The daily DOW is still oscillating within a narrowing trading pattern called a triangle. Today we have strong support from the oil sector, as I stated earlier. Oil made a daily 13 at 70 and should trade back above 80 the next days - even up to 85 before starting another downleg. Now as of today, 50 has been put as a price tag by heavy volume in the crude 50 options and even Goldman joining the bearish camp on oil - markets trade up. The Tech sector does not follow the strength and we should see later today how the market forces evaluate the situation. Some daily indicators are even a bit overbought. The 3 month Libor came down quite a bit, so we are out of the hysteric phase for now as the VIX comes down considerably as well today. My basic scenario remains unchanged -we need a final and volatile dip to generate a real trough and that should unfold within the next 2-3 weeks.
Monday, October 20, 2008
DOW technical update - energy sector helps the markets
The daily DOW is still oscillating within a narrowing trading pattern called a triangle. Today we have strong support from the oil sector, as I stated earlier. Oil made a daily 13 at 70 and should trade back above 80 the next days - even up to 85 before starting another downleg. Now as of today, 50 has been put as a price tag by heavy volume in the crude 50 options and even Goldman joining the bearish camp on oil - markets trade up. The Tech sector does not follow the strength and we should see later today how the market forces evaluate the situation. Some daily indicators are even a bit overbought. The 3 month Libor came down quite a bit, so we are out of the hysteric phase for now as the VIX comes down considerably as well today. My basic scenario remains unchanged -we need a final and volatile dip to generate a real trough and that should unfold within the next 2-3 weeks.
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