The morning of Monday, August 9 2010 was continuation from the late rally on the previous Friday. These types of huge upward moves at the end of trading are extremely important. At market open, the market is dominated by amateurs. At market close, the market is dominated by professionals. The reason is that the majority of amateur traders have day jobs that don't allow them constant access to trading. Pros, on the other hand, trade all day every day. Amateurs and professionals trade against each other. For this reason the open and the close tend to be at opposite ends of a daily candlestick.
At around mid-day on Monday, August 9 2010, a small sell off took place but true to the late buying pattern stated earlier, the market had a good up move into the close.
Tuesday, August 10 2010 was unbelievably different. The market opened up having a massive gap down, with trading starting at 112.50 (SPY) as futures were trashed. Asian and European equities posted broad-based losses, with the Shanghai Composite index ending down 2.9%. The declines came after data demonstrated that China's July trade surplus surged to $28.7 billion, as exports soared 38.1%. This was a clear case of foreign markets pulling down our markets primarily on the back of decreasing growth in China.
By mid-day, the news hit that U.S., wholesale inventories rose .1 percent in July, while sales fell .7 percent; economists surveyed by Reuters had predicted a far more robust build in inventories along with a sales increase. This pushed SPY right down to 111.50. But even slower development in China, unsatisfying wholesale inventories and sales, and also the anxiety of the emerging Fed policy statement did not stop the final hour rally. By the close, professional bull traders sent SPY back to where it opened at 112.50
Wednesday, August 11 2010 was horrific. The prior day's U.S. economic data along with reports from China and Japan also illustrated the slowing down of the global recovery. Stock index futures dropped to session lows after the government reported a greater-than-anticipated trade gap of $49.9 billion in June.
The Fed declared it can help support the recovery by reinvesting maturing mortgage-backed securities in longer-term Treasury securities.
Traders commenced selling after the Fed announcement. The thing is, the Fed has been plainly proclaiming that it planned to lower the money it put into the economy as the recovery picked up pace. The Fed's move of purchasing Treasury securities implies that the Fed must act to halt a double dip recession.
Next more awful news hit on August 11, 2010. Personal computer purchases are falling off a cliff as outlined by J.P.Morgan analyst Christopher Danely, which issued a research report downgrading his revenue and earnings estimates for Intel, our planet's largest chip maker. Meanwhile, Robert W. Baird & Co. analyst Tristan Gerra provided a similarly glum evaluation of PC orders.
"Our own checks indicate a sharp deceleration in PC order trends continuing into August, following a below-expectation July month," Gerra published in a note to customers. "Hopes of a meaningful recovery for the September month are less and less likely, in our view, leading to a likely below-expectations for next quarter."
If you subscribe to my channel on You-tube or are a reader of my blog, you are already aware that tech must rally to bring us out of a bear market. Tech has always done this. This is known as Sector Rotation. Tech will be the sector that leads an economy out of a recession for the reason that it is technology that permits businesses to improve productiveness while reducing costs. Consequently with PC orders falling off a cliff, it provides institutions a definite indication that without the support of tech, this market is not yet ready to leave this recession. Along with the Fed's action of buying longer-term Treasury securities, additionally, it means that this economic recovery is officially deceased.
Professional traders responded accordingly by rushing for the exits. By the end of the day on Wednesday, August 11 2010, SPY closed at 108: an astounding 3.8% drop in just hours. The VIX which measures the amount of put buying leaped 14% and technically went into an uptrend. Without a doubt, Wednesday was a critical day for the markets.
On Thursday, August 12th, 2010, the market traded generally flat. Very good earnings from GM were crushed by discouraging earnings from tech bell-weather Cisco and its lower earnings forecast moving forward. Also weighing in for the bearish side was documented weekly jobless claims rising 2,000 to 484,000, versus a drop predicted among economists.
Friday, August 13th, 2010 completely erased Thursday's small gains and formed a sideways Rectangle pattern.
Inside the video tutorial below, I do stock chart analysis on SPY and give you my prediction for the week ahead. There exists a major pivot support zone you should short the market if it breaks below.
Important economic reports planned for release in a few days:
Aug 16 = NY Fed - Empire Manufacturing Index, NAHB Housing Market Index
Aug 17 = Housing Starts, Building Permits, PPI, Industrial Production
Aug 18 = Crude Inventories
Aug 19 = Unemployment Claims, Leading Indicators, Philadelphia Fed
The morning of Monday, August 9 2010 was continuation from the late rally on the previous Friday. These types of huge upward moves at the end of trading are extremely important. At market open, the market is dominated by amateurs. At market close, the market is dominated by professionals. The reason is that the majority of amateur traders have day jobs that don't allow them constant access to trading. Pros, on the other hand, trade all day every day. Amateurs and professionals trade against each other. For this reason the open and the close tend to be at opposite ends of a daily candlestick.
