Corepuncher's Account Talk

[Steadygain]

Good Morning CP,
This is becoming a Soap Opera... with the same story going on and on


Here's where we are:
Markets will HOLD here for a little while... probably even start moving up


The overwhelming majority will declare this is a BOTTOM


As with every other fairly big decline since 11/08 the thought that we're only half way there is impossible to grasp - and reports will increasingly give us confidence 'We're finally there'

Then we'll dive at least another 5 to 8% and go through it all over again. It's getting pretty old

Reminds me of the movie 'Ground Hog Day'

 

[Corepuncher]

Got this from KD's blog. It makes me laugh every time. It is our government. Instead of locking up who needs to be locked up and facing the music, they are going to drive us off the cliff.

http://www.youtube.com/watch?v=4z88U915uq8

Did you all see the story about how American Express is paying people 300 bucks to pay off their credit card accounts and close them? DUDE! If that doesn't say it all, I don't know what does. Short retail at will...and take pictures of all your credit cards because they are going bye-bye soon.

I agree Steady. This will not be the bottom. Of course since I bought in at 770, I"m hoping for that bear rally to 800 or above. Earnings ratios looking forward are only going to get worse. Just imagine what will happen if we monetize debt and interest rates skyrocket. Ouch.

 

[turbo23dog]

I well remember the 1980-82 time frame when we had high inflation and mortgage rates hit ~11%. I was under military orders at the time and was trying to sell my house in Tidewater, VA area which ultimately had to be done under an assumption since nobody was getting new mortages at the time. We sucked it up and upon reaching new duty station, rented an apartment until ~1985 at which time things had settled down enough for inflation and home loan rates.

Point is, a pretty bad situation eventually got better, and I have strong confidence in America that things will get better this time too.

 

[Birchtree]

Opportunity is made to look like a disaster and disaster looks like opportunity.

 

[Corepuncher]

In the above image, I am highlighting 3 consolidation ranges and subsequent rallies.

Actually, I drew the lines from the tops of the bear rallies and to the left...where they just so happen to intersect near the mid-range of the previous 3 consolidation periods. Well, actually, the 3rd line is drawn from the last consolidation zone to the RIGHT (which is a predicted top that has not happened yet).

The point being, it seems like after the big breakdowns (Mid November, Januray, and Now), the market is only able to rally back to the previous consolidation ranges.

I would call the next target, based on this logic, 810-830 (avg 820).

Other targets:
20 day SMA, about 820.
50% retrace from 878-742 = 810
50% retrace from 944 to 742 = 843
50 day SMA = 850

So we have 820, 820, 810, 843, 850. We all know we had that 804 that was key, as well as 820 (as seen on CNBC).

Given all these levels, a conservative goal to sell would be 804-810, a little more risky is 820 and the ballsy move would be to wait for 843-850.

My personal target to sell my C shares (bought at 770), is:

800-819

OH...I suppose I should also decide on a downside BUY target (after 3/1).
Lets see...we have no support in the DOW as we are at new lows.
We have no support except 741 in the S&P, but obviously that will be breached if we go down to where it is tempting to buy.

One thing we can look at is the Russell 2000 and the NASDAQ...both of which have been leading the market and have shown relative strength. What percentage would those two indices have to fall in order to EQUAL/TEST their November lows? Then, we can convert that into an S&P level. This assumes we would get a bounce as the prior two indices retest the lows.

RUT: (Nov low= 371.3 - current 406.15)/406.15 = 8.6%
NASDAQ: (Nov low = 1295.5 - current 1420.5)/1420.5 = 8.8%

Fairly similar. So, if the S&P 500 were to fall 8.6% from the current level of 763.8, that would put us at:

698

That seems a reasonable target as it is just below the psychological level of 700.

 

[amoeba]

your target is mine; north of 800 - sell sell sell SELL SELL SELLLLLLLLLLL!!!!!!!!!!
south of 700 - buy buy buy.

Now, if I can only catch the lucky dozen who have beat G-fund this year, that will make my month.

 

[JTH]

Congratulations CP, I see you're # 2 on the tracker! But more importantly, thank you for contributing your thoughts on the market. I'm not sure if I'll attempt to buy in below 700

However, if I have free capital when it hits 800ish, I'll likely go short

 

[Steadygain]

CP - just a quick followup on the last post.

I couldn't stand #2 - must be the woman in me

Anyway - speaking of women, I thought about you driving home last night playing the drums.

Bonne Tyler's song 'It's a Heartache' started playing and I wished like anything I was in an environment where I could totally get lost in that song and float away.

She's got this gravely voice that's perfect for this song.

It sounds sad ... but in my video mind this is the ultimate love song

I see the guy feeling her pain and knowing through and through that she's the best thing he could ever find and there is no way in hell anyone would ever be able to take her place... so this is ultimately the grand finale of their relationship - he's becoming everything she could have ever hoped for....

Well anyway - you pretty much dominate the first part of the song...

but I bring more guitar into the song softly at first but it gets stronger in the middle and then totally takes over... blending with her voice - but HER VOICE is everything so I keep that the centerpiece ALWAYS.

It's a heartache
Nothing but a heartache
Hits you when it's too late
Hits you when you're down

It's a fool's game
Nothing but a fool's game
Standing in the cold rain
Feeling like a clown.

It's a heartache
Nothing but a heartache.
Love him till your arms break
Then he lets you down.

It ain't right with love to share
When you find he doesn't care for you.
It ain't wise to need someone
As much as I depended on you.

It's a heartache
Nothing but a heartache

Hits you when it's too late
. . .

It ain't r'ight with love to share
. . .

