Random thoughts at the end of the week –
Volume
- Daily volume slightly favored the upside
- Weekly volume lower than previous week on down price action
- No real buyers and anything unanticipated will probably bring out the sellers
Internals and Sentiment
- Interday TRIN moved over 1.85 and TRINQ moved over 2.0
- Advance / Decline and Up /Down volume breadth is terrible on the Nasdaq and less so on the NYSE
- Market is neither overbought nor oversold
- AAII sentiment shows a lot of bulls all of the sudden
- COTS commercials is slightly net long
Price/Time
- 5 consecutive lower lows to 20dma on SPX
- But SPX had an inside week
- SPX bounced off the 1:1 descending Gann Angle from Oct02-Oct07 range
- SPX 1:1 descending Gann Angle from Oct05-Oct07 is around 1440 and the same for the angle from the Feb95-Mar00 range
- SPX 1440 is 360+90 degrees from the March bottom
Market Leaders
- GOOG, AAPL, RIMM all appear to be setting up for a “C” move into the October low. I’ll post analysis in the near future of the e-waves I see and the time cycles that hit this week
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Tags: A-B-C Correction · Apple Computer (AAPL) · Elliott Wave Analysis · Google Incorporated (GOOG) · Research In Motion (RIMM) · SP500 · Square of Range6 Comments
Andy
Apple actually made a temporary all time high in October of last year. It ‘crashed’ in November, when it went down around 20% in a week or so. THe November low on Apple was around 150 or so. I guess I am very curious as I am playing the downside on apple right now (puts)…
Second half of the year, unless consumers vanish and the next iphone is a flow, I’d still be long apple, maybe august-september
Kurt,
I have found a number of the best stock with similar patterns. They went down with the entire market last fall and then have retraced that move. The retrace is much weaker on volume for AAPL, GOOG, and RIMM. This confirms (to me) my hypothesis of a big move down into October. My worry is that we won’t even make it to June before this happens. I hope to have a post this weekend covering these stocks.
Andy,
I actually am hoping that apple will retrace that move. I did buy some June puts for apple, thinking that we got ahead of ourselves big time (again) and that we are due for a correction. Long term I still think that apple will deliver, but with options you got to be right both in time and direction to make a nice chunk…
Andy, I am looking forward to your analysis on AAPL.
I have a question for both Andy and Kurt. I agree with you guys that AAPL moved up fairly quickly from its lows and not with a volume that one would categorize as bullish.
However, AAPL is going to be announcing a 3G phone and possibly a new upgrade/technology in MAC pretty soon. may be in the next 2 weeks.
why would you guys not include something that real and fundamental in your chart analysis ?
TK
TK - About new products reflected in the price - if everyone knows about the release, wouldn’t you expect price to reflect that before the release?
I am working on the cycles post for AAPL, RIMM, and GOOG and hope to release it before Monday morning.
TK, I think everyone knows the 2nd generation iphone is coming out soon. How soon is the guess. Also, several announcements of new countries being covered for the iPhone are helping things, but they are out now. I don’t like the fact that apple reversed at 188, and I am basing my bearish (short term look) on that. I am also taking Andy’s view into account, that the markets are due for a change in direction in the next couple of weeks (last time that happened apple went from 200-115 in 6 weeks). I don’t think it will be that bad, but given that apple doesn’t defend its positions mid quarter, i’d think we will be in the throes of the larger market…
Andy makes a great point about ‘once everybody knows things, then they are already priced in’.
Kurt