DJIMstocks.com- DJ Interactive Markets

Once again the market did the unthinkable 'early on'.    It rallied off more slashing of guidance/ bad news all around, predominately in the tech sector (which led higher).    But, as soon as the SPX closed in on previous days high of 918,  reality sank in or more importantly the 'technical' trade rolled in.    It was just unsustainable off a big move in the previous session , improbable to shrug off more bad news immediately.   SPX bounced off 886 (its 30MA) almost back to 900,  we'd look at this as support in tomorrow's trade and anticipate some Automaker news.

Despite, the closing numbers, it just didn't look like sellers were taking control, more like just buyers petering out after a nice multi day rally.   Basically, it didn't look scary, probably due to no one really wanting be ahead of a pending Auto deal.   The decline can also be attributed to......Treasury yields approach 0%…..Treasuries rose, pushing rates on the three-month bill negative for the first time….The Treasury sold $27 billion of three-month bills yesterday at a discount rate of 0.005 percent, the lowest since it starting auctioning the securities in 1929. The U.S. also sold $30 billion of four-week bills today at zero percent for the first time since it began selling the debt in 2001 (Bloomberg).

Meanwhile,  back at DJIM's ranch our early focus (alert) turned to the E&P's off some positive drilling results on the heels of CHK's liquidity plan from previous day and it continued throughout the day.   We all remember the great, but somewhat short lived trade (3 months) off the Haynesville Shale stocks.   CHK is the dominant name here with smaller caps like HK, GDP, CRK, XCO, GMXR.    Almost all bubbled up as names moved off each others results as in the past.    The broader tape was rather flat as most commodities were down or flat.   This included par performance from bigger energy names which subdued these moves somewhat.  It wasn't the perfect storm,  we hope for a widespread oily move tomorrow to help these Shales along.

Of course,  the biggest moves can be seen in the 'beaten down' under $10 stocks, which comprises almost all shipping stocks.    The moves can be attributed to one piece of news from a single company citing there has been a pick up in activity in Asia re Iron Ore, Coal, Copper, Steel.   Also, bulk shipping rates had rose for 1st time in 14 days have caused some exuberance.   Unfortunately, we keep reading negative headlines at same time,... Nippon Yusen K.K., Japan’s largest shipping line by sales, cut its fleet expansion plan by up to 60 vessels as slowing economic growth curbs demand for transporting steelmaking commodities including coal and iron ore.   We just can't get excited for a turnaround here, just yet,  it is strictly your own decision to trade these intraday at this juncture.

Anyways,   the commodity stocks are showing a pulse,  one look at NUE's (steel) action off guidance today is telling that maybe the market has priced in more than enough bad news heading into 2009.

In a typical "shrug off the bad news.. (more slashing in guidances..AOU,MMM, MET), and propell on good new...eg..(reports that November hedge fund declines slowed vs. October, giving hope that the industry's forced selling may be abating,  a slew of market ‘bears’  making some sanguine comments...Heebner, Fleckenstein, Ritholtz, Birinyi),  we rallied again today.    It seems market is craving for good news while bears do what they can to hide from the action for now.    The biggest "good news" lifted the infrastructure group, (stocks here on list include FLR, VMI,  along with steel and few others, had the biggest gains for the day.   This is all thanks to the new administration's proposed infrastructure program.    By the way, the new program is supposed to be the biggest since the 50s.   In addition, the hope that an Auto bailout deal will be reached added to the enthusiasm.....Into the trading week...... We also have some more Obama noise on a massive public spending program hitting the rounds and the apparent progress this weekend in regards to the Automakers.).     It may be time to let these infrastructure stocks, including steels to consolidate to buy later or short shortly.    There is also the big tech infrastructure play now creeping in as Obama spoke of Web expansion this time helping the CSCO's along.

So,  with market's late ability to shrug off every piece of bad economic news, why would anyone even consider shorting this market?.    How about because we've gone too far, too fast.  This move brings technical analysis to the forefront some more...SPX note later here.

