Market Discussion

kslifka · January 08, 2008, 05:06:36 PM

The market is in "spook" mode. Any bad news related to consumer debt is sending the market into to a tailspin.

Once the market closes it's eyes to this bad news and goes up...would be a good time to get in ...in my opinion. Either way...we should see a rally very soon....I mean the Nasdaq down 8 days in a row...when's the last time that's happened

One thing to watch for now are earnings warnings. This could really put the market into a tailspin.

It is nice to see CIMT green during this bloodbath.

BigSully1 · January 08, 2008, 05:19:42 PM

Quote from: kslifka on January 08, 2008, 05:06:36 PM
The market is in "spook" mode. Any bad news related to consumer debt is sending the market into to a tailspin.

Once the market closes it's eyes to this bad news and goes up...would be a good time to get in ...in my opinion. Either way...we should see a rally very soon....I mean the Nasdaq down 8 days in a row...when's the last time that's happened

One thing to watch for now are earnings warnings. This could really put the market into a tailspin.

It is nice to see CIMT green during this bloodbath.

Today it was another CFC bankruptcy rumor. (Could be more than just rumor)

I've already been negatively surprised by a few early reporters. Hope thats not becoming a trend. Are we already be in a recession and just don't realize it yet?

kslifka · January 08, 2008, 05:30:43 PM

Quote from: BigSully1 on January 08, 2008, 05:19:42 PM
Quote from: kslifka on January 08, 2008, 05:06:36 PM
The market is in "spook" mode. Any bad news related to consumer debt is sending the market into to a tailspin.

Once the market closes it's eyes to this bad news and goes up...would be a good time to get in ...in my opinion. Either way...we should see a rally very soon....I mean the Nasdaq down 8 days in a row...when's the last time that's happened

One thing to watch for now are earnings warnings. This could really put the market into a tailspin.

It is nice to see CIMT green during this bloodbath.

Today it was another CFC bankruptcy rumor. (Could be more than just rumor)

I've already been negatively surprised by a few early reporters. Hope thats not becoming a trend. Are we already be in a recession and just don't realize it yet?

I think the earnings will give us a clearer picture to the recession question. Right now the market is acting like "yes" we are in a recession or "will" be in one this quarter.

Having said that, I believe the market sometimes scares itself. Business' start cutting back and getting more conservative...because the stock market is telling them too.

David Randolph · January 08, 2008, 05:59:00 PM

Quote from: kslifka on January 08, 2008, 03:57:11 PM
Do you ever wish sometimes the market would just close...instead of selling off in the last hour.

Down 8 days in a row now with the Nasdaq. Hasn't happened in years.

Sometimes capitulation works out this way ... instead of a key reversal day you get a series of negative days.

This period reminds me of 2004, when the market had an 8 months correction. I remember when the market broke down below the horizontal supports and ...

... that was the bottom:

I guess that what we'll get now will be something similar ... perhaps we'll break down through the $137 support on a crazy gap down ... it will be extremely scary and almost impossible to hold on to your shares ... a year from now, with the market 20% higher, almost nobody will remember it, like almost nobody remembers the 2004 break.

This is my view of future events, I can be wrong.

kslifka · January 08, 2008, 07:23:04 PM

Quote from: David Randolph on January 08, 2008, 05:59:00 PM
Quote from: kslifka on January 08, 2008, 03:57:11 PM
Do you ever wish sometimes the market would just close...instead of selling off in the last hour.

Down 8 days in a row now with the Nasdaq. Hasn't happened in years.

Sometimes capitulation works out this way ... instead of a key reversal day you get a series of negative days.

This period reminds me of 2004, when the market had an 8 months correction. I remember I when the market broke down below the horizontal supports and ...

... that was the bottom:

I guess that what we'll get now will be something similar ... perhaps we'll break down through the $137 support on a crazy gap down ... it will be extremely scary and almost impossible to hold on to your shares ... a year from now, with the market 20% higher, almost nobody will remember it, like almost nobody remembers the 2004 break.

This is my view of future events, I can be wrong.

But didn't we already see a capitulation day not long ago in mid-August of 2007. I wouldn't think we would see another one so soon in a bullish trend.

Also, Fundamentally 2004 was very different than 2007/2008.

In 2004 the Fed was actually raising rates. (I had to go back and listen to a 2004 stock market review by NPR to remember what was going on back then because I don't really remember any big negative "news" items at the time.)

