Buzz Bits: Dow and Nasdaq End Lower
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Oil of Oy Vey! - Todd Harrison - 2:35 p.m.
I've gotta scoot across town for (yet another) biggie meld but before I do, some quickie vibes on today's fray:
- The action in the financials (Goldman (GS), Merrill (MER), Morgan Stanley (MS), JPMorgan (JPM), Citigroup (C)) implies that absent news, the tape will hang tough today.
The persistent 3:1 negative breadth is why I wouldn't buy 'em for a trade.
A high quack count (when the ducks, or tells, align) is necessary for an advantageous risk/reward (I'm talking tape, not specific situation). When it's not there, don't force it--the ability not to trade is as important as trading ability.
I've been dabblin in drillers puts the last few days, IN-N-OUT like my favorite burger joint. I'm currently "not involved" but that's been my M.O. into the face of crude's rude tude.
It's prices like these that make me glad I sold Sarah, my sweetheart of an M5, last spring. A car in the city is nice but between $400/month on a garage and a like amount each time I filled up, the risk/reward didn't justify "nice."
OK, OK, OK, President Fish, I'm coming. Yeesh! With a partner (and best friend) like that, who needs a Honeydew marriage?
Fare ye well, my friends, and enjoy the journey.
IWM to Test Support - Michael Paulenoff - 1:56 p.m.
Thus far, the iShares Russell 2000 Small-Cap ETF (IWM) has retraced 62% of its prior upmove from 68.16 to 72.27.
Although the intensity of the sell-off is pressing the hourly RSI into oversold territory, my sense from the way the pattern is unfolding is that the IWM will test the March-April support line, now in the vicinity of 69.40/35 -- prior to my expectation of a potent upside pivot reversal that initiates a new upleg.
Click to enlarge
Tech Thoughts - 1:28 p.m.
Stifel is getting the Blue Coats (BCSI) running today -- upgrading the stock as it likes the deal with Packeteer (PKTR). I had buzzed that I thought the deal price was still a good value for BCSI.
Strategically, BCSI is doing what I thought more companies should have done since the tech bear bottomed in 2002. And that is to buy a little growth, consolidate its space and specifically target niche stocks with strong balance sheets -- thus partially self funding the deal with the acquirees cash and investments. Meanwhile here are some tech ramblings:
- Just as General Electric (GE) wasn't the best broad market tell (GE is a continuation of the finance lending story) -- I don't think Texas Instruments (TXN) will be a good tell for the semi-space. Note strong results from Volterra (VLTR), Linear Tech (LLTC) and Intel (INTC).
Apple (AAPL)is getting smacked while Google (GOOG) is running. I really should have added the other day around $535. That level and below is my new buy level, while $515 is preferred for adding. Baidu (BIDU) $350 should have GOOG nearing $650. Given that where will GOOG trade if BIDU crushes? Has BIDU priced in a crush? Somehow I don't think so.
Okay, this isn't tech but am I wrong to dig the UltraShort Oil & Gas (DUG)? Oil needs to make a top before it falls. Given that, where will DUG be trading if Oil goes back to $90?
Position in BCSI, TLAB, GOOG, DUG
Let the tape come to you... - Quint Tatro - 11:05 a.m.
Yesterday and today I've been a net seller of my QQQQ, IWM and SPY, however I'm not turning bearish, just believing that we need to rest.
All major averages are bumping up against some serious resistance that not many are talking about.
I'm concerned about the Feb 1st high in the S&P 500, as well as the descending trend line. The fact that the trend line descends makes longer term resistance lower, the longer we trade, as a function of gravity. Until this average really breaks out, I will continue with my same mantra that has been serving me well. Buy weakness, sell strength. See chart.
The Q's have broken out of the channel and now I am watching to see how they react to consolidation. All eyes are on the gap below. If we break back into the channel I suspect it will be filled. If we continue to see light volume selling, I will start to wade back in however it feels too early at this moment. See chart.
The small caps, who typically lead due to their beta, both up and down, are already cutting into last Wednesday's move. This is key and something I have been watching for. This is the one I will be looking to wade back into first. See chart.
The mood is improving Minyans, but it's too early to throw caution to the wind. Let the tape come to you.
Position in QQQQ, IWM, SPY
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