R.C. Market Report 10.31

• Market Trend: Neutral

• Market traded higher on low volume again. Nonetheless, to sneak in the first consecutive positive trading days of the month in before end of October, offers a glimmer of hope. Oil made a sharp move higher before their close, and Financial was the leading sector. So things are beginning to show signs of turning around. With that being the case, I still believe that market can go higher without rest. Since the rally will be built on sidelined cash (new buyers) coming in instead of stocktraders that take profit and reenter, this thing can pop at any time. I'd take profit on calls and reenter as we move up higher, but I'd be wary of playing any put plays for the time being. I can see traders returning Monday more upbeat, having survived one of the worst months in history.

R.C. Market Report 10.30

• Market Trend: Neutral

• We finished up nearly 200 points but it sure didn't feel that bullish. As you can see from today's low volume, we didn't have a lot of buyers. However, we didn't have a lot of seller either. This rally looks extended, tired, and out of ammunition. A pullback that doesn't threaten the low would be healthy for this market.

• Then I started thinking about another scenario. This would be a case where buyers come in tomorrow in full force without a pullback. As stocks move higher and traders, as hesistant as they'd be to chase, will be forced to chase. No one wants to miss out on the fast and furious rally that everyone is banking on. The reluctance to buy right away will provide the bullish momentum enough firewood to burn for longer duration. I can see this happening because the big rally has to catch traders off guard somehow. Tomorrow can be that day.

10/30 - Market Analysis

SPX
- at resistance...another consolidation day
- small range...


NDX
- at resistance...similar to most charts i see as the runup brings it right to the 20MA...
- this chart also has strong price history which is a good reason for resistance


RKH
- as with financials, it was a laggard today
- GS very weak all day and we got another inside day and fell from resistance yet again


USO
- resistance here not so strong...
- but USO falling as SPX is a bearish divergence
- as i mentioned, USO needs to rally with SPX for it to be real. in the morning as USO fell to session lows, it brought down stocks soon later...i feel it does this on the daily chart as well


VIX
- in between support and resistance
- i don't know if it can close above resistance though, so this might be a sign that a pullback might be very small if we get one in stocks


A/D
- pretty bullish looking numbers...more so than it felt like...looks better than today's candle
- only bearish sign is the up volume on the NYSE...but it seems to be the least important indicator of the whole chart...
- hmm...maybe we can keep rising without a pullback...


Analysis: I still believe we will get a pullback...i am guessing tomororw as resistance is holding and we are at a 20MA on a majority of the charts i was looking at today in individual stocks as well as ETFs and indexes...today seemed like a good day to take profits as it was unable to make new highs today in the index charts..seems like the bulls will be taking a breathers as technicals have a bad risk / reward now at these levels...

Sectors:
best - fxi, eem, tan, kol, oih, mdy, iwm
worst - ung, uga, uso, gld, dba, uup, (slv, rkh, xme)

with commodities amongst the worst as well as financials, don't know how strong today's rally really is...but the strong guys have been very strong...mostly because of asian markets rallying huge overnight...but these charts are very overextended and at good MA resistance...double inverse FXI, FXP, shows just how good a time it is to go short the asian market...

RC's Trading Desk

- massive respect for a man who can manage 24 screens at one time...

10/29 - Market Analysis

SPX
- overall up day til the last few minutes where all the gains were wiped out from profit taking and ppl scared of tomorro'w GDP numbers
- 20 MA was probably the main reason most technicians sold into the rally...and thats the reason why i sold earlier and added a short at the EOD
- i think we will get at most 1 day of declines before we skyrocket again on friday...



NDX
- 20 MA was strong
- most technical of the charts to me..
- pullback here will be very healthy


XLF
- the culprit of all the resistance throughout the day and also of the selloff late in the day
- a nice pullback was made today..a small one tomorrow might be all we get from XLF
- any rally day where XLF doesn't not participate has very high odds of failing...


RKH
- same as XLF, just that 20 MA is very apparent here


USO
- finally! we broke out...i am so bullish!
- now, if we get the nice pullback i am thinking we can get in the indexes, USO might pullback to its trendline before rallying again...just make sure it doesn't close below the trendline


VIX
- closed right at resistance
- doesn't want to go down as the 20 MA again adds strong support
- overall though, it shouldn't be able to avoid the unavoidable toppling thats to come


A/D
- as i said, today is a bullish day..these numbers show it...
- looks very much like a bullish consolidation day...


