Friday, October 24, 2008
Sugar, We're Goin Down!
Wow what a day in the markets. I never was convinced on the rally from mid morning onward. I took a nice short in the futures around 1:30 pm et and covered for a great trade shortly thereafter. You really got to have a scalper's mentality on days like today. I shifted away from my short side bias after the 15 and 30min SPX chart started to perk up but in the last hour of the day there was some serious choppy action. Right at 3pm et huge buy volume came into the ES and pushed the futures up about 25 pts in minutes. Everyone got a little happy that we may have a positive close on the day and maybe salvage a decent weekly close. Not quite sure who the hell was buying all that paper at 3pm et but its irrelevant now as the market used the last 10mins of the day to sell off from roughly 890 to 865 on large volume.
This is not a good way to finish a week in which many hoped we could bottom out after testing the lows from Oct. 10th. I hate to be the bearer of bad news but I think we are going down next week. Today was almost like a wasted day because any rally that had hope just faded away. Some think we should have had a bigger washout at the open when the futures were limit down. So another 300+ selloff is almost like a cheap trick that the market is playing on the optimistic. Art Cashin was on today talking about some kind of lunar cycle in astrology next week. He claimed (quite seriously) that these planetary shift or whatever the hell is going on, lol, might signal a bottom. Ok I'm sorry I'm not an astrologer, but I do wanna check my horoscope now thanks to Mr. Cashin, lol.
Anywho, I'm a chartist so regardless of what the heck is going on with Mercury and Venus I see a breakdown coming next week and if we cant hold the 845 level we may see things unravel at rapid speeds. There was nothing bullish about the way we closed the week and I just dont quite see why this market would go up Monday. Anything can happen of course but I just have a feeling we see lower prices next week and perhaps, just perhaps, this time we get a true washout without the aid of the gov't artificially creating a floor.
Enjoy the weekend people. Get outside and breathe in some fresh air with family and friends!