Well,  unless anyone thinks we are NOT back into the beginning of an economic boom soon, there's about every reason to short this market.    The afterhour news lately just hasn't been friendly for the bull, either.   Tonight we have TXN, NSM, ALTR, BRCM, FDX all warning for the coming quarter.    Can we 'shrug' this off tomorrow,  it would seem improbable as we near 930 SPX, but stranger things have happened this year.    This would be impressive if it occurs!.    Basically, the infrastructure program may be all that,  but it isn't going to help those white collar workers who prefer to work inside the office.    Frankly, the rally we've been getting lately is bit of a challenge to categorize.  Positive is we do have real buyers coming off the sidelines, not only short squeezes paving the way and we have seen some unwinding of the safety flight.   But, confidence is still an issue as nobody wants to get shot in the foot by chasing too far.

We know things move fast, and the next thing you know,  we can be testing SPX 930 (50ma, next vital level),  than 950 and SPX 1000 successively.    It can happen in a matter of days, not weeks.    This actually gives us a pretty good range to work with.    Essentially,  we feel that we may be going (stuck) into ranged trading for the next while until something major happens.    From SPX 780 to SPX 1000 is what we are looking at.    Right now,  as we set eyes on mid 900s, we think it may prudent to have the short side itch.    Currently, we are still monitoring the Financial sector, as much as anything else.    The less drama and more stability we get from the sector, the more likelihood that we may have seen the bottom last month.

Plays like HIG,... may give us some quick points here and there,  but, we may start to do some more position trading in the near term,  in addition to trading the index ETFs.   This is all assuming that market doesn't collapse with VIX gunning for 80+ any time soon.

CHK,  with the cold weather upon us, Oil lifting off $40, hedgies taking a potential break, it might be time to look at some energy stocks once again.  We opened a position in CHK instead of the pure Shale plays based on some good news from them in that they could be fully funded for '09/'10 and thus an overweight from JPM.

A few things from last week Journal focus showed it's colors by Friday!.

"Shrugging off"….what better indicator of shrugging off bad news than what we witnessed Friday after the brutal employment number, yet market rebounded strongly.  Sells off are becoming shorter in duration.    A teflon market is seemingly here.   The market had reasons to go to bed and not get up, Economic data was horrendous last week…ISM, factory orders, ADP and endless EPS wrecks, outlook cuts in RIMM leading a pack of NOK AMD PALM ISIL SWKS TSM WFR XRTX  etc.   Add a bankruptcy news from PPC and at least 5 more defaults, credt mkts still trouble (Cali, NY/NJ),  geo -political tension(India) and the never ending Automaker debacle weighted in,  yet the market lived!.     Okay, it wasn’t all bad news, we had plenty of good stuff such as MBA/ mortgages numbers showing a huge refi boom , banks/gov’t interventions all over the world,  a potential gigantic and radical cash infusion in the U.K,  a strong USD and low Oil despite all the FED print work and more fed/ Bernanke positive announcements/ quantitative easing.   CSCO implied trends so far are consistent with guidance was a mid week positive.

In conclusion,  everything is deterioating from eco- news to EPS outlooks..but stocks held the previous week gains pretty well.   We have to think year end melt up possibility….basically we have to be openminded late in the year it seems or we may miss some substantial gains.

"Financials"…..there was one positive early Friday and many times it’s a tale of things to come.  During the early morning beating,   XLF (financials),   thus many brokerage and Financial stocks were OUT-performing.    We also had the Insurers  acting great,   HIG,  given out by a member led the way into a squeeze that lasted the day and probably into Monday!.    We keep harping to keep an eye on the financials and this is even true for day to day action trends, not just long term.    If they are doing well in a bad market day like Friday,  the market will most likely do well at some point intraday.    Friday proved this.   So always keep an eye on what's working and what's not,  even in bad markets as it may be a signal of things to come.    There is also news reports that the life insurance industry could receive relief from state regulators when it comes to capital, also a positive.

