 |
Hello, everyone! This is HappyTrading! As most of you know Phil is on a family vacation for the next 2 weeks. I’ll be "Phil"ing in with the daily posts on Phil’s blog! I’m on the west coast, so it would be difficult for me to do a post before the market opens. Yes, I am still in bed at 4 am (7 am EST). 
So, I don’t promise a morning post, but, I’ll definitely make at least one post a day, most likely in the evening. For our members, which ever post is the lastest will be the one to make your daily conversations in.
Now, let’s talk stocks! Boy, what a market we have, huh?! Down-and-up, run, skip, jump, crawl, roll, fall, spin, slide, and crash; all in one day (Friday)! The major indices all broke the near-term support levels that we have been looking at: the Dow closed below 13200; SPX closed below 1440; and Nasdaq closed below 2525!
Following our market, the Asian markets opened mostly lower, as expected. Japan (N225) opened down over 100 points and went briefly under 16700. It is bouncing back right now, as I’m writing, down only 43 points. Hong Kong is presently down over 560 points, or 2.5%!! Shaighai is actually "up" 51 points at the moment! We’ll have to see in the morning how they all close.
On my blog, we looked at the SPX and Nasdaq’s weekly chart this weekend:
We could look at 1420 for support on SPX. This is where the weekly lower Bollinger Band (BB) is at, and there is a stronger support is at 1400! For the Nasdaq, we’ll be pay attention to 2475!
In both case, the MACD has turned down, which is not a "happy" sign!
On Tuesday (8/7), we have the FOMC meeting. Although most people don’t expect the Feds to lower the rates just yet, more and more people do think that the rates will be lowered before the end of the year. We’ll likely see more volatility in the beginning of the week.
We’ll be paying close attention to the financial (XLF, ETF) and housing (HGX, index) sectors. Oil refiners fell off the cliff these past 2 weeks and still could go lower. Many of the refiners are reporting this week, and Zman will share his thoughts on these earnings plays on Monday. Oil services (OIH, ETF) just started getting hit, although fundamentally speaking, these do have reasons to be stronger.
This weekend, House passed a bill that shifts $16 billion towards renewable energy. This could give the solar plays some buying boost, although the bill itself may not eventually go anywhere. But, be very mindful of the overall market conditions. Online travels might get some positive attention if their earnings are good. CTRP is reporting on Monday (note: CTRP stayed solidly up all day on Friday, regardless of the market) and PCLN is reporting on Tuesday. If the market gets any sort of lift, techs could benefit. To that end, CSCO is reporting on Tuesday.
Of course, we can’t forget about gold. All this craziness on the stock market and in the economy has gotten people buying up gold, as GLD made a nice rise last week.
 |
Well, as Phil said, "Really and truly I do not like to be a bear but I like even less to be an ostrich because we are investing real money in these markets and kidding ourselves is a very expensive game! PSW is as much about money management as it is about picking stocks as it doesn’t do you much good to have 7 out of 10 winners if you blow half your virtual portfolio on pick number 8!"
So, let’s continue to exercise patience and caution. I’ll be staying mostly in cash until we know what the Feds have to say on Tuesday, although I suspect that there will be some good momentum plays before then.
Good night, good morning, and HappyTrading! ™