Analysis: Commodities were the leaders today and financials were the weaklings...that makes for catchup from the laggards and consolidation from the leaders...which to me sounds very bullish..the strength and buying of the bulls today was very evident..it was only until the last few minutes was it unable to fight off the bears...definitely having more bulls than bears...so listening to the charts, a decline tomorrow either for part of the day or for the whole day is expected...but in the intermediate term, this rally will continue...

Sectors:

best - gdx, xme, kol, ung, slv, dba, uga
worst - xlf, smh, rkh, xlk, fxi

- damn i wish i had some of the commodities today...their huge moves off 52 week lows was incredible...now we can say that we will have a broadbased rally...all the commodites of course was waiting for USO to confirm strengh and we saw that in the daily chart...looking forward, everything looks bullish and a slight pullback of all the sectors especially the best sectors of today will mean for cherrypicking time...

R.C. Market Report 10.29

• Market Trend: Neutral

• The theme of today's trading was unexpected steadiness. I had expected some profit taking during trading hours prior to Fed announcement but the market not only held but added some to yesterday's gain. Even during few moments of selling, things seemed very steady. Then as the annoucement was made to cut the rate down to 1%, the following reaction wasn't volatile. We sold off on the annoucement but ever so gently compared to the type of action we've been having lately. The market made another move higher afterwards but got hit by a large selloff in the final ten minutes. But even that selloff, a combination of profit taking and an erroneous news out of GE, was tepid compared to the 1200pt rise since yesterday. I'm sure you can make a bearish argument with the late selloff and lack of volume today but I'm going to put a positive spin to it. I believe we'll move up from here. I don't believe yesterday was a fluke. A push up to end this week would be ideal for further bullishness.

10/28 - Market Analysis

SPX
- nice breakout today on mediocre volume
- resistance near


NDX
- same chart as SPX basically
- just that we get a longer term trendline resistance right on the close


30" QQQQ
- from judge the daily chart, today's action does nothing for the intermediate trend
- but zooming in, we can see how huge today's breakout was...
- the range trading finally had a breakout...and that was my buy signal...


XLF
- i had 3 signals to confirm a bullish rally to come
- XLF breaking the down trendline is #1


VIX
- the breaking if support on the VIX was signal #2


USO
- my last bullish signal, and probably the most important, was a breakout of the USO downtrend...
- we didn't get that..so we are 2 of 3 indicators...until we get this breakout, i can only be cautiously bullish and feel that we will selloff hard soon



A/D
- overall a bullish chart BUT doesn't seem to show a 10% move in SPX huh?
- the declining issues are much more than i expected from such a huge rally
- watch also the new lows as there were plenty of those
- A/D telling us to stay somewhat cautious


Analysis: The charts are telling me that today is more a buy the hype and sell one the news kind of deal...if we get a nice rally tomorrow morning, i would feel happy to sell my long position...the A/D and lack of participation in the USO suggests to me that today were rumor buyers who think that the possible FED meeting tomorrow will bring about a reversal catalyst...we haven't had 2 days of consecutive advances in a very long time, so if we can manage to do that and have USO breakout, i will be much more on board with the bulls..for now though, i have a bad feeling about this rally and see many reasons to want to fade it...asian markets seemed to have affected today's open...lets see if it does the same tomorrow as i expect the asian market to rally huge yet again...oh yah...and just so u know what i am playing technicals here, i do like a very good first profit taking at the 20MA on the indexes...i would feel good going into cash there and reloading on a pullback.

Sectors:
best - fxi, eem, xme, xlf, xlb, xlk (all rose 13% minimum)
worst - uup (dba, uga, gld, ung, slv, uso, tan, xhb, pph)

- definitely seems like the best performers were the ones hardest hit from october's onslaught...the worst were the ones that are dollar related...which kind of tells me that they dont' believe tomorrow's rate cut will help in terms of demand in commodities...thats kind of scary to me...

R.C. Market Report 10.28

• Market Trend: Neutral

• We had a powerful rally today. Although overall volume wasn't spectacular, buying volume kept increasing as the day went by. I'd like to see a followthrough in the coming days with solid volume, but a pullback before the next rally maybe the healthier route to take. Tomorrow, we have Fed announcement and I'd be wary of being long or short before the annoucement. Let the news hit the wire and the ensuing volatility to settle down first. Then evaluate the market at that point.

• The day opened unusually strong, signaling that the market has the potential to rally big when the time is right. Then as we gave away all of those gains in about an hour, bears relaxed, assuming that it's just another failed rally attempt. The bears needed to really pound the market at that point to avoid what ended up happening to them. As a bull, you'd be asking for too much if you didn't take profit near the close. Eventhough this could be the start of a much bigger rally, anytime you see the chart go vertically straight up like that, you have got to take profit. There will be another opportunity to get long in the near future.