"Beaten down stocks"...one glance at HIG and other SPX leaders for the week lead to one way of thinking,  HIG +78%, CIT +51%, PFG +34%, PRU +28%, CTX +28%, LEN+28%, PLD +26%, LNC +23%, SHLD +23%, KBH +21%, BBBY +20%, BSX +20%, XL +19%, TIF +19%, DHI+17%, THC +16%, ODP +15%, LSI +15%, CI +15%, SNDK +15%.

It is time to look at beaten stocks,   particularly in the SPX that can have great gains in days-hours,  if we are in a melt up holiday ensuing market.   So, watch for news that may seem irrelevant.    Any other day in the EPS world, you'd look at HIG's EPS headline and let it pass,  but we have stocks at such beaten values the chances of a squeeze are great.   If we are in such an environment, start using the Forum to throw out a few names, some may turn out great like HIG, others may not.  We are responsible for own decisions if to chase the dollar store stocks (cheapies) or not.

"Oil".... sooner than later this will be a great opportunity,  even if it oil goes to $60.   That's a 50% gain.  We haven`t been at these prices since January 2005.   The money to be made won't be in in individual stocks.  Oil rig stats are declining day by day going forward.   Let's look at the ETF's instead.   Last week we had a question about the 3X ETF`s ERX-ERY on forum and said they are not going to follow OIL price,  but the R2K energy stocks component.   Well,  we saw more as we were monitoring their action.   One look at Fridays action and you can see why these can be powerful movers and have nothing to do with the price of OIL.   The rebound in say ERX went with the market rebound, Russell2002-SPX,  not the price of oil which basically stayed at the lows of the day, while ERX went from 26 to 32.70 by close.    Simply,  not only will these ETFs move with the indices such as the Russell small cap indices, but when energy-oil stocks also lead the way, these ETF`s will have even greater moves as they often move the SPX all by themselves in the past because of the weight of them in the index.    Basically, these ETFs can move in various ways…an index move, an index move led by energy and of course can move when oil finally spikes.   You have to think being so much under 200MA in oil is not going to last forever and this "risky" overnight hold maybe the way to play intraday.  DIG/ DUG are the 2x ETF's.

Into the trading week....."SPY"....Levels to watch on SPX futures , 855-850 on the downside and 875-900 on the upside.   Stocks worldwide should be playing some catch up to our markets overnight.  We also have some more Obama noise on a massive public spending program hitting the rounds and the apparent progress this weekend in regards to the Automakers.  Plus, stimulus/ cuts in China / India.   We should test 900 SPX resistance early on.  Under the terms of the agreement being discussed, $14-15B would be taken from the $25B worth of appropriated “green” funds sitting at the DOE to bridge the industry through early ‘09, when a more comprehensive restructuring package will be considered.   Also, not much Eco data this week to worry about,  this should ease concerns of buying into the market.

Well, guess if you are rich enough to have an investment portfolio held with Citadel, chances are you wouldn't be the type trading the market yourself and hence, reading our journal.    Good thing, for us that is!  There was news that one of the most successful hedge fund, run by Kenny Griffin, is currently down 47% YTD, and 13% in November alone.     This is just freakishly amazing.    Sure,  it's much tougher to run a multi billion dollar fund than a million dollar portfolio.     But come on,  if your $20 billion+ portfolio was cut in half in one year,  what the heck is the point of even being in existence?

Okay,  it's a little harsh on Citadel, but this is actually a general point we are tying to make here.   In fact, the entire hedge fund industry is going through some tremendous pain during the last little while.    We have some sources with our local Toronto hedge fund boys and according to our inside source, the best funds is down about 60%.    Granted, alot of funds here, north of the border that is, are heavy on commodity stuff but it is incredible stuff when you think how these "professionals" suppose to know better.    What happened to the hedging part in a hedgfund?  So, if you are bummed out from a small or break even performance the past while, don't be.   On the contrary, pad yourself on the back on the job well done to preserve your precious capital.

