Tuesday, July 31, 2007

 

What a day

The Dow was up, the Dow was down. Just a heck of a lot of volatility. Very fun to watch in between getting my trading set up, cleaning up cat pee off our beds, and buying water proof mattress pads. Right now the S&P futures are down 1100 points which is about an 80 point drop in the Dow tomorrow morning. The Dow closed below support at 13,250 and the S&P is right at important support. A move lower tomorrow with a lower close looks really ugly.

It is time for you casual market watchers to start paying attention. Today was the day that the dip buyers got their first clue that the bear was in control. The stock markets rallied strong until 9 pm. The Dow was up 140 points to just shy of 13,500. (The markets like to stop at round numbers.) But then the bear took over and drove the market down relentlessly for the rest of the day. The dip buyers won't go away just because of today just like it took a long time, and capital, to slaughter the bearish rally sellers.

This is just a taste. I expect the bulls will have a nice rally at some point. Markets don't move in straight lines. Besides, the market has to keep most people optimistic enough to hold their shares even while the market falls. It's almost insidious the way the market keeps hope alive just long enough to keep the majority complacent so that they will feel comfortable leaving their money in the market right before the boom is dropped.

I am looking for support around 13,000, a big, round number, and 12,500, about where the Dow started the year. Enjoy the ride, weeeeee. Which reminds me I have to go check our beds.

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