10/27 - Market Analysis

SPX
- yup...keep holding those shorts
- late day selloff killed all hopes of a rebound



NDX
- need to break that resistance to move anywhere higher


XLF
- one of the stronger sectors
- earlier in the day, it was XLF and RKH leading therefore i thought we might get the first of reversal days but that all changed with the EOD selloff
- watch levels for possible support


USO
- just like the markets, it closed right at its lows...
- very pitiful but great for any shorts that were brave enough to hold throughout all this bottom picking speculation...


VIX
- vix has good support below now...sky is the limit from here


A/D
- for the most part confirms today's weak close
- but again we have bullish volume divergence in the NYSE...not enough to go long from this but enough to think there might be a (slight) chance of a rally soon


Analysis: very boring day...and i really didn't know what to make of the action intraday...luckily, i decided lately to just exclusively do my daily analysis based on daily charts (without the distraction of news and contrarian thinking, etc ) and that has definitely made it much simpler when evalutating the market...overall, its clear, we are falling and still falling...nothing tells me that now is the time to buy...nothing says that its the time to cover shorts...everything points to bearishness...until the daily charts change, there is no reason why this trend follower will change views...

Sectors:

best - dba, gld, uup, (smh, xrt, slv, xlf)
worst - tan, fxi, kol, xme, xlb

sectors making sense...most bullish thing is that xlf was able to stay relatively safe throughout the day...it ended the day down 1.7% which is definitely not bad as SPY fell 3.73%. watch it for relative strength as they need to lead the next rally if we ever get one...until then, keep shorting what works...i saw some energy stocks making breakdowns of their descending triangles...

R.C. Market Report 10.27

• Market Trend: Neutral

• Not much to say about today. We had low volume and traded in a range for all but last ten minutes of trading. It's noteworthy to see it drop so much in just ten minutes but it didn't really change the overall picture of things. So I won't give it too much credit here. Just another day in the market, and hopefully tomorrow will bring more trading opportunities than today.

T. Boone's Advice

Got this from a good friend of mine...

Excerpted from the latest issue of Success Magazine
(http://www.success-digital.com/success/200811):


Eighty-year-old billionaire T. Boone Pickens sees today's times as the
next big boon for entrepreneurialism. Here are seven ways you can
follow Pickens' entrepreneurial mindset - even if your bottom line
doesn't include drilling for "Texas Tea."

1. TAKE A LONG VIEW. "To make the big money, I've found it's best to
take a long-term view, stay focused and not get spooked by the
temporary fluctuations in the market. When I have the odds in my
favor, I put my money up and keep it up. If the fundamentals change, I
get the hell out of there."

2. LEAD BY EXAMPLE."You don't run over your personnel, but you don't
pump them up with false praise, either."

3. HAVE A PLAN."A fool with a plan can outsmart a genius with no plan."

4. MAKE THE CALL."Sometimes the window of opportunity is open only
briefly. Waiting is not a decision, although many people think it is.
Be willing to make decisions. That's the most important quality in a
good leader. Don't fall victim to what I call the
ready-aim-aim-aim-aim syndrome. You must be willing to fire."

5. BALANCE IT OUT."Work eight hours and sleep eight hours, and make
sure that they are not the same eight hours."

6. LEARN FROM MISTAKES."It's all right to get your fingers crushed in
the door, but don't let the same door crush them twice."

7. BE ACCESSIBLE. It creates goodwill.

10/24 - Market Analysis

SPX
- no reason to go long yet...
- breakdown..short!


NDX
- same thing...it broke down...off its lows and with light volume but a breakdown in a bear market is very much reason to expect more downside move than upside



RKH
- should keep falling til its 52 week lows

XLF
- at 52 week lows with the candle body
- might pose an area of support, but technically, we should expect this support to fail


USO
- downward channel is strong as hell...
- hold onto shorts in oil and shorts in SPX for dear life...
- as long as channel stays, any bottom pickers in stocks and oil will get slaughtered


VIX
- i was wrong...it brokeout instead of breaking down
- candle shows that this might still be a top..but as the trend is strong and up, just respect the breakout until it can close below the support


A/D
- consistent numbers to show a weak market...only thing is the volume in the NYSE is not so bearish....hmm...this is the most bullish thing i see in all these pictures




Analysis: Trend is down...no doubt about it...and since that is the case, any optimism brought on by psychological and fundamental or even astrological analysis should be discounted...with a stop above the breakdown level, and a bearish portfolio, you are set up for what the market is telling us. technically, friday brought out more reasons to be bearish, not bullish...trade accordingly...and good luck...don't respect the news or earnings as technicals are the most honest...