2004 was also the first time that the threat for rapidly rising oil which touched $55/barrel started to negatively affect the market...($55 per barrel would be a dream now.)

Fundamentally and the "feel" of this market reminds me somewhat of 2001/2002...minus the sub-prime mess now and the internet bubble of 2000. Companies were starting to lay people off and stopped spending money. Also, The fed was cutting rates.
Earnings warnings became a daily occurrence. Of course because of the tech bubble, in 2001 company valuations and earnings expectations were extremely high.

So while I don't personally believe we'll see the extreme market drop like we saw in 2001/2002....we will probably see some problems for the coming months.

I'm starting to believe the Fed will cut rates before it meets on January 30th. This will at least give a short term bounce in the market.

And, Yes over the longer term....the U.S. market always goes up.

stocky · January 08, 2008, 10:20:44 PM

Yes layoffs waves in the local economy is starting and I do know many specific instances but that could be true for CA I am not sure about other parts of US. It does feel like 2000 when a CS Professor told me to go learn something else other than coming to his Java class. I am no longer at School but was wondering what the Professors are suggesting now.

la-onda · January 08, 2008, 11:21:12 PM

from IV
Old Fool Notes - 01/08/08
Nasty and more nasty. The market apparently was just looking for an excuse to sell and they got it from some obscure comment by a T executive. Funny game we play in. The volume was 2.6 billion with a ratio of 4.1 to 1 in favor of the bears. That is a hell of a good ratio considering 59 points down - very efficient for the bears.
The daily chart shows the swift destruction to the down side. The indicators are all in control of the bears and there is no sign of relief.
The hourly chart is death for the bulls. There may be an oversold rebound but I would be careful chasing it. The bulls were trying to build a bottom pattern in the 2500 range but it failed on news. Nothing good here until we work back up to 2500.
The ratio chart bailed hard and is now in bottoming territory. But it is not screaming buy - so don't.
This will probably be the third week down on the weekly chart - further confirmation of tough times ahead. You will also note a hard cut through the lower Bollinger and it has been a long time since that happened. OBV has also crossed over and that is not good.
The Wilshire also cratered - just not as bad as the Naz. In fact, all of the broad market averages outperformed the NAZ. Interesting observation that you should keep in mind.
The P&F chart added 3 more Os and set a target at 2380. That's the spike down level from the low back in August. Maybe, maybe not.

No trades today. I was out all afternoon and got back about 3:45. Beside, since I largely missed the dump, I vowed not to get in until we had strong bottoming signals. Then I will be entering slowly because it looks like 08 is going to be very volatile. Great if you are able to day trade, but it doesn't look like I will have that luxury - at least for a few months. In any event, it looks like we may try 2400 on the down side. On the upside, I may try my luck at 2470 and 2490 - but not too heavy. 2500 is the key. I have a couple of tons of cash stacked up in the TP and LTP and I will be patient. The bull turn will come - but not now.

Charts link below - thanks for the votes - we need to stay ahead of the crazy Russian. LOL

http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID2071209

capricho · January 09, 2008, 12:47:25 AM

I believe that using historical comparisons to evaluate and analyze current market conditions is just plain folly. Each day and each year brings new and different factors that affect market momentum. Events in the past cannot possibly be a predictor or should be used as a basis for comparing what is occurring today. I am dismayed that 2008 has started off so lousy and is heading bearish and I don't see much upside potential right now.

tokyopua · January 09, 2008, 03:20:16 AM

Seems like the market is going to keep butting up against descending trendline resistance this year as finally there arent enough catalysts to push to new highs (in 2007 there was M&A, decent earnings, global expansion, and the "year before an election is always up" dogma), but enough bearish arguments exist now vs the one bullish global expansion argument to push down until we turn the corner on them (weak consumer, recession, credit crunch, subprime mortgages, $100 oil, etc.

I think its not a time to buy right now, but its OK to cut some losers that seem likely to lose more, and hold select stocks that seem unlikely to lose a lot even in a correction, and keep an eye out for when to go all in again. Luckily we have a great watchilst from among stocks in this portfolio, there are still some I didnt buy in the first place but remain great companies, just great companies in a bad market... this was what Buffett always looked for, a major firesale on good merchandise, seems we may get that this year sometime.

-------------------------------------------------------

Stocks Dive On AT&T Report Of Consumer Weakness
BY JONAH KERI

INVESTOR'S BUSINESS DAILY

Posted 1/8/2008

A bearish reversal slammed the stock market Tuesday after AT&T (T) reported "softness" on the consumer side of its business.

