Archive for July, 2009
Would you let your mother buy this stock?
Posted on Jul 14, 2009 by WHC Bassetti.
When the history of the great Bush bear is written there will be a special chapter for Goldman. Goldman would be quietly interred next to Lehman and Bear if Secretary Paulson had not poured government money into AIQ which was just a funnel for billions to Goldman. Somewhere the ghostlike voice of Teddy Roosevelt is murmuring “malefactors of great wealth…”. Well regardless of Goldman’s role in the global meltdown it has with the Treasury’s help clawed back part way to its heights.
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Minding your Ps and QQQQs…
Posted on Jul 11, 2009 by WHC Bassetti.
Here’s an interesting idea. Shorting the Qs with QID. It looks like a pretty low risk trade to us. The safest stop is tight under the nearby low. The last few days there were obviously some people shorting — see the power bars and the gaps. If this doesn’t work remember you didn’t hear it here.
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Trading when the crystal ball is foggy…. (with a chance of meatballs)…
Posted on Jul 11, 2009 by WHC Bassetti.
Strangely (and stranger and stranger) the SPX has not broken yet. In the INDU (previous letter) the break appears (though waiting further action for confirmation). But the neckline of the little H&S formation is holding the SPX price. The short term trendline is broken, the 200 day moving average hovers overhead like a buzzard in the Sahara and there is a clear (if anomalous) pattern of lower highs and lower lows. The narrow ranges promise some volatility next week.
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Some Wave thoughts…
Posted on Jul 09, 2009 by WHC Bassetti.
We coulda, shoulda, woulda commented in our last letter about an important feature of the Indu chart here. That is, a pattern of lower highs and lower lows has been established. It is not a downtrend of much strength yet. But the facts continue to pile up predicting lower prices.
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Where from here…
Posted on Jul 07, 2009 by WHC Bassetti.
To measure or not to measure, that is the question as Shakespeare said in Measure for Measure. Everyone knows how much we hate to measure formations. Few know the reason. Nonetheless it is worth discussing likely implications of the little head and shoulders formation here. It is 664 points deep with a neckline of 8214 making a likely minimum target for prices of 7549.
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Noted technical analyst WHC Bassetti has over 40 years' experience in the financial markets and is Malcom S.M. Watts III Adjunct Professor of Finance and Economics at Golden Gate University. He is editor of the Ninth Edition of Technical Analysis of Stock Trends, widely considered to be one of the true classics of market analysis.
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