Sectors:

best - gdx, uup, gld (slv, smh, xlb)
worst - fxi, eem, kol, uga, xme, uso

as in the charts, asian stocks are doing the worst...i would think these would be the best candidates to short...while all energy are also game for shorting since oil continues to be at the bottom. relative strength with gold and gdx makes for a good calls to hedge shorts but i would not think these will be leaders if we are to rally...definitely they are more safety plays for the market in a downturn..

R.C. Market Report 10.24

• Market Trend: Neutral

• After today, I'm feeling a little bullish and a little bearish. Heading into the weekend with monday's open being a big question mark, I'm happy to be neutral and completely in cash. Market crashed in the pre-market futures and they halted trading. But as regular session got underway, market rallied off opening low and stabilized itself. Through rest of the day, market traded in a choppy manner within a range. During the last hour, it was extremely choppy and erratic. Market ended down eventually from day's high but I think people are thinking that it could have been worse.

• While my rational thinking rests on neutral grounds, I do have a theory for next week. I reemphasize the word 'theory' because that's all it is. After initial shakeout on Monday, in which ever direction they decide to push it, I think traders will prepare for the Fed meeting on Wednesday. And in anticipation of Fed's actions - an interest rate cut and/or second stimulus package - that may serve to end the slide and turn the market around, I think the market may rally into the release of Fed minutes. So Monday and Tuesday can be up. But after the Fed's meeting, selloff can begin anew, creating doubts about effectiveness of Fed's actions, and leave traders hopeless. That means, selloff late Wednesday to possibly Friday. And with Friday being the last day of year-end quarter, hedgefund liquidation will likely climax during the week as well. As you can see, I've made numerous assumptions to create this theory so we'll see how it all plays out.

• I read or heard from somewhere yesterday that whoever is left trading now is a real professional because the rest of the crowd has jumped off this runaway train. So if you are still in the game, I commend you on your persistency and vigor.

R.C. Market Report 10.23

• Market Trend: Neutral

• Early on, market tried to build on yesterday's late buying effort but failed miserably by midday. At the lowest price level, I started to think that we may be able to mark today as the turnaround day. And that sense of bottom being very near, spurred buyers to jump in and pick up equities in a hurry. It was as if the market took the stairs down but took the elevator on the way up. Overall volume was quite strong and upticks carried more volume than downticks. These are all bullish signs that should not be ignored or discredited. Nonetheless, by anticipating the reversal and putting money in early, these buyers prevented the market from reaching the inevitable bottom price level. Thus, ironically, the bottom pickers prevented the bottom from occurring today. I don't blame their actions, but merely note it as human psychology at work during a market bottom. With a rather strong buying effort today, it wouldn't surprise me to see it try and continue tomorrow. But whether it be tomorrow early on, late, or early next week, I don't think this is the rally that we'll build on. I expect this rally to fail. While the potential is now limited, it may be profitable to short it as this rally weakens for a very quick trade.

10/23 - Market Analysis

SPX
- trendless...holding support. no clear buy or sell signals...
- slight hints that with the volume indicator, we might rally slightly soon


NDX
- resistance very close
- held support


RKH
- stays below resistance and is holding the 62% retracement
- dunno where it will go but trend is still down


VIX
- fell back from after nice intraday gains
- now made a lower high?
- bearish candle...i think it will fall


USO
- still within the channel
- some strength as it rallied even though spx was down all day


A/D
- this shows that today's higher close is bullshit
- nothing bullish here to me..


analysis: trend is still down and is now slightly more neutral but still safer to stay short than go long...overall though, with no trends in anything and support and resistance nearby, i would say that its good to just stay sidelined...

sectors:
best - oih, xle, eem, xlu, uga, xlk
worst - tan, xhb, xme, kol, gdx

overall...random on strong and weak...seems as though the only rally was just ppl thinking bullish on oil...while all other commodity stocks get left behind...no favored sectors here...

10/22 - Market Analysis

Disclaimer: u know those times when u feel in the zone with charts...i felt that when i was doing these charts...hopefully its a sign that they are worth trusting...