The Nasdaq started higher as it bounced back and forth most of the day. But the composite swooned in the session's final 90 minutes, slumping 2.4%.

The NYSE indexes also turned tail. The NYSE composite dropped 1.4%. The S&P 500 skidded 1.8% and the Dow industrials 1.9%. Small caps fared worst, as the S&P 600 dived 2.6%.

Volume increased across the board. Trading grew 3% on the Nasdaq and 10% on the NYSE compared with Monday's levels.

The major indexes appeared poised to build on Monday's rebound, as stocks ran out to early gains. Sellers erased those gains by midday, although bargain hunters returned and lifted the indexes back near the morning highs.

That all changed in a hurry when AT&T CEO Randall Stephenson warned of weakness in the company's consumer divisions. The company stands by its profit guidance. But it's disconnecting more phone and broadband customers who aren't paying their bills.

Already skittish over recession fears, Wall Street cringed at the AT&T news, sending stocks sharply lower right to the closing bell.

The session marked the eighth straight down day for the Nasdaq. The tech-laden index has now dropped 8% so far in 2008. The S&P 500 is down 5.3% for the year, the Dow 5.1%, the NYSE composite 4.3%.

Each passing day confirms the market's status: We're in a clear correction. The broad indexes have flashed multiple big down days in rapid volume. Leading stocks are faltering. Even recent market stalwarts such as Apple, (AAPL) Google (GOOG) and Research In Motion (RIMM) have slashed through key support levels, often in heavy turnover.

Intuitive Surgical joined the ranks of battered leaders Tuesday. The maker of robotic surgery equipment gapped down and lost 9% in above-average volume. Wachovia downgraded the stock before the open.

In this kind of climate, it's best to play defense. First and foremost, cut your losses short. Don't make excuses, or hope for a turnaround. You never know how long a correction's going to last, or how far stocks will fall.

Elsewhere, the National Association of Realtors said contracts to sell existing homes fell more than expected in November.

Rumors have swirled that ailing mortgage lender Countrywide Financial (CFC) could file for bankruptcy, though the company denied the speculation.

Also, Bear Stearns (BSC) said its chief executive is stepping down, as the investment bank deals with huge subprime mortgage losses.

la-onda · January 09, 2008, 03:20:46 AM

Houlahan · January 09, 2008, 09:51:38 AM

la-onda please forgive me! You must be laughing that I thought the market would bounce soon. This market acts like a woman. Moody and unpredictable. Sorry ladies.

Se7en · January 09, 2008, 11:31:46 AM

Quote from: Houlahan on January 09, 2008, 09:51:38 AM
la-onda please forgive me! You must be laughing that I thought the market would bounce soon. This market acts like a woman. Moody and unpredictable. Sorry ladies.

Garoh · January 10, 2008, 06:16:54 AM

I think at this point we reached a bottom for sure ...

I will go long today

David Randolph · January 10, 2008, 07:20:37 AM

Quoteplease check my links from my last posting, could be a rebound coming tomorrow

Quote from: Garoh on January 10, 2008, 06:16:54 AM

I think at this point we reached a bottom for sure ...

I will go long today

I don't know guys, maybe we're not done yet on the downside.

Bernanke will speak today and the market has been at work to question the FED's credibility and ability to take us out of this crisis. The final shot to the sentiment will be the complete distrust and loss of faith in the FED.

The technical guys will also lose faith when/if we break $137 to the downside.

I expect half of the weak hands to leave the market when this capitulation under $137 occurs.

The other half of the weak hands will feel extremely fortunate to have held on and will be glad to leave the market when the next rally towards the top of the current trading range occurs.

Only the few strong hands will be in the market for the 6-month long bullish leg that will take the SPY 10% above its current all time high, that is, towards $170 plus.

I expect this to push the Main up 30% plus for the year of 2008.

The market has its ways ...

David Randolph · January 10, 2008, 12:24:21 PM

Bernanke opted to say he's ready to cut rates aggressively. I hope "don't fight the FED" works and the current rally holds.

Got to go pick up my kids from school, have a nice day

3SOF

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Market Discussion

kslifka

BigSully1

kslifka

David Randolph

kslifka

stocky

la-onda

capricho

tokyopua

la-onda

Houlahan

Se7en

Garoh

David Randolph

David Randolph