Today's action was a little predictable ahead of tomorrow's job report.   Nobody wants to be caught with too many long positions with potentially a nasty job report on the horizon.  Thus, an end day retreat for the market, before thankfully a late attempt to get back to 850 SPX that just failed to hit the mark.  Some are calling for a 400-500k number tomorrow.   Still, we are reserving our opinion on the expectation of street reaction,  it's really anyone's guess.    However, we think a bad report will paint a very gloomy trading environment going forward as reality will sink in.  It seems it must week after week.   By the way, did anyone see the collapse in oil/gas price today?    Ok, it isn't anything new, but the fact there's no support whatsoever in the crude at this point on a technical basis it seems.   We think it is more of a supply issue now.   No Opec country or big oil producer are willing to cut the production.   Basically, once you have turned on the hose (money flowing), it's hard to turn it off.

Our choice of plays have becoming very narrow and limited these days.   Most of the EPS plays have pretty much lost their lust and a new eps season is still sometimes away.     The biggest thing on the agenda is still the automakers' bailout deal.     Believe it or not, we feel that we will only see a "true" bottom if GM fails.   Why we think that?    Because if the big three fail,  we'll most likely have a pretty good view of how this market reacts.    Yes, it's gonna be bad for economy, for employment, politics and everyone.    It will be a true test to see how this market responds to what we think is the ultimate doomsday scenario for this year.     It just can't get any worse.

Ok, fingers are crossed for the job report tomorrow.   More importantly, the type of report will give us a clearer picture of trading in the last three week of the year.

It's pretty clear why the market reverse from the gap down and finished on an encouraging note.  Last week we were saying the market is 'shrugging' off bad news,  we expected this to change early this week as the whales came back.  They did and drove the market down nearly 10% in a single day.   But, as of today,  we can say the market is shrugging off bad news once again and this cannot be ignored at this time of the year.   Also, we can't ignore that the Financials are also making a quick recovery off a few bad days, following a nice run in the prior week.  This needs to stick to go forward!.

The morning had a slew of tech disappointments that led to the gap down.   What happened next was RIMM's negative preliminary 3Q results were being shrugged off as it reversed at the bell from a bad premkt.   Seemingly, the buy side had been quicker to discount the bad news than the sell side!.   Basically, the street was already very cautious.   RIMM’s fundamentals are still strong, and very few large cap tech names can claim growth of this magnitude.   As we watched this positive action, we felt it was important to post that CSCO/Chambers were having a conference starting at 10am as it could be a turning point for the market.   One glance back at the intraday charts and you can see CSCO was starting to move during the conference,  leading the market higher.   Chambers said that trends thus far in the Q are consistent with the assumptions management made when setting guidance November 5th,  signaling business is tracking to plan, albeit a weak plan.    This was enough to set the Semi's in the SOX off as the best performers in tech land.

So,  if we stick to the premise that the majority of days lately the market is discounting , shrugging off bad news and therefore is not being driven by negative headlines, including ADP and manufacturing  data in the morning, later the beige book notes in the afternoon.    So, we ask what is the market trading off??. 

Simple.. we flashed SPX support/ resistance levels before the open..."Some levels to watch...SPX 826, 800, 752 support; 848, 860 resistance on upside ."   Once 848 was broken,  860 was the next level to watch.  It was evident late in the day a battle was underway for this front and a break was very possible.  Finishing at 871, up 22 was well North and gives potential for an early good start tomorrow.    Treasuries, not only equities rallied into the close.   Also helping the mkt is the fact that the government is willing to come in and buy mortgage backed securities as well as bonds with longer duration which is forcing fixed income portfolio managers to purchase longer duration bonds.   Another big positive,  yet not finalized is the Treasury is considering a plan to halt the slide in home prices and UK gov't announced a plan whereby struggling homeowners can demand a 2 yr "mortgage holiday" backed by taxpayers.  These are the good headlines and market is reacting in a positive manner.

