Aug 4, 2008 - Issue #122
Cramer Calls Bottom!
Cramer, of CNBC's Mad Money fame, has gone off the reservation again wildly declaring
that the market has hit bottom. What a gutsy call. I still remember Scudder Fund's
portfolio manager calling Dow 16,000 by year-end '07 a 'slam dunk' just before the Dow
dropped hard. Will Cramer's prediction suffer a similar fate?
Have we seen the bottom or are we still in a bear market? Are we simply experiencing what
technical analysts call the 'pause that refreshes' before continuing its downward spiral?
If it is a 'pause', a 2,000 point drop from here is not out of the question. What would
cause it? Perhaps, the Democratically controlled Congress adjourning without allowing
a vote on offshore drilling for oil? Maybe the market fears what raising taxes on
business will do to an already weakening economy? Employment is declining. Real estate?
Retail? Credit? Iran's nuclear defiance and what that implies? Can't you figure it out?
America has a super critical decision to make in November.
During the next two weeks, the following Dow components will report earnings. Keep a
sharp eye for 'surprises'. You might be able to catch a nice swing in the week or two
leading up to 'Earnings Day'.
8/5 - GM, PG. EXPD (Transports).
8/6 - AIG.
8/12 - HD.
8/14 - HPQ, WMT.
Dow score card for the week ending 8/1/08.
DJ-30: 11326.32 -44.37 -0.39%. The Real World (arithmetical) DJ-30: 46.37 -0.18 -0.39%.
UP: 14, Down: 16.
Trends (weekly charts): This is the subjective part.
Rising (Generally Higher Highs/Higher Lows) 3 (-5) 10%:
BAC, +HPQ, +*KO.
Consolidating (Generally Lower Highs/Higher Lows) 24 (+5) 80%:
AA, -*AIG, AXP, C, CAT, +*CVX, DD, DIS, -*GE, GM, -*HD, IBM, INTC, -*JNJ, JPM, MCD, -*MMM,
+*MRK, MSFT, -*PFE, PG, -*UTX, WMT, XOM.
Declining (Generally Lower Highs/Lower Lows) 3 (n/c) 10%:
-*BA, T, -*VZ.
+/- 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!