Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Minyanville's T3 Morning Market Call: What Does the End of Summer Mean for the Market?


Equity markets are far from dead and it can reward on any time frame as long as you have an approach

The Minyanville - T3Live Morning Market Call is brought to you by is an online financial media network and education platform that provides active traders and investors with market analysis, real-time access to strategies, and in-depth training from real traders, real-time©. Learn more.

As we enter September, we have a lot of key events to pay attention to. Markets always have something to obsess about, and this week it will be Thursday's ECB statements, and then the jobs report Friday. Last week it was Jackson Hole and it's already forgotten. All the headlines this morning talk about growth slowing around the World (the fundamental thesis of 2012) and all the potential calamity that could come with it. Meanwhile, the S&P 500 is up almost 12% and the Nasdaq up 15+% (the 2012 technical thesis).

Markets have been enjoying a stealth bull run since the October 4 outside day about 11 months ago. Markets re-energized after a healthy correction that held above the 50% Fibonacci retracement (1266) level that marked a more recent low on June 4 (a buyable dip). Since then, the indices have been following a pretty maneuverable channel that still remains intact. There has been multiple opportunities for the bulls and the bears to create cash flow. Stock pickers also have received some fruits for their labors as many stocks hit highs this summer, including some historic ones.

Technically, short term, there are two patterns that will likely resolve soon. After an Impressive move since the June 4 lows and lots of action in mid-August, we had an outside day on August 21 where the S&P pushed through the highs of the year and failed to hold them, creating a defined resistance area to trade against 1422-1426. Since then, the action has been quiet but decent as we've built a floor above the 1395-1398 area. We can continue to trade within a range, that is why you need to learn how to trade the markets.

Bears tried to break the 1395-1398 area the day before Jackson Hole and the day of, but it held firm. Until they get a decisive break and close below this area, the bulls will remain in control and the higher the probability we take out resistance. A close above 1422-1426 will create another squeeze and some performance chasing as most professional are likely under-invested and might have a problem explaining why come year end. I'm in the camp that we can see 1450-1470 at some point by years end.

A close below the upper floor 1395-1398 will get short-term market participants flat to perhaps net short for trading, (including me), but in order to truly change and break the ascending channel uptrend that's been intact since June 4, we would need to break 1372-1377. This area also contains the 50-day moving average. That is the true "line in the sand", a close below this level can produce a true complexion change.

Now let's go over what been going on in tech.

Apple (AAPL) had multiple buy prices since the earnings miss creating almost an almost 70-80 point run. It gapped up on the Samsung verdict on 8/27. That date produced a "sellable event" as it's corrected about 25 points off the highs. On Friday it created a new pivot to trade against for the short term trader. Micro support is $662 then Friday's low of $657. Micro resistance stands at $668-$672. We will have the unveiling of the new product line soon. We'll talk about that as we move closer. You need to have plan for how to trade Apple over the long and short term.
< Previous
No positions in stocks mentioned.
Featured Videos