Weighing and not to be forgotten on the market is still the Auto Washington Aid unanswered questions.   We also have the retailers reporting November sales Wed night and Thurs morning (the releases could also include some color on Black Friday trends).   Jobs numbers for Nov due out this Friday, consensus on  right now is for a loss of 325K jobs..GS is saying 400K +as of today

In an almost perfect Santa Claus rally world,  we'll get these data figures 'shrugged off'!.   Do you believe in Santa Claus?

Tug of war lasted for about a couple of hours before the market finally made up its mind and ended the day higher.    This is definitely nothing to be cheered for as most of us feel we are merely rebounding from yesterday's nasty selloff.   Short term trading range is likely.  Some levels to watch...SPX 826, 800, 752 support; 848, 860 resistance on upside.

Shall we even rebound at all for an extended time?   Currently, many of the cards are held by the government to decide the outcome of the big three auto companies.    In fact,  much of today's optimism was directly from the hope that a deal will be reached and money will be granted to the auto makers.     We feel that even with the infusion of all those billions into the auto makers, given the current economic condition,  we are only delaying the inevitable.      Basically, assuming these auto makers do get their wish next week,  we are only going to get more turmoil (pain) from the sector down the road.

Originally, we were hoping that a restructuring of the auto makers +  Citi bailout can potentially give us the bottom that we seek and need.     As of this moment,  the theory is still up in the air and verdict is still out there.     Therefore,  after today's rebound,  we are literally stuck in a position that we need to see further movement before we can make an intelligent trade.   Lots of negative tech headlines after the close to dampen today's move.    Until this market changes its recent way of trading,  we are going to fade the move with a downward bias.    It means that we are more eager to go short on strength than buying on weakness, except for a few recent DJIM plays that we'd buy on dips.     But, consecutive down days would most likely get us on the long side and short up bursts would be a better shorting opportunity, in our opinion.

This week,  we have one of the most important economic indicator to be released, employment report.    Market can flip flop between now and then but,  we think the job report can set a pretty big tone for the entire month.    ADP number will be glared over Wednesday as well.   Assuming the accelerated downward economic trend continues,  how would you like to end the year with?    Bunch of beaten down assets or lots of cash?    Unfortunately there's really no in between alternatives.    These days, you are either in control of your financial situation or the market controls you.     The idea of a Santa Claus rally is fading fast as long as this market clings onto the hope of a quick turnaround.

No reason to be wishy- washy, the market got the post- holiday stuffing kicked out if it with one day losses of nearly 10%.   Almost every possibility, we discussed in the previous week came to fruition as the Bears got the turkey leg off the rally feast.   At Mondays closing price with SPX at 850, we wrote...

.."Is the day and change rally sustainable?. Guess, the thinking here is simple considering we were going short the SPX end of day.  The good thing is we get any fantasies of an extended run out of our heads quickly as the market does all it's talking in a very fast way, as in 10% gains in hours. Our emotions don't need to be build up over weeks only to be let down once again.  It hurts more that way, this is better. The only thing that could sustain this is the fact it's a holiday week and most may just rather wait, maybe even let this market climb a bit more into some potential bad news till next week and than go short."

By the time the market broke 870 later on,  most were on the topic of a inverse head and shoulders breakout or something and we squeaked out 890+ overnight into today's trading.   Unfortunately,  we got everything that was feared...the market was led up higher on lower volume during the week, only to be reduced to turkey bone of 815 SPX level by 'Whales'...equity desks continued to see institutional/real sellers (along with some fresh shorts) hammer the market into the close, with ZERO demand on the other side of the trade = a very heavy market.   Also the 'bad news',  which we said seems to have a gag on during holiday trading week flowed in.   The abundance of bad news was widespread, international and domestic, brutal China manufacturing led, Russia, S.Korea, U.S,   some ominous credit stuff such as the chicken stock flying the coop into bankruptcy...Reluctance from Germany to participate in large fiscal stimulus measures (Germany is needed for any large European plan). ....Despite Holiday sales coming in better than feared - concerns over Dec. sales and margins given the highly promotional environment, and the potential for the fragile political situation overseas to disrupt commerce.   Oh yeah, when the gov't officially announces we're in a recession there is no rush to buy anything.   Nice of them to wait till today after everyone's turkey fun.

