3:49pm
Remember, the trend in this market is higher. Don’t be scared of pullbacks. Embrace them. We bought some SSO down here. We could consolidate more tomorrow so don’t put a full position on just yet. A fakeout move under the ascending trendline is also possible. Stay tuned for today’s video.
3:38pm
The XLF is now down 5.5% for the day.
3:32pm
Market breaking down to new session lows. The ascending trendline sits around 1260.
3:00pm
The ES is approaching session lows (1271.25).
2:47pm
Weakness in financial are pressuring the market lower. AIG down 17%, FNM down 14% ahead of earnings tomorrow, LEH down 10%, FRE down 10%, MER down 9.5%,
2:39pm
The XLF is down 3.7% and has pulled back into its 50MA on the daily chart. Volume is light.
2:36pm
Today is shaping up to be exactly what we expected, a day of consolidation. After the close we see earnings from ACS, CLWR, CROX, HTZ and PCR. Tomorrow before the open: FNM, MBI and UFS report.
2:00pm
As oil recovers, the equities markets selloff. Oil is back into positive territory, up 60 cents.
1:41pm
Natural gas at a fresh 5-month low.
1:02pm
First hit of the 200MA serving as resistance.
12:48pm
Oil just went negative. Equities climbing. ES above 200MA.
12:36pm
Crude oil and nat gas at their lowest levels of the day. The ES is moving higher towards its 50 MA (1281.50) and its 200MA (1282.25).
11:55am
Nat gas UNG) has reversed lower and just dipped into negative territory.
11:53am
The US dollar rally continues today. The dollar index is trading at its highest level since Feb. 26.
11:10am
A quick note about the misleading 5.3% increase in pending home sales. June often sees a boost from May as families try to settle down before the next school year begins. This gain is due to regular seasonality, not any strength in the housing market. Pending home sales were down 12.3% when compared to June 2007.
10:35am
Nat gas moving higher after the inventory number.
10:20am
The ES will have resistance at the necktie of the 50 and 200 moving averages at 1283. Nat Gas inventories in 15 minutes.
10:12am
XLF down 1.7%: AIG down 15%, FRE down 5%, FNM down 5%, LEH down 4%, MER down 4%.
10:05am
ES testing its 20MA at 1280.
10:02am
June Pending Home Sales +5.3% v -1.0% estimate. Markets attempting to rally off the lows.
9:43am
The ES has broken below yesterday’s low, opening the door for continued downside. Here is a 60-minute chart of the ES. Notice the ascending trendline below around 1260, which coincides with the 20MA on the SPX daily chart. (click image to enlarge)
9:34am
Possible double bottom with yesterday’s low at 1275. The S&P could consolidate over today and tomorrow back towards the 20MA at 1260.
9:31am
XLF down more than 2% at the open. Energy names getting a lift with oil higher by more than $2 to 120.65.
9:25am
At this point in the rally, in the face of bad news on several fronts, the bulls only hope is for the market to pullback/consolidate and gather some energy for the next push. I would be shocked if the market stages a rally today.
9:16am
Good morning. S&P E-Mini Futures (ES) trading lower this morning by $8.50 after disappointing results from AIG, poor retail same store sales, and worse than expected jobless claims. Initial jobless claims came in at 455K v 425K estimate. The employment picture is getting worse and worse by the week.
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August 7th, 2008 at 9:29 am
Bought AIG premarket at 25. Looks like some support there. Hope for a bounce in first 30 minutes.
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August 7th, 2008 at 9:41 am
For those interested in IMAX, the stock is trading lower after disappointing results:
7:08AM Imax misses by $0.10, misses on revs (IMAX) 7.83 : Reports Q2 (Jun) loss of $0.29 per share, $0.10 worse than the First Call consensus of ($0.19); revenues fell 21.8% year/year to $21.2 mln vs the $25.1 mln consensus. At the same time, the co announced that the roll out of its IMAX(R) Digital system technology launched as scheduled, with the successful delivery and installation of its first three digital projection systems at three AMC Entertainment theatres located in the Baltimore/Washington D.C. area, during the second quarter. With respect to the third quarter, on July 18th, IMAX released Warner Bros. Pictures’ blockbuster hit The Dark Knight: The IMAX Experience which is currently showing on 94 domestic and 29 international screens. In its first 19 days of release the film has grossed approximately $32.0 mln worldwide, or $257,000 per screen, making it the highest grossing 2D Hollywood feature film in IMAX history and it continues to perform extremely well both domestically and internationally with several international markets still to open.
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August 7th, 2008 at 9:49 am
TSO consolidated back to it’s 10 minute 50 SMA, which also coincides with a 38.2% retracement from yesterdays move, but it might want to still go lower after NG reports crude.. what do you think craig.. buy it at the 50 retracement fo 16.50?