Oh it's a heartache

Nothing but a heartache.
Love him till your arms break

Then he let's you down
It's a fool's game

Standing in the cold rain

Feeling like a clown.

It's a heartache
Love him till your arms break
Then he let's you down
It's a heartache

 

[Corepuncher]

Sorry about the poor quality...I whipped it up quick...

Bring on the Plunge Protection Team!

 

[Gumby]

Sorry about the poor quality...I whipped it up quick...

Bring on the Plunge Protection Team!

You have finally found a job for them that they can perform to expectations. Everybody needs a job!

 

[fedgolfer]

the PPT or the market is going to have to show support around this level (755'ish) on the s&p for the inverted h&s to remain bullish... if it falls much further the candlesticks will show a bearish continutaion on the 5 day intraday charts, imho.

Another re-test of 741 is getting a little hairy, but with the IFT limits I may have to let it play out.

 

[Corepuncher]

the PPT or the market is going to have to show support around this level (755'ish) on the s&p for the inverted h&s to remain bullish... if it falls much further the candlesticks will show a bearish continutaion on the 5 day intraday charts, imho.

Another re-test of 741 is getting a little hairy, but with the IFT limits I may have to let it play out.

Rally in progress! I think if we hold the day and end up at the close, we are setting the stage for a ferocious bear rally possibly to 850...or a quick 10% up from here.

 

[Corepuncher]

Compare the last 3 days to the 1/20-22 period.

I say target 805-810.

 

[Steadygain]

Compare the last 3 days to the 1/20-22 period.

I say target 805-810.

I had NO IDEA .... was simply going with my gut

and honestly thought I'd be the only one to vote GOING UP on my poll

instead of going down .... the KEY is which will be first

Great post CP


I DO SUSPECT YOU BELIEVE A LOWER BOTTOM IS YET TO COME

 

[felixthecat]

Decided to stay put as early morning selling of weak hands helped me to make my decision to stay in. I would much rather have selling after a big rally than to be up in the morning. I believe as Corepuncher has indicated, we are setting up for nice bear market rally.

I would feel comfortable holding in the 795-800 range but anything higher would need to be supported by better economic data. Has anybody seen any good econmic data? I see housing still is bad. I sure wish we get get some good data in housing to ignite the markets. However, I think the technology and banks will ignite a short term rally.

Here's hoping for a greener pasture.

 

[Steadygain]

Has anybody seen any good econmic data?

Unfortunately that was the main thing I did yesterday morning

The DATA is terrible - I mean really bad - getting worse by the month

Here's hoping for a greener pasture.

They are bound to come - not because of the Data - but because the moods will fluctuate and the VOLUME that really moves the Markets are craving to 'Feel good' and 'jump on the first sign of an uptrend'

I'm hoping the SURGE associated with this recent downturn comes next week - when I can go in

 

[Corepuncher]

I DO SUSPECT YOU BELIEVE A LOWER BOTTOM IS YET TO COME

That is correct. I sorta feel like the market is doing a lot of "hoping" right now...because it is scary territory under those Nov. lows with nothing but "air" beneath the charts. I still think the NASDAQ/Russell Nov. lows could be a safetly net for the entire market, that is, we hold 695-700 on the S&P.

Today is just crazy looking at the tick by tick charts...where we stop, nobody knows!

 

[fedgolfer]

Is this the Obama short squeeze, or the Tiger effect? Tiger will win 9 and 8 and we'll close around 780 on the S&P. I sound like I've been drinking that Pelosi cool aid.

 

[Corepuncher]

Compare the last 3 days to the 1/20-22 period.

I say target 805-810.

In the above image, I am highlighting 3 consolidation ranges and subsequent rallies.

Actually, I drew the lines from the tops of the bear rallies and to the left...where they just so happen to intersect near the mid-range of the previous 3 consolidation periods. Well, actually, the 3rd line is drawn from the last consolidation zone to the RIGHT (which is a predicted top that has not happened yet).

The point being, it seems like after the big breakdowns (Mid November, Januray, and Now), the market is only able to rally back to the previous consolidation ranges.

I would call the next target, based on this logic, 810-830 (avg 820).

Other targets:
20 day SMA, about 820.
50% retrace from 878-742 = 810
50% retrace from 944 to 742 = 843
50 day SMA = 850

So we have 820, 820, 810, 843, 850. We all know we had that 804 that was key, as well as 820 (as seen on CNBC).

Given all these levels, a conservative goal to sell would be 804-810, a little more risky is 820 and the ballsy move would be to wait for 843-850.

My personal target to sell my C shares (bought at 770), is:

800-819

OH...I suppose I should also decide on a downside BUY target (after 3/1).
Lets see...we have no support in the DOW as we are at new lows.
We have no support except 741 in the S&P, but obviously that will be breached if we go down to where it is tempting to buy.

One thing we can look at is the Russell 2000 and the NASDAQ...both of which have been leading the market and have shown relative strength. What percentage would those two indices have to fall in order to EQUAL/TEST their November lows? Then, we can convert that into an S&P level. This assumes we would get a bounce as the prior two indices retest the lows.

RUT: (Nov low= 371.3 - current 406.15)/406.15 = 8.6%
NASDAQ: (Nov low = 1295.5 - current 1420.5)/1420.5 = 8.8%

Fairly similar. So, if the S&P 500 were to fall 8.6% from the current level of 763.8, that would put us at:

698

That seems a reasonable target as it is just below the psychological level of 700.

Inverted head and shoulders pattern confirmed today...with a projected target around 808!

Looking at my previous posts, there sure seem to be alot of reasons for a target of 805-810! I am hoping to get to that level either Thursday or Friday for a sell and to lock in a profit.

 

[Gumby]

CP

Thanks for the great post. Very informative. I hope you are right!