SPX
- an intraday triangle breakdown, but not closing price
- more important to note is the volume and price...definitely not a breakdown yet when looking at that
- oh yah..i find that triangles are some of the least reliable patterns when made in such a short time frame

SPY 30"
- this highlights clearly what really happened today...the daily chart does not give the action at the EOD enough credit
- on this chart, the triangle pattern looks very beautiful...
- i'm a little confused with the significance of the late day retest of the breakdown on huge volume...



NDX
- surprise! its not the laggard today...i think thats all cause of the 4 horsemen
- during the day, when the market was very down, i glanced at my watch list and the only 4 advancing stocks were the horsemen...weird...leaders for if we rally? hmm...
- nice retest of the low close....volume i think is a very good bullish indicator

RKH
- broke down from the strong support...bearish
- at the bull flag's ideal pivot point...somewhat bullish hope
- better to short than go long...

USO
- don't dare start getting bullish about the market for more than a day or two unless this chart begins to break out of the channel..i would short any rally until we get a breakout...
- hints to more bearishness to stocks with no end in sight...


VIX
- impressed by how strong it has been
- still think the uptrend is broken though...tomorrow if it rallies, i might need to take this statement back...



A/D
- yup...confirmed that today is a true broad market selloff

Analysis: basically, i am getting mixed messages about the market...i would feel safe holding an index short but wouldn't feel safe enough to short a basket of stocks nor leave a long leash on the stops...i think the breakdown today in some charts is to be taken moderately serious...as we are in a bear market, its good to feel confident about the bearishness, but as we do have strong support left in some charts, it would be unwise to bet the farm going bear...

Sector:
best - uup, hhh, ung, qqqq, xlv, dba
worst - gdx, xme, kol, oih, tan, fxi

definitely it was the strongest rallied stocks from this very shortterm rally that got battered the most today...makes sense and confirms the retest of lows hypothesis...notice how its weird how DBA and UNG were the strongest of the weaklings today...thats divergence between the stocks and the commodities themselves....tech strong is also worth noting...

R.C. Market Report 10.22

• Market Trend: Neutral (error on yesterday's)

• With the market breakdown today, it looks as though we've completed forming the first leg of the bottom formation, whether it ends up being a W pattern or a head-and-shoulders pattern. The market sold off on larger volume than last few days and I believe we have at least one more day of selling left. One thing to note from today's action was the late buying bid that had volume behind it. In the near term, this late day rally will provide room for further sell off, but in the long term, this may be large institutional buyers coming in. If that's the case, we are very close a reversal. Watch the price level of Oct. 10's close because it seems likely to be tested again tomorrow. Time to buy longs isn't here yet.

R.C. Market Report 10.21

• Market Trend: Downtrend

• Today was a very frustrating day to trade. We were down, up, down, up, and a strong selloff in the final hour. Overall, the volume wasn't high but higher than yesterday's. It's hard to gauge what the market will do tomorrow but we haven't had a rally that hasn't failed yet. We really need to see an upday with good price action backed by solid volume, and/or a rally that extends for more than just one day. Until I see that happen, I'll remain slightly more bearish in my trades.

10/21 - Market Analysis

SPX
- triangle pattern really taking shape now
- real near breakout or breakdown point now as volume is near nonexistant
- target on the pattern means we can have a huge move very soon (calm before the storm)



NDX
- not so nice of a triangle
- tech is again a laggard


RKH
- might it be making a bullish flag?
- still above support so can't say that markets will fall just yet


USO
- trendline continues to be very strong
- a support is still held...lets see if it can provide a nice area to bounce off from
- still down so expect any market rally to fail, especially commodities


VIX
- struggled to try to break above the breakdown price but failed and made a doji
- maybe the MA below will turn out to be good support
- overall though, looks ready to topple more


A/D
- this continues to be a great indicator for the strength / weakness of market moves
- today looks quite bearish from this indicator

Analysis: overall trend is down, so any patterns should be looked at with a bearish bias. all rallies should lend good entry points for the next leg down and thats how we should look at the market. it would not be wise to get optimistic now as we are neutral and in a bear market, money is definitely in favor of the bears...best way to buy now are to short or go long stocks after price breaks out of the triangle pattern on strong volume...money on the table now is just very risky...50/50 if you ask me...

Sectors

best - slv, kol, uup, ung, xlv, rkh, xli, xlf (all virtually unchanged today)
worst - gdx, fxi, xlk, eem, uso, tan

- no huge percentage drops compared to other decline days...nothing in the double digits atleast...means today is kind of a consolidation or a small taste of a very strong fall to come...definitely a time to be safe and have right stops