May 4, 2009 - Issue #161
Rising Prices Declining Volume
Rising Prices Declining Volume, the weakest price/volume relationship under any market
conditions. It usually indicates a lack of enthusiasm on the part of buyers. Let's face
it, there is not much to be enthusiastic about this market, that I can see, and there is
much to be wary of.
CNBC guest analysts, perhaps, will enlighten us?
Warren Buffet, the Oracle of Omaha, was hardly encouraging (at least for the near
term) at the Berkshire-Hathaway annual shareholders meeting over the weekend, was he?
All the volatility indexes are relatively low, usually indicative of a 'peak'. Is this
the 'calm before the storm'? Are suitably priced Options available in markets you follow?
Get out your Fibonnaci tool and take your readings. Things are about to get interesting.
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?
5/9 Saturday - Full Moon (Observe Friday 5/8 & Monday 5/11 market price action).
5/24 Sunday - New Moon (Observe Friday 5/22 & Monday 5/25 market price action).
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):
5/4 (Transportations) OSG.
5/5 DIS, KFT.
5/6 (Transportations) EXPD.
Dow score card for the week ending 5/1/09.
DJ-30: 8212.41 +136.12 +1.69%. The Real World (arithmetical) DJ-30: 34.37 +0.57 +1.69%.
UP: 19, Down: 11.
Trends (weekly charts): This is the subjective part.
Rising (Generally Higher Highs/Higher Lows) 10 (+2) 33%:
+*AA, +*BA, CAT, +*DIS, +*GE, +*HPQ, +*IBM, +*KFT, MMM, UTX.
Consolidating (Generally Lower Highs/Higher Lows) 17 (+1) 57%:
-*AXP, BAC, C, CVX, -*DD, GM, -*HD, INTC, +*JNJ, -*JPM, +*MRK, -*MSFT, +*PFE, PG, T,
Declining (Generally Lower Highs/Lower Lows) 3 (-3) 10%:
KO, -*MCD, -*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!