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MARKET WRAP UP 08/23/10
With the beginning of the end of summer trading commencing this week, the market stayed to its script of chopping up both bulls and bears. After several uninspiring attempts at a rally today, the S&P 500 sold off into the closing bell to finish down 0.40% to 1067. As has been the norm, volume was tepid and breadth was weak. The good news for the bulls is that we did not take out Friday’s lows of 1063. However, the bad news is that we closed on the lows of the day, and we are still dangerously probing multi-month support levels.
The updated and annotated daily chart of the S&P 500, seen below, should illustrate these points.
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The daily charts of the other key indices and sectors also continue to tell the story of the bulls tempting fate, in the form of dancing on significant support levels.
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With the market acting weak at key support zones, I have one eye on the exit doors with respect to the longs in my portfolio. The nature of this market has been to punish bulls who anticipated big upside breakouts, as well as bears who shorted at support, looking for a breakdown. The essence of a trading range is to reward traders who resist the urge to extrapolate that weak price action will beget more selling, and vice versa for rallies. In other words, fade the prevailing sentiment. Right now, sentiment is poor, and traders are frustrated and just about ready to give up on this market. It will be interesting to see if we find support here and stay within this tight trading range.
If we do not, the stampede towards the exits will be deafening.
ROFL AWESOME Latte ART!!
Well tomorrow is “turnaround Tuesday” so the markets have that going for them, which is nice. (obscure reference)
Your post titles today were cracking me up all day.
Caddyshack quoting does not qualify as “obscure referencing.”
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LOL, Italian coffee with a skull and bones, I like that!
Yep, I’m feeling a tad jiggy about some of my longs right now…
Awesome stuff as usual , all about 1060 SPX for me my man. 107.10 SPY held but was lost AH’s, Probably a nice gap-down in the AM to gobble up.
morning chess! im with the goat on this one,looking for a gap-down to gobble up a few shares of my favs.
ty, good sir
ANV is strong as can be. I want to get short, but gold just doesnt stop.