Oct 19, 2009 - Issue #185

On Borrowed Time?

On borrowed time? The DJ-30 is up but the MACD is lagging. That's called 'divergence'. The 200sma is cresting and rolloing over.

CNBC anchors & guest analysts, for the most part, try to put a positive spin because viewers don't want to hear negative. It's not good for ratings. People don't like hearing they're about to lose money. Notice 'experts' are always asked, "What are you buying now?" They never say, "Sell...Go to cash." That is not what viewers want to hear, even if it is the best choice.

The best interview recently, with an extremely successful hedge fund manager, stating he went long in rising markets and short in falling markets. That's how he does it. Do you ever expect to hear anyone at CNBC to say, "Sell short"? Not likely.

Heads Up

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?

10/18 Sunday - New Moon (Observe market action 10/16 Friday & 10/19 Monday).

During the next two weeks, the following DJ-30 components report earnings. Keep a sharp eye out for possible price swings leading up to 'earnings day' (Subject to revision):

10/20 CAT, DD, KO, PFE, UTX.

10/21 BA.

10/22 AXP, MCD, MMM, MRK, T, TRV.

10/23 MSFT.

10/26 VZ.

10/29 PG, XOM.

10/30 CVX.

Dow score card for the week ending 10/16/09.

DJ-30: 9995.91 +130.97 +1.33%. The Real World (arithmetical) DJ-30: 44.09 +0.58 +1.33%.

UP: 21, Down: 9.

Trends (weekly charts): This is the subjective part.

Rising (Generally Higher Highs/Higher Lows) 17 (+9) 57%:

+*AXP, +*CAT, +*CVX, +*DD, DIS, +*HPQ, INTC, +*JPM, +*KFT, +*MCD, +*MMM, +*MRK, +*MSFT, PFE, +*UTX, +*WMT, +*XOM.

Consolidating (Generally Lower Highs/Higher Lows) 13 (-7) 43%:

-*AA, BA, BAC, -*CSCO, GE, HD, -*IBM, -*JNJ, -*KO, PG, +*T, TRV, +*VZ.

Declining (Generally Lower Highs/Lower Lows) 0 (-2) 0%:


+/- 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!

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