a frustrated bull

You just wish we were in late 90’s, when SP 500 was highly tilted toward tech. But that was then, and this is now.  Today, the biggest component in SP500 is financials, so, when banks caught the cold, the broad market coughed.

 

First, bad news; we hoped that sp500 could hold above its 50 days MA around 1380, for a while, it was really hopeful. However, it was down fraction at the end, making it an indecisive day.  So, we can hope for another day.  Maybe we are entering a trading range with floor of the range around 1380.

 

DJIA fared even worse, that was the theme lately, big cap lagged small and mid cap.   

 

$VIX headed higher, so, we are embracing more volatilities. This was evident that the gains are hard to hold.

 

The good news is the timely rebound of tech and semiconductors. There lies our hope.   So, it will be the tug of war between tech bulls and financial bears, who will come winning is hard to predicate at this point.  Cautions are warranted.

 

However, with so much attention paid to financials and energies, maybe the malaise of the market will not be broken until we have some definite news from Lehman and such.

 

Maybe, for the time being, our stance should be day to day.  This is because, 1), volatilities are too high. 2). Market maybe news (rumor) driven.  

 

Steel are down across the board, ATI is at its lower bound, MTL below its 20 day MA but a few points higher than its 50 day MA.   JOYG, GGB and SID

 

Fertilizers are in a mode of breaking a triangle pattern (POT, MOS, MON and AGU).  They may fail back to the range.  So, be careful.

 

Coal (aci, jrcc, fdg, fcl, mee) coming from the recent highs, watch rebound of the group.

 

Solar is in trouble especially STP.

 

so, be careful and take profit as you can, and stay off line if it is necessary.