Hi Everyone,
It would seem that unless something is glossy and making all sorts of outrageous claims of overnight riches it just does not cut it on the Internet !!! I’ve been posting my reports for a while now and I have attracted some readers buy no one has left a comment nor asked any questions which puzzles me greatly. My system is solid, my trading approach works day in day out as long as The Dow Cash Index moves and it does not rely on any form of technical anlaysis. Can it bring you the riches you desire…………….with a consistent application of the rules/system yes it can and an income for life. Am I motivated by money, not really but I do have clients who are. Money is only a problem when you don’t have any !!! Not everything that glitters is golden !!! Sorry I don’t have pictures of me getting into my helicopter nor leaning against one of many supercars on my drive. Not everyone is into all of that, some people prefer to live a modest lifestyle and give to others and do other things to grow their spoils.Before The Opening Bell
Much happened mid morning during the the European session with General Electric reporting a poor profit of 6% a KEY company and struggling.Not helped either by GE cutting its forecast for the remainder of 2008.Shares of GE fell 10% in premarket trading.
Genentech Inc also missed its earnings target and was downgarded
At 1.30pm the Import Price Index came in with an increase in prices and at their highest since November 2007 (fuelled by the high oil price………forgive the pun !!).
Consumer Sentiment was due at 3pm.
SW Report
UP level is 12665
DN level is 12450
Watch 12650 for direction. A strong breakout is forming one way or another.
The Dow (Wall Street Daily Cash Index) at 2.30pm
Open 12454
High 12467
Low 12438
Initial Signal Rule 5 SELL
Signal Confirmed YES
Signal Changed NO
3pm Index At:12461
Comments:There was an attempt by the index to make some progress up helped by S1 being breached during the early movement but the index was struggling to shrug off the downward pressure and I had a test of 12400 in mind from the off really.12400 would likely put up a bit of a fight before caving in if it was to cave in (time would tell).Consumer Sentiment figures came in at 3pm and registered its lowest reading since 1982.
Choices:The 3pm price at around 12360 was a great entry down to the test at 12400 initially where you might have opted to take profits or stick with it to wait to see if the BRN gave way. I was in here and out at 3.09 at 12410 for a quick 50 points on the board.I later entered SHORT again at 12466 at around 3.50pm as the index had made no real progress UP there was no change of signal approaching 12400 (just a normal retracement back away from it).The target was still 12400 as that level had still not given way but I considered it to be just a matter of time and we would see the break.
CheckPoint At 4.30pm
Index Trading at:12432
High 12467
Low 12405 at 3.11pm
Developments:The index had been down to test the BRN at 12400 but had not successfully broken through it. It was putting up a good fight as you might expect.On its retracement the index had hung around the 12450 level and made little progress away from this level.
Comments: There were opportunties to get in at around 12450 and a little higher at around 3.50pm until 4pm where you could have pegged your SL comfortably at 31 to 33 and been safe in the knowledge that the index had not been higher than 12467 today.
The Dow (Wall Street Daily Cash Index) at 6pm
Index trading at:12408
High 12467
Low 12396
Developments:The breach of the BRN had happened at 5.30pm with a dip down to 12396.The index had also travelled back up to 12448 at 5pm which had you not already been in on a SELL trade was yet another excellent opportunity to get in initially down to the BRN but if it was breached then the S2 level was the target for profit.
Comments:Any SELL trade entered earlier or at around 5pm was now on target for a potential move down to S2 at 12320.If trading the early session and not involved in a SELL trade before this point you need to ask yourself what you are seeing to prevent you getting into the index.
Additional Comments:It was possible given what had happened during the early session to use 12408 as your entry at around 6pm but you may have wanted to peg your SL a little wider to12450 just in case of a later retracement.The index was brewing up very nicely for a BIG move and continuance down. If already in a SELL situation you would just go with the flow and enjoy the ride down.The low was still 12396 at this point.
At 6.30pm the index was at 12391 this was a lower low and a good entry if already not involved in a SELL trade.The lower low telling you the index is likely to continue down and the potential target now at S2 at 12320.
At 7pm the index was now lower at 12378 and there had been lower lows the lowest at 6.55pm at 12368.There was no evidence of other than very mild pullbacks of a few points and so a good retracement was unlikely such was the SELLING pressure.And so if still not involved this was a good entry point for your SELL pegged to the 12400 level as the index had not been above here since 6pm now and lows had got lower.And no need to exit any sell trade placed earlier in the session even if tempted by the number of points profit talllying on the board (unless of course you were content to take them).
At 7.30pm the index lower at 12352 with a lower low at 12340 at 7.16pm and still heading lower. If still wondering what to do you would now strat to need recognising the time and just how far the index had travelled down today and so you would be looking for any signs of a retracement higher to give you a entry.
At 8pm the index was at 12348 and had been higher at 12366 at 7.54pm but that appeared to be it as it was heading south and not really looking back.Entry now was difficult as risk versus reward was tricky as S2 lay ahead at 12320 and was the target also with an eye on 12300 too.
At 8.30pm the index was at 12343 and the index had been lower at 12326 at 8.14pm where you may have taken profits OR elected to wait for a possible test of the BRN at 12300. I took profits at 12318 as I was going out and I did not want to pre-empt what might happen at 12300 should the index get there.
The index did get within a whisker of 12300 reaching 12304 by 8.47pm and then it rose into the close and closed just above its S2 level at 12325 where it settled at 9pm.
And so the breakthrough came today and the index broke free of the range (12500 to 12600/700) that has persisted all week making for some tricky sessions. It was helped down by the poor earnings results and outlook for 2008 provided by General Electric.And with earnings season strating in earnest on Monday 14 April this could just be the start of lots of good BIG moves.
Ist Quarter Earnings Reports From 14 April For Two Weeks(ish).
You have already had evidence via the results today, particularly those from General Electric, just how sensitive the market is to earnings being missed and or downgrades of companies that have performed poorly. To some extent when energy prices have been high, consumer spending flat, unemployment figures high etc., etc.,I don’t expect companies to do well and yet it would seem the market does !!! The opposite of course happens when big bellweather companies hit or exceed their earnings estimates.Wall Street celebrates and goes over the top.So moving forward we need to be vigilant to what is happening as poor results from one company and good results from another can have the index moving down and up with big swings.
So in terms of your preparation for trading from Monday spend a little more time getting a handle on what companies are reporting earnings and when.Those reporting before the opening bell will bring on a reaction during the European trading session which can carry over into the US session from 2.30pm. Those reporting after the market closes can be ignored and picked up on when preparing for the next days trading. It is those that are reporting during the US session that cause the most difficulty and it can be difficult getting a handle on when the news will come so care is needed. Make sure you read the Market Watch report on the homepage everyday before trading and note any companies that are reporting and when. If you are not clear what companies make up the Dow Index then google it and familiarise yourself with their names.Also bear in mind that NasDaq companies and those belonging to the S&P 500 will also have an impact on The Dow Index too.The market wants to see whether BIG companies have weathered the economic storms. General Electric did not manage it but don’t assume they will all have missed their targets !!!
Don’t worry too much about this just do your preparation and you will be fine. If things are not clear I shift my trading efforts to the evening session on The Dow from 6pm onwards as companies have either reported by this time or they will not report until after the market closes.
Just continue to follow the numbers.
WR
Julie
