answer your question, I have 2 reasons. One, I think we are in a time where demand for Oil is slowing so greatly that OPEX comments can not stop it longer term.

    Second, I don’t think OPEX has as much influence on the markets as it use to because there are a lot of retail investors/traders who are using the oil futures and other commodities as trading/investing vehicles through ETF’s. So 20 years ago where the only people buying Oil futures were people who actually intended to use oil. So the only demand was airline companies, oil companies and so forth. Now you have those people competing with an average joe who merely wants speculate in the oil markets and capture profits.

    Well this artificial demand for Oil affects the price greatly and that is why you see wild swings in the prices no matter what the supply is.

    Posted by TheMoneyMaven | July 12, 2009, 11:03 am

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