主题：02/25/2009 Market View -- 宁子
家园 02/25/2009 Market View SUMMARY:
- Fooled once, fooled twice and yet a third time. Market again jilted on bank bailout plans.
- Existing home sales continue their decline faster than expected.
- Gasoline prices set to jump back up as inventories fall.
- Market still trying to get some traction for a continued bounce off support.
Another bailout announcement, another surprising lack of substance.
The session started weaker on the heels of the Tuesday bounce. Not bad to start a bit softer but that requires a market with some strength. That is a wide open question right now with all of one day of a rally off the SP500 November low.
There was some help. The EU announced a coordinated bank plan. The UK said it will have a firm plan in place by Friday. Sounds hauntingly familiar. After the Obama speech many brokers and traders we talked to were glum at the prospect of more spending, taxes, national healthcare. Some people take offense at mentioning this, but it is a fact that many floor traders and brokers are worried about what is to come and they play a big role in the market activity on any given day. Bernanke was speaking again but it was a rehash of Tuesday. There were plenty of news items, but nothing positive enough to energize stocks out of the gate.
A choppy session that wasn't helped by NT announced 3200 layoffs in addition to the 1500 previously announced. After making a higher low near lunch, however, the market rallied into the last hour. The word of another bank bailout press conference helped rally gin up the move. In the last half hour it lost its nerve, likely guessing that little substance would emerge yet again. Its guess was correct. Nineteen banks would undergo a stress test then have six months to flush up the reserves if needed. You wanted specifics, you didn't get them.
The market was positive but then sold off ahead of the close leaving only SOX positive. The market is desperately searching for some clarity with these bank issues, but it is not getting it. What it is getting is an idea that there is not a clue of what to do about the problem and that is why it is taking so long. It would be far better to avoid having these press conferences and announcements where there is nothing to discuss or announce. The people and even the markets want to believe that the government is up to the fix, but nearly everyone we talk with has serious doubts even with the lofty rhetoric of late. No one wants the mistakes of the TARP with its cram down similar to the spending bill cram down, but there has been enough time for a real plan to emerge. Heck during the hiatus several decent ones have been trotted if you accept spending hundreds of billions more. As that appears to be the case then there has been plenty of time to take the best elements of some good plans from very smart people and meld them into a real plan that we can all get behind.
While we wait, however, the credit markets remain frozen (LIBOR 3-month ticked up again to 1.26%) and every day that occurs more economic damage is done. Confidence is down to 25 as consumers bottle it up across the land. Even worse, businesses are falling left and right, unable to get credit at reasonable rates. Congress is going to be shocked, or not, when it goes to raise taxes and finds there is not much to tax.
TECHNICAL. Intraday the action started soft and strengthened. There was no straight rally higher as the action was quite choppy, but a series of higher lows propelled the indices to positive and session highs in the last hour. Then the bearish action appeared and took the indices negative with a sharp late selloff. The bulls are still too few and too nervous.
INTERNALS. Volume was still solid even if it was mixed with NASDAQ edging higher and NYSE slipping modestly lower. Breadth definitely slipped, and even with the late selling NASDAQ breadth was quite negative (-2.6:1). The action was a little more corrosive than the action suggest.
CHARTS. There was no real movement. After jumping off the November low Tuesday SP500 lost some ground and NASDAQ to hold its December low. Tuesday was an inside day on NASDAQ, and the Wednesday doji did little to clear up the picture. Same with SP500; it held its move off the November low but made no significant headway. Same with the small caps. Unable to put together a strong move here, but there is high volume as the indices hold over support. That can suggest some accumulation as buyers step in and keep stocks from falling below those key levels. And once again, the indices are holding over in their consolidations. Some positives but the indices still have to show a follow through starting Friday or early next week. In the interim they have to hold on and let some leaders come back such as the chips.
LEADERSHIP. The chips posted gains on higher volume Wednesday. Perhaps they ARE trying to make a comeback. They still need work. China still looks good. Even some retail look solid. Techs bounced, but as with chips, they need more work to recover. There are stocks here and there breaking higher, but after the 2 weeks of selling a lot of the leadership and budding leadership was fractured. Sure there are stocks that are set up to move higher, but they are scattered across many sectors without the kind of breadth and depth seen before the selling. It takes work to get back after that kind of selling.
家园 THE ECONOMY Existing home sales fall 5.3% after a December 6.3% gain.
At 4.49M units that is the lowest level since 1997. There was a rise in sales out west, but that is due to the foreclosures in that area. Is that a bad thing? No. The market is working to clear up the mess as prices fall to levels that attract buyers. That area is going to clear up faster than many as the housing bill is going to slow the process elsewhere and keep housing prices artificially higher. Anyone who reads a history book knows what happens when we try to maintain prices above market levels. It could be wheat, milk, frozen concentrated orange juice, cars, houses. Anything. Eventually the pressures build to the level the market breaks through even the supports.
The median price fell 41.8% as 45% of the sales were distressed sales to start the year. Prices need to fall. Unfortunately because sales decline inventories rose to a 9.6 month supply, up from 9.4 in December. That is still below the peak at 11 months in November.