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August 7th, 2008 at 9:51 am
22.14 7/29 is the low of the swing point that AIG is making a run for thai……..watch that number and see the volume that it comes into…i don’t see a bounce personally. All the indicies we pushing higher with approx 30% lighter volume the last 5-6 days…..we are heading for the lows is my opinion
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August 7th, 2008 at 10:45 am
Hi Craig, which timeframes are you looking at intraday? 5 min 10 min 60 min? And which period moving avgs do you focus on? Thanks.
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August 7th, 2008 at 10:47 am
I use 10-minute candles, and I watch the 20, 50, 200 moving averages. I track the S&P using the E-Mini futures contract (ES).
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August 7th, 2008 at 11:03 am
TSO bounced off its 38.2% retracement level and also the 50 SMA 10 minute, but didn’t get enough bid to break the 20 SMA 10 minute.. i’m looking for a pull back to the 16.50 level which happens to coincide with a 50% retracement of the stock… any thoughts?
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August 7th, 2008 at 11:06 am
EMC looks very intresting as it is consolidating for a 4th day on light volume after 2 huge upward days… maybe we can get a break of the 50 SMA daily… look for some support on the 60 minute 200 SMA.. you can probably buy it there for a nice breka out higher.. (keep track that the volume on this downard drift remains light)
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August 7th, 2008 at 12:00 pm
Craig, why is a double top in the dollar (uup) and a bottom on gld not an option?
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August 7th, 2008 at 12:02 pm
Sal, that is certainly an option.
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August 7th, 2008 at 12:03 pm
Re IMAX:
I listened to the conf. call by IMAX execs. They are very upbeat. A number of positive articles came out on IMAX recently [Kiplingers, Marketwatch]. The upbeat tone on the call seems to justify all the optimism. Dark Knight ($32 million revenue in 3 weeks) gave them the kind of visibility needed for major studios to invest in doing a parallel IMAX production. One extra tidbit I gathered from the call is that IMAX joint venture partners (movie chains) are hastening the IMAX projects so that they can capture share of the next big IMAX release (late Sept). I am not sure how the stock will trade in the near term. But come October-November, I expect this stock to be a teenager. [July 15 short interest is about 3mil shares and the short cover ratio is about 20.]
-Mohan
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August 7th, 2008 at 12:12 pm
Forgot to mention this earlier:
Full disclosure: I have a sizable stake in IMAX (a position trade which I could hold for months)
-Mohan
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August 7th, 2008 at 2:43 pm
ok guys I just shorted LCC @ 6.89. with a stop at 7.12.
Any opinions if oil will go up 2marrow and where airlines are going i think they have had too much of a run and now are seeing resistance last few days
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August 7th, 2008 at 2:46 pm
Roop, its a tough call. Oil is due for somewhat of a bounce, but calling the bottom is difficult. The USO has found a floor at 95.11, gap window support. And many of the airlines have formed double tops. Your trade sounds like a good idea, with a tight stop.
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August 7th, 2008 at 2:48 pm
Gold - is sitting at the year’s low. If it breaks down, it will fall to 810 which was the basing area in late 2007 just a month after the market topped, for the run up to over 1000+ earlier this year. If this happens, some of the outflow money will find a home in equities.
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August 7th, 2008 at 3:02 pm
This is not looking anymore like consolidation.. it’s actually starting to look like a double top at 1291, and maybe even a break of the ascending line… we’ll have to see..
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August 7th, 2008 at 3:35 pm
Craig, what are you thinking… buy at the 20 SMA daily of the SPY ?
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August 7th, 2008 at 3:38 pm
We see the sell off that we wanted. Up day tomorrow.
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August 7th, 2008 at 3:41 pm
Idan, I think starting to build a long position here is a good idea.
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August 7th, 2008 at 3:56 pm
Yeah… maybe but we see a bounce here at the end, this could bring some more sellers in tomorrow for continued consolidation,
TSO now breaking the 38.2% retracement, i’m liking what I see.. i’m buying this one at 16.50.. beautiful consolidation..
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August 7th, 2008 at 3:59 pm
I would also like to add to Craig’s comment.. you can also draw the ascending line so that it’s actually sitting at 1255-1256 and not 1260… so just remember that this is an art and not a science, and that you should be buying at 1255, and not selling, unless we have 2 consecutive closes at that level.
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August 7th, 2008 at 4:01 pm
SP500 - It looks like the ascending trend line served as obvious support. The penant is narrowing by the day. Tomorrow it will be ~1262 to 1291. Less than 2.5% range based off of the 1200 low. The pot is boiling.
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