As we alerted,  if 840 was approached as it was starting to look as a possibility or else why would we alert market conditions intraday, the Bull would be leftover meat!.... 815 from 890 is just that end of day.   We also posted the Inflow/ Outflow summary from the previous week that showed it was just retail traders pushing the market up as there were no funds flowing into longer term equity funds during the bigger volume days of the rally.    The last thing we wanted to see was such action for the health of the market going forward,  such a beating knocks the life out of a lot hope out the window brought on by last weeks Obama antics,  bad news shrugging off....weekend journal... "Right now, we are looking at an extended market that desperately needs a pullback.  However, we have to be careful of what we wish for as a pullback can turn into a nasty collapse like in early November. What we keep our eyes on is the health of financial stocks".   Today was the nasty and financial stocks took the brunt of the beating.   The only positive is Meredith Whitney's comments were taken the wrong way in some respects to consumer credit cards and a morning bounce of sorts maybe in the cards or it just may bounce some cause it was such an ugly close and can't get uglier, just yet.   We're flat going into Tuesday's trade with Capital Hill/ Automakers shenanigans on the agenda,  we'll wait for the reaction.

At the closing on Friday, we had the biggest five day winning session since 1932. Sounds great, if we were not at such beaten down levels. We are still YTD down DJIA -33%,SPX- 39%, NASD -43% going into the last month of 2008. Had this run occurred in any other year and had it taken a few months to accomplish, we are sure many of us would have doubled our portfolio value or more. Unfortunately, this is one of the most uncomfortable run-ups on low volume, we have encountered in a long while.

The question remains, are we going to repeat what happened in the early November? Now that the holiday is over and many traders are back to face a new flurry of economic reports, where are we going to go from here? The "GM Thing" is definitely going to take center stage during the next short while. Does it feel we have reached the bottom a week ago? Maybe , we're in the midst of a bottoming process, but it useless to try to call a bottom as we've said previously.

Right now, we are looking at an extended market that desperately needs a pullback. However, we have to be careful of what we wish for as a pullback can turn into a nasty collapse like in early November. What we keep our eyes on is the health of financial stocks. As long as they don't break lower than the lows of a week ago, we are pretty confident that this market will not test the recent low. Can December be the month that we finally see some stabilization in this market and get some tradable opportunities? We will have the answer soon enough. For now, we just pray that this market doesn't get too carried away with the recent run-up.

As far as individual stocks, the recent plays remain and are quite safe in an economic slowdown going forward, especially the first 3 below, we are also adding Friday's mention here of COGT to our watchlist, but will look for a sufficient pullback first to possibly enter a trade into....

...before Wednesday trade......"EBS, closed with a NCH and again showed it's one to buy on the dips. AXYS, one we noted moves quick points in any rally has not disappointed climbing over 10 points during rally. ASEI, has also notched a NCH. FLR, came all the way back near its post eps gap level. As you can see, some of the plays remain trades on dips. On the other side, MYGN  may be looking like a quick short now".

Lots of economic data releases this week.   Last week the market shrugged off anything bad, we'll see what happens this week as the whales come back.

