Feb 2, 2009 - Issue #148
Pressure is building. Lateral price action on increased volume indicates the battle is
joined. How is the consolidation we are witnessing going to resolve? Up or down? In my
opinion, events in Washington, D.C. will determine the outcome. Are we to attempt to
tax and spend our way to prosperity (something which has never worked) or bite the
bullet and muddle through?
CNBC has been doing a masterful job of presenting the issues. Apparently, the Republican
stand has caused some re-thinking among the Legislature. The Democrats fear they will be
blamed and will lose the House and Senate two years hence. They have reason to fear.
Buy Puts and be prepared to 'morph' into synthetic Calls by going long stock if the
market shows strength.
W. D. Gann, a keen market observer, although not an astronomer, nevertheless, was
fascinated by the apparent coincidence of important market 'pivot points' and astronomical
dates. Theories exist for estimating time and price of important market turning points but
astronomical occurrences are computed with mathematical certainty.
There is no logical reason why these occurrences should coincide yet, empirically, they
have. The 'Full Moon' and 'New Moon', among others, have been cited. Therefore, one might
be well advised to be aware of their occurrence. Note: The first 5 business days of 2008
concluded on a 'New Moon' and we all know how that worked out. Coincidence?
2/9 Monday - Full Moon.
2/24 Tuesday - New Moon.
During the next two weeks, the following Dow components report earnings. Keep a sharp eye
out for possible price swings leading up to 'earnings day' (Subject to revision):
2/3 DIS, MRK, (Transportations) UPS.
2/4 KFT, (Transportations) AXB, R.
Dow score card for the week ending 1/30/09.
DJ-30: 8000.86 -76.70 -0.95%. The Real World (arithmetical) DJ-30: 33.48 -0.33 -0.95%.
UP: 13, Down: 16, N/C: 1.
Trends (weekly charts): This is the subjective part.
Rising (Generally Higher Highs/Higher Lows) 1 (N/C) 3%:
Consolidating (Generally Lower Highs/Higher Lows) 21 (+13) 70%:
+*AXP, BA, +*BAC, +*C, +*CVX, +*DIS, +*GE, +*HD, HPQ, -*INTC, +*JNJ, JPM, KFT, +*KO,
+*MCD, +*MMM, MRK, T, +*UTX, VZ, XOM.
Declining (Generally Lower Highs/Lower Lows) 8 (-13) 27%:
AA, CAT, DD, GM, MSFT, PFE, PG, WMT.
+/- denotes change of direction.
* denotes change of category.
Comments? Ideas? Feedback? Let me have it, right between the eyes! I'd love to hear from you. Just reply to this zine and tell me what you think!