It Was Pretty Obvious (by Xerxes)

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I swear that sometimes, when I finally switch my bias, it is like the market gods are watching only me and decide to flip the switch. I call this the “gambler’s conscience”. Like if I had just held on one more day, or laid down one more bet I’d have hit that jackpot. But that is not what trading is about. I needed to quiet that voice yesterday and admit to myself that the bullishness was finally the market making its decision.

Well, here we are. What a reversal. I’ll take it. I don’t pretend I always pick the right direction. But I’d like to think that if I see the markings of something moving against me, I can avoid stepping in front of that train. So I saw the move up and decided “I’d better prepare myself for admitting I was wrong”. But Friday changed all that. I won’t sit here and pretend I saw this coming.

All I can do is just go with the flow. Friday’s action has the potential to turn the tables (yet again) back in the bears’ favor as this would be a failed bullish breakout which I am sure sucked many bulls in and flipped many bears, including myself.

But besides my incorrect assessment of imminent bullgasmic trajectory, my point in my last post remains the same in that individual stocks are currently offering clearer patterns and spots to make more profitable trades than the broad market as the water is simply too muddy for me. Here are a few more bearish charts I am watching:

Shippers are all in a sort of sideways consolidation lately. Perhaps they are all just coiling up before shooting up? Perhaps, but the chart just seems so weak. They are all consolidating UNDER moving averages, slowly drifting down, with resistance lowering and holding. I’m looking for the break beneath $13, targeting $12 first, possible bounce there, but eventually I am looking for a rollover on weekly towards $9.

E-commerce seems to be having some weak tendencies. I’ll need to see if any other e-commerce businesses have charts like this, but this one specifically had its bad week back in July/August. Now it is attempting to claw its way back up, but when I see a bounce attempt like this with lack of commitment, it feels more like a dead cat bounce. This consolidation sideways supportive attempt should see a large red weekly candle forming before the end of the month. I’m targeting $25 at least by the end of the year.

Macy’s is already in a free-fall so this is more of a “how low can you go” type of trade. More for scalping opportunities. I think this can at least test $10 (hell, that’s still a 10.5% drop from here, not a bad return). I kind of wish I was watching this up at $15.50, but here we are now.

NOT a Bearish chart at all. I just didn’t want to leave this post finished without posting at least one bullish idea. This is not currently offering any easy entries (unless you are a buy and hold investor), but the mere strength of this stock has now put it on my radar to look for entry patterns to get long. Who would’ve thought general stores was the real moneymaker to sink your investment account into?

So, as I offered in my comments, a mea maxima culpa on my poor timing. But we are not out of the woods yet (at least at the time I am writing this around 2pm Friday). We need to see the day close down here below 4460 on SPX and see continuation next week to retest and break beneath 4430. Only then can we say the bears firmly have the ball. Otherwise, we remain in this weird choppy zone of uncertainty. Regardless, I’m still focusing on the few specific stocks which have clear patterns while the market sorts itself out.