Bearish On Goldman

GS. 170 seems like the next obvious target but I like it all the way down to 160. I don't like entering any trade that isn't elbows-to-assholes against its trendline, as tempting as it is, so I will try to show some patience here. Hopefully we see some sort of one day bounce or short-covering rally back to GS 180. This is just one example of a good looking chart but a lot of things broke down or continued to break down today. Ideally, many of these will come back up to the underside of their pre-existing support (now resistance) line, to provide a lot of low-risk setups.
Here are a few facts (in progress):
AAPL 160
GOOG 500
MA 260
GNK 50
CME 385
ICE 115
GLD brokeout
FLR brokedown
SOHU brokedown
POT pulled back to support

Trading for a Living
When the slope of MACD-Histogram moves in the same direction as prices, the trend is safe. When the slope of MACD-Histogram moves in a direction opposite to that of prices, the health of the trend is questioned. It is best to trade in the direction of the slope of MACD-Histogram because it shows whether bulls or bears dominate the market.

The slope of MACD-Histogram is more important than its position above or below the centerline. The best sell signals are given when MACD-Histogram is above its centerline but its slope turns down, showing that bulls have become exhausted. The best buy signals occur when MACD-Histogram is below its centerline but its slope turns up, showing that bears have become exhausted.

late afternoon sell-off

With the way the markets sold off this afternoon and with some less than impressive earnings after the bell, I would certainly expect tomorrow to be a down day. This 'oversold bounce' for that matter, may be shorter than expected. If not, I still don't expect it to last too long. All of the major indices continue to point downward.



























ACI















AAPL













CME















ICE
















CELG












GOOG















MA
















RIMM














SOHU















POT
















FLR














GLD














UNG














GNK









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SPY | RIMM | LEH | IBM | HAL | FLR | DRYS | DOW

Another close above 1400 today - a meaningless milestone. The S&P has been chopping through this level since April 28th so it doesn't seem to be as significant as once thought. While the roundedness of 1400 may get a lot of attention, perhaps the trendlines shown below will prove to be more significant.


Here are some more thoughts...









A lot of nice setups but some will require patience. I would wait for a small pullback in DRYS, for example, before going long. Same with RIMM (especially with what's happening in after hours). These are up 5.5% and 7% today respectively, so while the setup still looks nice it's probably not the best point for entry. DOW is also getting overbought (2 day RSI of 93.5). I'll have some specific trade suggestions as this week unfolds.

SPY | FLR | MMM | RIMM

Friday has left us overbought; however, a breakout scenario still seems imminent.

If (SPY) can in fact overcome 140 (should earnings continue to meet lowered expectations) 144 may be much tougher. To the right is a five year chart that helps illustrate why - basically 144 represents a key breach in an otherwise seemingly healthy 5 year trend.




Here is a
chart showing
the number of
S&P stocks trading
above their 200 day
moving average.



Below are some more stocks worth watching.

Fluor (FLR) - nice reverse head & shoulders pattern.
If this looks like a bullish opportunity to you, consider debit spreads or calls with an expiration of JUL or OCT and an initial price target of 170 (all-time high set back on Nov 26, 2007).









3M (MMM) - broke out to the upside and closed above 200 day moving average. Potential to revisit 86.







Research in Motion (RIMM) - might be getting ready to have another go at resistance.







Keep in mind some of these are currently overbought so you might want to be patient.


Here is a short clip I recommend watching. It provides a little insight into Dan Sheridan's thought process and how he might have played Google (GOOG) before earnings.
http://www.cboe.com/tradtool/webcast.aspx?movieid=36693&channel=1252