Gasoline prices set to rise.
After a brief 2 week respite that saw prices soften, expect to see rising prices soon. While oil inventories climbed 717K, that was less than expected and fueled an oil rally (42.40, +2.34). Gasoline inventories plunged 3.32M bbl. The wholesale price jumped and the crack spread for refiners improved. Looks as if the only ones going to make out well on this one are the refiners.
家园 THE MARKET MARKET SENTIMENT
VIX: 44.67; -0.82
VXN: 43.95; -0.1
VXO: 45.62; +0.41
Put/Call Ratio (CBOE): 0.85; +0.06
NASDAQ
Stats: -16.4 points (+1.14%) to close at 1425.43
Volume: 2.395B (+0.78%)
Up Volume: 845.062M (-1.231B)
Down Volume: 1.536B (+1.251B)
A/D and Hi/Lo: Decliners led 2.34 to 1
Previous Session: Advancers led 2.59 to 1
New Highs: 1 (-6)
New Lows: 134 (-168)
NASDAQ CHART: http://investmenthouse.com/ihmedia/NASDAQ.jpeg
After the Tuesday bounce off the test of the December low NASDAQ could not get any traction. It tapped at the low on the session low and at the 10 day EMA on the high. Showing a doji but that does not mean much right here. NASDAQ remains in its consolidation but it will have to show more strength or even a run at 1500 will be hard to pull off.
SOX (+3.08%) posted solid gains. After selling below its January low, however, it has an ugly pattern to deal with. It is bouncing up in its 11 week trading range but it has a lot of overhead supply. It tapped the 50 day EMA on the session high and lost half its gains by the close. With many individual patterns in the same position, SOX has its work cut out for it as well.
NASDAQ 100 CHART: http://investmenthouse.com/ihmedia/NASDAQ100.jpeg
SOX CHART: http://investmenthouse.com/ihmedia/SOX.jpeg
SP500/NYSE
Stats: -8.24 points (+1.07%) to close at 764.9
NYSE Volume: 1.801B (-2.23%). Lower but still very strong trade as SP500 held its November low. That can indicate buyers stepping in to pick up shares as fast as the sellers unload them. That can be positive churn that leads to a bounce higher. Not many believers in that right now, however.
Up Volume: 671.061M (-1.04B)
Down Volume: 1.11B (+984.672M)
A/D and Hi/Lo: Decliners led 1.64 to 1
Previous Session: Advancers led 7.68 to 1
New Highs: 2 (-2)
New Lows: 102 (+36)
SP500 CHART: http://investmenthouse.com/ihmedia/SP500.jpeg
A tap lower to the November closing low and a bounce to positive . . . that could not hang on. SP500 bounced from the bottom of its November selling and is trying to gain some traction as it holds over that level on high volume. As noted, that can be a positive churning. Lots to prove here but it has made the initial step of holding the lows. Now it has to build into another move higher and that will take some time once again. Time is not bad as that is what the market needs to resurrect some leadership and build a better base. The odds are against it at this point, however, so we have to be patient for the upside to develop and look for opportunity with SPY, etc. if things turn back lower. Some key financials remain solid (GS, MS) but they don't carry all of the financials with them.
SP600 (-2.37%) continues to wallow but it also is holding above its November lows by a few points. More bearish pattern than SP500 and NASDAQ, and as you know, small caps rely on the economy and are a canary for it. That canary continues to gasp, but SP600 is set up to bounce in an oversold move.
DJ30
DJ30 is holding the lows hit Monday, trying to work laterally and put in some kind of support level here. The transports look very weak, however, and that is an anchor on the Dow. On any market bounce we are watching DJ20, the transports, to see if they fail at the 2750ish range as a rollover by those stocks will take the Dow lower as well.
Stats: -80.05 points (+1.09%) to close at 7270.89
Volume: 450M shares Wednesday versus 468M shares Tuesday.
DJ30 CHART: http://www.investmenthouse.com/ihmedia/DJ30.jpeg
家园 THURSDAY Durable goods, jobless claims, new home sales, and reaction to the latest vague outline of a bank bailout plan. Foreign markets are mixed tonight with Asia showing the Christmas colors, i.e. green and red.
At this juncture the market is feeling its way along. A two week selloff left stocks oversold and the indices at key support. They bounced. Wednesday they could not carry that bounce any further though they did not roll over. The market started a new rally attempt and it has to try and put some more into it starting any time but definitely by mid-week and without giving up any significant ground and it cannot do so on higher volume. The oversold condition remains, but we know that they can remain and indeed increase at their own whim.
Thus we have to be very selective on the upside and indeed we are doing that with some excellent stocks picked up of late that are in sectors that show good patterns that survived the selling and that are moving higher. China, select financials, some oil services. We want to see more leadership set up as that would bolster a market bounce attempt, but that will take time. That means caution on entering the upside.
