Market Tanks, Cubes Speculator Bulletin Soared

[Capital Essence NewsDesk] As we've predicted right here in our previous Market Outlook:

Bearish Bias (23/8/07): Prices could be heading for a retest of last week [August 16] low.

The "lows" will be retested (27/8/07): Monday's trading action suggested a negative bias into Tuesday trading session. Expect volatility to shoot up.

Stocks got hit hard Tuesday with the majority of major indices lost an average of 2.20% for the day. The CBOE Volatility Index (VIX) shot up 15%.

 

Editor's Note: below are just some trading ideas flow from our premium Headlines.

"Cubes Speculator Bulletin":

August 22, 2007 @ 9:30 PM - "QQQQ is testing resistant at the area of the third target; this is the last stop before a serious decline kicks in".

August 27, 2007 @ 7:45 PM - a first bounce into the [$xxx] area might be rejected and followed by a downside retracement into the [$xxx] area. We believe this is the area where the "true" bottom is formed.

The newly setup, QQQQ Put Option is carried an amazing unrealized gain of 90% in just 1 session.

 

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技術前瞻：大盤可能下探近期低點

Editor's Note: this is the free edition of the Market Outlook. To receive the daily edition everyday before market open, please subscribe. It's now available at a monthly rate.

這是Capital Essence對2007年8月28日 (週二) 的市場技術分析。

不出所料，股市昨天在新一輪的獲利回吐中全面低收。股市全面疲軟的原因在於一份不利的房產報告。報告指出未售出的單戶住宅數量上漲了2.2%，達到385萬棟，相當於9.2個月的供應量，創下了自1991年10月以來的最高水平。這一數字表明房產板塊還遠沒有穩定下來。

僅從圖表中看，房產板塊正在三年的趨勢支撐位置遭遇買家不足的困難。這是不利的現象。請記住，如果該指數持續跌破上週低點，將表明2003年早些時候的看漲突破點——約為120點將再次受到考驗。該點距此相差50點或者30%。

來看主要股指：

上面是標普500指數的短期日線圖。在上週的前瞻分析中我們已經指出："反彈可能在1475點位置附近失去動能"。而當前的上漲趨勢剛好止步於長達4周的下跌趨勢線——約為1475點附近。我們說過，如果大盤突破該阻力位失敗，8月16日的低點將被重新考驗。

上面是道指的中期周線圖。和標普500指數類似，該指數昨天同樣考驗了長達4周的下跌趨勢線的阻力位。如果判斷沒有失誤，該指數將不得不跌落至8月16日低點附近以尋找買家。今天該指數跌破13200點將確認這一點。

總結：週一的交易狀況表明週二的盤面將趨於負面。預計波動將持續至週末。

Bearish bias

Editor's Note: this is the free edition of the Market Outlook. To receive the daily edition everyday before market open, please subscribe. It's now available at a monthly rate.

Good Morning. This is Capital Essence's "Market Outlook" (the technical analysis of financial markets) for Tuesday August 28, 2007.

As predicted, equity market closed lower across the board amid a fresh round of profit taking. Contributed to the overall weaknesses was a troubling housing report. The unsold single-family homes inventory rose 2.2% to 3.85 million, which represents 9.2 months supply. That's the highest level since October 1991, suggesting that housing sector might be far from stabilizing.

(Click on image to enlarge)

As far as the chart concerns, the housing sector is having trouble finding buyers at the area of the three-year trend-line support, which is very bad. Bear in mind that a sustain decline to below last week's low indicates a retest of the early '03 bullish breakout point, around 120. And that is about 50 points or 30% from here.

Let's take a look at the major index charts:

(Click on image to enlarge)

The Standard & Poors 500 Index (daily) chart above addresses a short-term frame. We've opined right here in last week Market Outlook that "the rally is likely to run out of steam around the 1475 area" – see "The rally still has a leg albeit small one" August 23, 2007; the current advance appears to stall at the area of the four-week falling trendline, around 1475. As mentioned, a failure to take out this resistant indicates a retest of the August 16's low.

(Click on image to enlarge)

The Dow Jones Industrials Average (weekly) chart above addresses an intermediate-term frame. Similar to the S&P 500 Index, the blue-chips index also tested resistant at the area of the four-week falling trendline. Should the textbook stands true, the index will have to move down into the area of August 16's low to find buyers. A decline to below 13200 will confirm this.

Bottom line: Monday's trading action suggested a negative bias into Tuesday trading session. Expect volatility to shoot up into the long weekend.

Until next time, good luck.