Volume was up on a second down day on the major indices. But as bad as the press coverage of the last two days are, the actual chart looks in good shape. Tomorrow is day three and an afternoon reversal back up is a possibility.
The small cap stocks were not sold on volume. But keep in mind that these stocks held up well in September … until they didn’t and the bottom fell out.
Charts courtesy of Stockcharts.com
Tags: Distribution Day · Nasdaq Charts · Russell 2000 Smallcaps11 Comments
11 responses so far ↓
andy
can you elaborate on the chart being in “good shape”
I am seeing different key #’s all over the internet. 897 is supposedly the 61 retrace line and if we go below that the bottom is supposed to fall out.
i also ready that we needed to close above 920 to really secure a rally which we did not do.
I really trust the concept of price matching volume but I don’t know how to do the TA to determine best course of action. Your first sentence seems to imply we are in trouble–volume up for 2nd day–then you say we should rally– help me understand and any further guidance on what to watch for as we go into tomorrow would be greatly appreciated.
Also–one other question — a great blogger who was insanely accurate made the comment a month or so ago that Goldman Sachs was a key indicator for the entire S and P and that it reached its low in lockstep with the S and P the last 5 times or something like that. He said Goldman would ultimately test 65 which was it’s 2000 low I believe He no longer posts which has hurt my knowledge base greatly.
GS is definitely heading towards it’s oct low — can you provide any insight on the price volume situation on GS and where you think it’s heading?
looking forward to your reply
almost44 - I don’t know anything about any key #. The Oct low is a key number. Otherwise, anything else is just filler…. people need to post something… so they do… just because you read it does not make it is useful. I use Gann’s method for reading swing charts. We had a 6-7 day rally up and I expected a 1-3 day correction. As long as price remains above the low, I am happy. Volume was up today so technically a distribution day. But volume wasn’t extreme and was below last week’s up days.
Goldman - I don’t know anything about the price. But it was key in that it was days (maybe hours) away from going belly up. Da gubmint finally figured that out and fixed it. Money is nothing but electrons and easily fixable… until the underlying systems are destroyed. If GS had died the whole thing would have collapsed down to almost nothing.
Andy,
I suspect there is a reason you remain happy “as long as price remains above the low”. That reason is that you are not invested. People with money in the market lose in two days what in less volatile times took one year to accumulate. I am looking forward to when we will not have to endure such extreme drawdown every time the market moves up.
. As long as price remains above the low, I am happy.
does this mean as long as the price of the index or stock remains above the low of the day? I am unclear–sorry if this is easier to understand than I am making it
thanks for all your help
A few comments:
A. There is talk of solar storm starting tomorrow which historically has caused market bottoms. Somehow it depresses people and they sell stocks. But I guess if everyone is aware of it then they might start selling earlier and maybe it will not have any effect. Sounds crazy, then check it out. http://bcm.bc.edu/issues/winter_2004/ll_solar.html
B. Libby, Are we doing wave 5 of 3 now and should that take us into new lows. I am thinking more SPX 770 or worst. My initial number was 875 like yours but not sure anymore. have not had time to check out internals yet. BTW, welcome to AZ anytime.Let me know when you are around
C. I do see a lot of potential reverse H&S formations, triangles which are continuation patterns, and/or some down channels also in many stocks and long ETFs. All on 60 minutes charts so not much weight to upside potential. This thing might need lots of work imho.
D. Bank robberies are way up in AZ. Some people are getting desperate
E. A possible trading range might be what we get if no breakdown occurs.
my 2 cents
rayN
storm was minor
but u r correct
Atlanta Fed has article on geomagnetic storms
Hi everyone, Just want everyone to know that Andy also has his charts located at Stochcharts.com under the public charts, just scroll down and you will see andy askey or it might say A. Askey, and you can view all of andy’s charts on all the stocks that he follows, and if you become a Premium content member,(Hint,Hint) Andy will do a chart for you on your favorite index or stock, but you better check with him on that though he has so many I really don’t know how he keeps up with all of them. Andy knows that I am his #1 fan, I piss him off every now and then,(I think), but he puts up with my comic reviews when I need to vent on his site. By the way He loves Donations, Hint Hint….I know we are all cash strapped but he’s like the Pizza delivery boy, he needs a tip every now and then…LOL! Paypal delivers in less than 30 min’s. Did you take that walk tonight Andy? Did you see out west 50inches of snow!!!!!… another possible Hurricane,,, I know this isn’t the weather channel but hey who reads my Sh-t anyway. “Ray”, Andy is on this thing , maybe a nice bear rally today!!!! I know its only 2am but its a nice thought. I like the Pit idea Ray, bottom…less…pit….yep, little rally to gather $ from the put kings and queens and then back to bear mode….and how low can we go….don’t split your pants out
Libby - Thanks for the promo. You never have pissed me off and I really appreciate your commentary. You are correct more than you are wrong. Please keep up the good work. No walk tonight. I got a flu shot on Wednesday and always make my bones hurt for a day or two. Kinda like the mini-flu. Snow? Time to swap the lawn mover for the snow blower.
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My public charts at Stockcharts are here.
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID1744189
I don’t keep them up like I did in the past because I don’t have time. If anyone sees one they want me to update then let me know. I use this list as a long term reminder of indices, economic factors, and stocks to prompt me for posts to the blog.
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The subscription area consists mainly of longer term industry geometry charts. Sure we know that financials and brokers are down, but what is the slope of this move versus previous moves? That is what subscribers receive. For $2 per week I try to cover the major indices and industries/sectors for quick analysis of “where are we now”. There is a $15 two week trial that many people have signed up for just help pay for the site.
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The money I receive for subscription and donations is pumped back into the site for more and better data to help my analysis. Traffic has picked up in the past month or two and my cost to run the site increase with the new readers. If I ever get rich off the site you will know… I will change the site to a “How To Get Rich with a Blog” site…
almost44 - “Good shape” to me means that the market is up off the lows and is acting better than the past month. Volume for up days is usually more than down days. That means accumulation. Maybe the market won’t go anywhere for a while (like in 1987). But, at least at this point, the sellers appear to have run out of ammo.
Fred - “Happy” with the market is relative. I like the current price action. But a lot of my investments are underwater. I’ve kept about 2/3 of my money out of stocks so I have a lot of dry powder when I am more confident with the market. While I like the current action, I am not adding to my longs at this point.