It also means we need to be ready for the downside if this bounce suddenly craps out. As primed as the market is to bounce after the selling, it can still tumble further with SP500 and SP600 taking out their November lows. That would be a true sign of weakness to fall without any further bounce, but if the market has lost confidence in the Administration's ability to deal with the financial crisis that is exactly what will happen. Thus some more SPY downside and some other downside will have to be considered given the upside is tenuous and the last group of really solid formations for upside move saw few survivors after the selling. As noted above there are many fine stocks in good position, but not the groundswell that appears at the start of the month.
Thus we need to be choosy as we have been of late with the upside and just be ready to move in with the direction the market moves. It is extremely difficult divining direction with the government and the threat press conferences overlaying every market move. You can see the patterns set up and then the government says something positive, something negative it thought would be positive, or just downright negative. That is why traders are adamant about getting the details of the bailout plan whatever they are because at least then they can take positions depending upon whether it is good, bad, or is crap.
Support and Resistance
NASDAQ: Closed at 1425.43
Resistance:
1428 is the mid-November 2008 low
1434 is the January low (1440.86 closing)
The 10 day EMA at 1459
1460 is the February low
1493 is the October 2008 low & late December 2008 consolidation low.
1521 is the late 2002 peak following the bounce off the bear market low
The 50 day SMA at 1526
The 50 day EMA at 1527
1536 is the late November 2008 peak
1542 is the early October 2008 low
The 90 day SMA at 1544
1565 is the second low in October 2008
1569 is the late January 2009 peak
1603 is the December peak
1620 from the early 2001 low
1644 from August 2003
1666 is the January 2009 peak
1752 from 2004
1782 from August 2004
1786 is the November 2008 high. Key level.
Support:
1398 is the early December 2008 low
1387 is the 2001 low
1316 is the November 2008 closing low
1295 is the November 2008 low
S&P 500: Closed at 764.90
Resistance:
768 is the 2002 bear market low
The 10 day EMA at 787
800 is the March 2003 post bottom low
804 is the low on the January 2009 selloff
The 18 day EMA at 805
812 is the February low
815 is the early December 2008 low
818 is the early November 2008 low
839 is the early October 2008 low
The 50 day EMA at 846
848 is the October 2008 closing low
853 is the July 2002 low
857 is the December consolidation low
866 is the second October 2008 low
The 90 day SMA at 871
878 is the late January 2009 peak
889 is an interim 2002 peak
896 is the late November 2008 peak
899 is the early October closing low
919 is the early December peak
944 is the January 2009 high
Support:
752 is the November 2008 closing low
741 is the November 2008 intraday low
722 is a December 1996 low
673 is a June 1996 peak
Dow: Closed at 7270.89
Resistance:
7282 is the October 2002 closing low in the prior bear market.
7449 is the November 2008 low
The 10 day EMA at 7506
7524 is the March 2002 low to test the move off the October 2002 low
7694 is the February intraday low
7702 is the July 2002 low
7867 is the early February low
7882 is the early October 2008 intraday low. Key level to watch.
7909 is the early January low
7965 is the mid-November 2008 interim intraday low.
The 50 day EMA at 8138
8141 is the early December low
8175 is the October 2008 closing low. Key level to watch.
8197 was the second October 2008 low
8419 is the late December closing low in that consolidation
The 90 day SMA at 8432
8451 is the early October closing low
8521 is an interim high in March 2003 after the March 2003 low
8626 from December 2002
8829 is the late November 2008 peak
8934 is the December closing high
8985 is the closing low in the mid-2003 consolidation
9088 is the January 2009 peak
9200 is the July peak in the 2003 consolidation
9323 From June 2003 peak
9575 from September 2003, May 2001
9654 is the November 2008 peak
Support:
7197 is the intraday low from October 2002 bear market
7008 from February 1997 closing peak
6489 from December 1996 closing peak
Economic Calendar
These are consensus expectations. Our expectations will vary and are discussed in the 'Economy' section.
February 24 - Tuesday
Case/Schiller Home Price Index, December (9:00): -18.5% actual versus -18.25% expected, -18.20% prior
Consumer confidence, February (10:00): 25.0 actual versus 35.0 expected, 37.7 prior
Bernanke Monetary Policy Report (10:00)
February 25 - Wednesday
Existing home sales, January (10:00): 4.49M actual versus 4.79M expected, 4.74M prior
Crude inventories (10:35): +717K actual versus -138K prior
February 26 - Thursday
Durable Goods Orders January (8:30): -2.5% expected, -2.6% prior
Durables ex-Transportation, January (8:30): -2.2% expected, -3.6% prior
Initial jobless claims (8:30): 625K expected, 627K prior
New home sales, January (10:00): 324K expected, 331K prior
February 27 - Friday
Preliminary GDP Q4 (8:30): -5.4% expected, -3.8% prior
GDP Chain deflator, Q4 (8:30): -0.1% expected, -0.1% prior
Chicago PMI, February (9:45): 34.0 expected, 33.3 prior
Michigan sentiment, revised February (10:00): 56.5 expected, 56.2 prior