At around mid-day on Monday, August 9 2010, a small sell off took place but true to the late buying pattern stated earlier, the market had a good up move into the close.
Tuesday, August 10 2010 was unbelievably different. The market opened up having a massive gap down, with trading starting at 112.50 (SPY) as futures were trashed. Asian and European equities posted broad-based losses, with the Shanghai Composite index ending down 2.9%. The declines came after data demonstrated that China's July trade surplus surged to $28.7 billion, as exports soared 38.1%. This was a clear case of foreign markets pulling down our markets primarily on the back of decreasing growth in China.
By mid-day, the news hit that U.S., wholesale inventories rose .1 percent in July, while sales fell .7 percent; economists surveyed by Reuters had predicted a far more robust build in inventories along with a sales increase. This pushed SPY right down to 111.50. But even slower development in China, unsatisfying wholesale inventories and sales, and also the anxiety of the emerging Fed policy statement did not stop the final hour rally. By the close, professional bull traders sent SPY back to where it opened at 112.50
Wednesday, August 11 2010 was horrific. The prior day's U.S. economic data along with reports from China and Japan also illustrated the slowing down of the global recovery. Stock index futures dropped to session lows after the government reported a greater-than-anticipated trade gap of $49.9 billion in June.
The Fed declared it can help support the recovery by reinvesting maturing mortgage-backed securities in longer-term Treasury securities.
Traders commenced selling after the Fed announcement. The thing is, the Fed has been plainly proclaiming that it planned to lower the money it put into the economy as the recovery picked up pace. The Fed's move of purchasing Treasury securities implies that the Fed must act to halt a double dip recession.
Next more awful news hit on August 11, 2010. Personal computer purchases are falling off a cliff as outlined by J.P.Morgan analyst Christopher Danely, which issued a research report downgrading his revenue and earnings estimates for Intel, our planet's largest chip maker. Meanwhile, Robert W. Baird & Co. analyst Tristan Gerra provided a similarly glum evaluation of PC orders.
"Our own checks indicate a sharp deceleration in PC order trends continuing into August, following a below-expectation July month," Gerra published in a note to customers. "Hopes of a meaningful recovery for the September month are less and less likely, in our view, leading to a likely below-expectations for next quarter."
If you subscribe to my channel on You-tube or are a reader of my blog, you are already aware that tech must rally to bring us out of a bear market. Tech has always done this. This is known as Sector Rotation. Tech will be the sector that leads an economy out of a recession for the reason that it is technology that permits businesses to improve productiveness while reducing costs. Consequently with PC orders falling off a cliff, it provides institutions a definite indication that without the support of tech, this market is not yet ready to leave this recession. Along with the Fed's action of buying longer-term Treasury securities, additionally, it means that this economic recovery is officially deceased.
Professional traders responded accordingly by rushing for the exits. By the end of the day on Wednesday, August 11 2010, SPY closed at 108: an astounding 3.8% drop in just hours. The VIX which measures the amount of put buying leaped 14% and technically went into an uptrend. Without a doubt, Wednesday was a critical day for the markets.
On Thursday, August 12th, 2010, the market traded generally flat. Very good earnings from GM were crushed by discouraging earnings from tech bell-weather Cisco and its lower earnings forecast moving forward. Also weighing in for the bearish side was documented weekly jobless claims rising 2,000 to 484,000, versus a drop predicted among economists.
Friday, August 13th, 2010 completely erased Thursday's small gains and formed a sideways Rectangle pattern.
Inside the video tutorial below, I do stock chart analysis on SPY and give you my prediction for the week ahead. There exists a major pivot support zone you should short the market if it breaks below.
Important economic reports planned for release in a few days:
Aug 16 = NY Fed - Empire Manufacturing Index, NAHB Housing Market Index
Aug 17 = Housing Starts, Building Permits, PPI, Industrial Production
Aug 18 = Crude Inventories
Aug 19 = Unemployment Claims, Leading Indicators, Philadelphia Fed
The morning of Monday, August 9 2010 was continuation from the late rally on the previous Friday. These types of huge upward moves at the end of trading are extremely important. At market open, the market is dominated by amateurs. At market close, the market is dominated by professionals. The reason is that the majority of amateur traders have day jobs that don't allow them constant access to trading. Pros, on the other hand, trade all day every day. Amateurs and professionals trade against each other. For this reason the open and the close tend to be at opposite ends of a daily candlestick.
At around mid-day on Monday, August 9 2010, a small sell off took place but true to the late buying pattern stated earlier, the market had a good up move into the close.
