Thursday, October 2, 2008

Eid Mubarrak....

0830hrs: As was expected - Asia opened and is trading red. As of now Nikkei down 1.4%, Hang Seng Down 2% and Strait Times down 1.4%. There may be a small chance that the markets recover to the flat line by the time we open. Crude down to 93$ a barrel.

0600hrs 03 Oct 08: So the US has ended on an average 4% down. The party seems to be over for good for US. The moot question that remains is - how long are we going to take the cues from US and keep dropping? As of now Asia has not opened - not that anything positive is expected out of markets here - but all the same....

02 Oct 08: WOW what a day I had. A true day off in middle of a week. Infact it is not a bad idea to have a holiday in middle of a week. Its rejuvenating - to say the least. As if there were not enough reasons for the markets to fall - the Global markets are once again down in dumps - and they are ready to pounce upon us the moment we open. The reasons? ... Unemployment data and the factory reports, no that is not end of it - couple this with jobless claims in US that are on a seven year high. The general feeling there - I believe is that the financial rescue plan may not be good enough to ward off a recession.

AP reported that "investors appeared to be pulling more money out of the market and settling in for a prolonged economic winter. The main concern is that the $700 billion bailout plan won't be enough to stimulate growth, and the latest economic reports delivered on Tuesday demonstrate that the economy continues to struggle.
The government said the number of people seeking unemployment benefits rose last week and that demand at the nation's factories has fallen by the largest amount in nearly two years. The market is interpreting the Commerce Department report on factories as a sign that tight credit conditions are hitting manufacturers."

Even with the above the Asia was in a hangover perhaps and still not privy to this news. So only Nikkei was down 1.88% but both Hang Seng and strait times were up 1.08 and 0.20% respectively. Well this is where the good news ends. FTSE opened flat - climbed well into green but by mid session it was way down in red and finally ended 1.8% red. Dax and Cac followed exactly the same pattern and ending 2.51% and 2.25% in red respectively. US meanwhile opened along the flat line - in red but almost immediately started falling and presently around the mid session. Dow is 2.4% red, Nasdaq down 2.9% and S&P 500 both down 2.9 and 2.8% in red.

On the candles - harami did work its magic for all its worth. For the first day after a fairly long time the Bollinger bands constricted a little bit. The candle also left the bottom to end above the lower band line - moving away from it. The only problem was that this small white candle was what can be classified as a spinning top. I feel that a small explanation of the "Spinning top" is called for. Firstly, Spinning top candles have small real bodies, and they portray a stock or index plagued by uncertainty. The spinning top has small upper and lower shadows. Secondly, Spinning top candles portray situations where the market is having difficulty coming to a consensus on a security's value. They are indicative of a market in which uncertainty and indecision prevail. Neither the buyers nor the sellers have a clear sense of which direction the market will head. The forces of supply and demand are equally balanced. In the spinning top candle, the shadows are relatively small and the candle has a very small range. When combined with low volume, traders may be expressing disinterest in a particular security. And lastly, As the old cliche goes -- "when in doubt, stay out." The spinning top candle expresses doubt and confusion on the part of the market. Until the situation becomes clear, traders should emphasize careful stock selection and minimize position size.

The MACD divergence remains exactly the same as before and so does the red line that remains below the blue line. Mass Index is almost perfectly poised not to give a mid term bearish pattern. TRIX is looking down showing negativity. RSI too is negative. It is only Slow Stochastic that is giving a ray of hope and giving a buy signal. Trust it at your own peril.

Now some other good news. Crude down 94.65$ and weaker rupee. Well the weaker rupee is the good part for the exports and crude would be good for our economic engine in general. See the crude is going down on the pretext that the US in recession will lower the demand for power - so we are in middle of nowhere where on thing leads to another and not necessarily in the dame sequence.

I am waiting for the opening of Asian markets to open and will try to update tomorrow morning.

For the technically inclined.


R3 4139
R2 4076
R1 4013
Pivot 3937
S1 3874
S2 3798
S3 3735

Projected High range 3975 to 4045
Projected Low range 3955 to 3886

Fib Projected high 4038
Fib Projected low 3823



Anonymous said...

Today There will be GAP DOWN opening.

Anonymous said...

[url=]Magicbit DVD Ripper Deluxe[/url] [url=]No 1 DVD Ripper 7.2[/url]
A-Z PSP Video Converter 5.29 Shine MPEG Video Converter Altarsoft Video Capture
[url=]CD-DVD Lock 2.7.521.801[/url] [url=]Altdo Video Converter Diamond 4.2[/url]
Koobo iPod MP4 Video Converter Mint Online TV X Audio Video Joiner
Any Video Converter Pro 2.5.6
my icq:858499940385