1-Dec 10:00 ISM mfg (Nov, Index) 37.0 38.9   (street, Prior)
10:00 Construction Spending (Oct, %m/m)  -1 -0.3
2-Dec Total vehicles sales (Nov, 10.5 10.6
3-Dec 8:15 ADP umeployment (Nov) --198 -157
8:30 Productivity & costs revised (3Q, q/q,sa) 0.9 1.1
10:00 ISM non mfg (Nov, Index) 42.0 44.4
4-Dec 8:30 Initial jobless claims (Nov 29, 000s) 540 540 529
10:00 Factory orders (Oct, %m/m) -4.3 -2.5
5-Dec 8:30 Unemployment rate (Nov,%)  6.8 6.5
8:30 Consumer Credit (Oct, $bn) - 1.8 6.9

...keeps the doctor away!.   As long as Obama makes a speech, an appointment every day the market should be in the green for the year by New Years!;).    Unfortunately,  every week is not a holiday week to boost moral as this week has been.   The market (SPX) penetrated the resistance we've discussed and just kept on rolling (on very volume) as end of day selling did not happen for a 4th straight day.  Why?.  Simply, the 'whales' are away!.  Whales are all those hedge funds, institutions that manage 100 mln+ that will return to action next week and only than will we know if this move is sustainable.   Also, remember just before any big holiday there is seemingly a gag order on bad news.   We saw this last year into XMAS season, only to have bad news start to spill early in the year.  It hasn't stopped since. 

This week is purely retail trading, in years past it would involve groups of stocks in say HLS. (Homeland Security stocks),  but this year the infatuation so far is with the ETF's and not individual stocks.   Friday will be very thin trading as markets are only open to 1pm and some stocks/ groups may get manipulated.   The question is which may be played?.  Unfortunately, the world just witnessed the attacks in Mumbai and maybe, just maybe HLS stocks will be those that get manipulated.   We've had a few names here in AXYS, ICXT, IRBT.   Other names COGT, NICE.

The market has shrugged off every piece of bad news this week.  The question to start Monday's trading is what it will do with "Black Friday' numbers.

We have to admit, for the moment, this market is liking the recent turn of events that are giving some people a new found level of bullishness.  Maybe, it's because we hit the 5 trillion aid mark?;)  This time it was Main street that got some Thanksgiving handouts pre market,  not Wall street.   Still, despite the Main street help the market was pretty well a draw today, which could be looked at in a couple ways.  One, the rally needed a rest or two, which could be a negative, is why didn't it go higher with Main street getting aid.   We remain tilted to the short side short term as the market couldn't penetrate a resistance mark (see chart spy in link here) on very good news for the consumer.

It might be that we've become too accustomed with the analogy that every quick bounce has to be sold down hard and furious.  This one just could be different, we have to keep an open mind.   Granted this week is skewed as a lot of traders may have taken this week off all together due to the holiday.     We do have to give it to the policy makers for being so aggressively responsive to the dire financial crisis even in a holiday week.     Maybe, this is all part of the effort to calm people down, or cheer people up, at their annual Thanksgiving dinner tables.    It's the least thing that the government can give to the people, hope!

Again, today's announcement of a new TALF program, and yesterday's Citi bailout deal, are directly aimed at the root of the problem.   This is actually what market wanted to see.    Whether these programs will have any effect or not, still remain to be seen, but the initiative is definitely being welcomed so far.     Remember, market will go wherever our financials go.    If we want a meaningful rally that's sustainable for more than a couple of days, you don't have to look any further than the financials.      We have 1.5 more trading days to go before this week's end.    At this point, we really don't want to bet heavy one way or the other into the weekend.

Other than the usual ETF's we're concentrating (DJIA/SPX related).   We are also keeping our eyes on all of the recent plays we recently traded....

EBS, closed with a NCH and again showed it's one to buy on the dips.  AXYS, one we noted moves quick points in any rally has not disappointed climbing over 10 points during rally.  ASEI,  has also notched a NCH.   FLR,  came all the way back near its post eps gap level.   As you can see, some of the plays remain trades on dips.  On the other side,  MYGN  may be looking like a quick short now.

Happy Thanksgiving to all...