First off, Happy Halloween to anyone who is "celebrating" that tonight.
The market today continued to do what we have seen for the past 4 days (today being the 5th). We have been trading in a tight right for a quite a while. We have yet to see much conviction either way though. The battle going on between the bulls and the bears is fierce. Both bulls and bears are trying to prove themselves. Personally, I think we are going to be in the range till the election. Maybe not, but if we do not stay in this channel until then then we could see a more drastic price movement before or right after the election (depending on who is elected, and what the market would like to see). One notable occurrence is that we have "wicked" off the lows the past three days, and closed in the top half of this channel. This is the case for bulls. For the bears... They would argue that since we have closed some many times in the lower range of the overall move that we should continue lower. So, in summary - The price movement is not giving us much clarity and we need to wait for more confirmation. Swing traders should probably stay on the sidelines until this channel is resolved.
As for the banks. They showed a little more weakness today, therefore did not warrant (for me) as swing long or a buy at all. Compared to the overall market however, the banks are still holding up well and as long as they continue to do so, we will still continue to have a chance to go higher.
The tech sector has showed more weakness but did close with an inside day today ($qqq). I would expect some more consolidation (as we expect in the overall market) before deciding which way we are more likely to go. Google showed some strength today, and is maybe trying form a descending channel.
IF the banks, homebuilders, and the techs all start to show some more strength then we head higher. I will be waiting to see if this happens. Until this happens I think we could continue to chop, and whipsaw a little.
Check my Twitter (@BenCBanks) for more charts for today. They will be posted later on.
Remember to click to enlarge the photo.
This analysis is purely done on the charts, not much typing. Leave a comment stating which kind you like better. Also, remember to click to enlarge the images, and tweet me if you would like me to analyze a ticker.
Alright guys, sorry for the delay on the post. I was at $SBUX (Starbucks) studying for an exam this evening.
Let's get started. The $spy fell at the start of the day to a new low and then really showed some strength near the end of the day thus forming somewhat of an "outside day" and a minor hammer. A bounce to around 144.40 is definitely probable but is it a great long? Well, depends on your style. If you are in front of your computer and a day trader then yeah, maybe you can nimble some. But for the swing trader -- this may not be the best play for you. I also think the Risk to Reward is too little. You risky at a minimum .50 for a 1.00 return -- that isn't AMAZING. That being said, if you got long at the LOD (Low of the day) today then yeah, I would stick with it and maybe trim some around the 144.40 area. Any continuation over the 144.40 area would put us back in the running to the top of the channel we are trading in. If you are asking if I am long anything right now... Well, no. I am not. I usually buy after hours so I can see how the market closes but today I didn't think the R:R is the best, it went up too much after hours (I don't chase) and the volume is lacking.
Apple, $aapl, WOW! Apple had an amazing day today gaining over 4%! It basically totally negated the huge red bar we saw on Friday. This being said, with the iPad Mini coming out tomorrow and given how weak it has been, I am not buying it. Also, at this point I feel like you would chasing the price up -- DON'T chase -- it WILL kill you. Apple is also sitting at some minor resistance. So can it continue? Of course it can, and probably will (at least gap higher) but is it a good buy right now? Probably not.
Google, $goog, Google showed continued relative weakness - it is trying to find a bottom but it hasn't quite yet. I'll be keeping a close eye on this one.
Banks -- The banks continued to show some strength today but it wasn't great. It dropped a pretty good amount in the morning before coming back to close even for the day forming a hammer. So, it could be an alright small swing entry here but it isn't awesome. $bac, Bank of America however did hold well and is still forming a place to break out of. I will be watching $bac closely -- this one will break out and go soon.
HomeBuilders -- The homebuilders showed continued strength today, and it is very impressive. These can definitely continue on but it looks like they could still use a little more time of consolidation.
From now on I am only going to post the daily analysis here, I do not want to clutter the rest of the blog to the point you can't find the recaps.
I am looking forward to Monday with you!