Tuesday, August 10 2010 was unbelievably different. The market opened up having a massive gap down, with trading starting at 112.50 (SPY) as futures were trashed. Asian and European equities posted broad-based losses, with the Shanghai Composite index ending down 2.9%. The declines came after data demonstrated that China's July trade surplus surged to $28.7 billion, as exports soared 38.1%. This was a clear case of foreign markets pulling down our markets primarily on the back of decreasing growth in China.
By mid-day, the news hit that U.S., wholesale inventories rose .1 percent in July, while sales fell .7 percent; economists surveyed by Reuters had predicted a far more robust build in inventories along with a sales increase. This pushed SPY right down to 111.50. But even slower development in China, unsatisfying wholesale inventories and sales, and also the anxiety of the emerging Fed policy statement did not stop the final hour rally. By the close, professional bull traders sent SPY back to where it opened at 112.50
Wednesday, August 11 2010 was horrific. The prior day's U.S. economic data along with reports from China and Japan also illustrated the slowing down of the global recovery. Stock index futures dropped to session lows after the government reported a greater-than-anticipated trade gap of $49.9 billion in June.
The Fed declared it can help support the recovery by reinvesting maturing mortgage-backed securities in longer-term Treasury securities.
Traders commenced selling after the Fed announcement. The thing is, the Fed has been plainly proclaiming that it planned to lower the money it put into the economy as the recovery picked up pace. The Fed's move of purchasing Treasury securities implies that the Fed must act to halt a double dip recession.
Next more awful news hit on August 11, 2010. Personal computer purchases are falling off a cliff as outlined by J.P.Morgan analyst Christopher Danely, which issued a research report downgrading his revenue and earnings estimates for Intel, our planet's largest chip maker. Meanwhile, Robert W. Baird & Co. analyst Tristan Gerra provided a similarly glum evaluation of PC orders.
"Our own checks indicate a sharp deceleration in PC order trends continuing into August, following a below-expectation July month," Gerra published in a note to customers. "Hopes of a meaningful recovery for the September month are less and less likely, in our view, leading to a likely below-expectations for next quarter."
If you subscribe to my channel on You-tube or are a reader of my blog, you are already aware that tech must rally to bring us out of a bear market. Tech has always done this. This is known as Sector Rotation. Tech will be the sector that leads an economy out of a recession for the reason that it is technology that permits businesses to improve productiveness while reducing costs. Consequently with PC orders falling off a cliff, it provides institutions a definite indication that without the support of tech, this market is not yet ready to leave this recession. Along with the Fed's action of buying longer-term Treasury securities, additionally, it means that this economic recovery is officially deceased.
Professional traders responded accordingly by rushing for the exits. By the end of the day on Wednesday, August 11 2010, SPY closed at 108: an astounding 3.8% drop in just hours. The VIX which measures the amount of put buying leaped 14% and technically went into an uptrend. Without a doubt, Wednesday was a critical day for the markets.
On Thursday, August 12th, 2010, the market traded generally flat. Very good earnings from GM were crushed by discouraging earnings from tech bell-weather Cisco and its lower earnings forecast moving forward. Also weighing in for the bearish side was documented weekly jobless claims rising 2,000 to 484,000, versus a drop predicted among economists.
Friday, August 13th, 2010 completely erased Thursday's small gains and formed a sideways Rectangle pattern.
Inside the video tutorial below, I do stock chart analysis on SPY and give you my prediction for the week ahead. There exists a major pivot support zone you should short the market if it breaks below.
Important economic reports planned for release in a few days:
Aug 16 = NY Fed - Empire Manufacturing Index, NAHB Housing Market Index
Aug 17 = Housing Starts, Building Permits, PPI, Industrial Production
Aug 18 = Crude Inventories
Aug 19 = Unemployment Claims, Leading Indicators, Philadelphia Fed
Copyright 2009-2011 GuerillaStockTrading.com All rights reserved. No part or article on this website may be copied or duplicated without written consent from GuerillaStockTrading.com and Confab Publishing. Disclaimer: This Web site is designed to provide accurate and authoritative information on the subject of personal finances. It is provided with the understanding that neither the author nor the publisher is engaged in rendering legal, accounting, or other professional services by providing this Web site. The authors and publisher shall not be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential or other damages. As each individual situation is unique, questions relevant to personal finances and specific to the individual should be addressed to an appropriate professional to ensure that the situation has been carefully and appropriately evaluated. This blog is for information and entertainment purposes only. Under no circumstances does this information represent a recommendation to buy or sell securities or any other type of investment instruments. See a licensed broker for investment advice.
Guerilla Stock Trading University