The Art of Leveraging Feeble Buying

DaBoyz more than held their own Wednesday, keeping the Dow airborne for six hours even though buying interest was practically nil. This is an achievement of sorts, and it suggests that although upside potential will be limited to whatever the stock market’s masters can milk from daily mood swings, there would appear to be little enthusiasm for a hard selloff at the moment. In such circumstances, the blue chip average, currently trading for around 24,600, could waft above 25,000 with little ado.

That number is psychologically important because it is where investors would start to believe that a rally to new all-time highs is actually possible. From a purely technical standpoint, the chart suggests that a decisive push past the 24,736 ‘midpoint pivot’ would put the Indoos on track for a move to as high as 25,229 over the next 3-5 days.  The Dow is already trading above the 24,332 midpoint of the steep correction from early October’s all-time high, but it won’t run into serious supply until around 25,200, where tons of stock changed hands between bulls and bears in the sine wave of late October/November.

Housing Slump Deepens

It seems incredible to me that stocks could make any headway at all, given the darkening economic picture. It grew still more ominous Thursday with this headline atop the front page of the Wall Street Journal: “Slump in Housing Market Deepens. What could cause this situation to change so suddenly as to make possible a run-up in the Dow to new highs? My imagination fails me on this question. Barring some epiphany, I’ll continue to see every new inch of the uptrend that has unfolded since Christmas as an increasingly juicy opportunity to get short.

  • John Jay January 24, 2019, 10:12 am

    And don’t forget Henry Kissinger 1973!
    LOL!
    However to their credit, some years no one gets the Peace Prize.
    1914 to 1916 Not awarded
    1939 to 1943 Not awarded
    Some other years too:
    https://simple.wikipedia.org/wiki/List_of_Nobel_Peace_Prize_winners

  • John Jay January 23, 2019, 7:58 pm

    Robert Shiller Nobel prize winner in Economics in 2013 believes there “is a risk of a full blown bear market.”
    Wow!
    Nobel Prize winner in Economics!
    From Yale no less!
    He should know best, right?

    Except there is no Nobel Prize in Economics.

    “But, technically, there is no Nobel Prize in economics. Instead, there is the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel. It was first awarded in 1969 and is named not after a person, but after the central bank of Sweden — the Sveriges Riksbank — which funds it.”

    https://fivethirtyeight.com/features/the-economics-nobel-isnt-really-a-nobel/

    LOL!

    So it is in the same category as the “Academy Awards” that the Movie industry dreamed up in 1929!

    The Central Bankers dreamed up a “Nobel Prize in Economics” in 1969 and pasted it onto the real Nobel Prize ceremony starting in 1969.

    Economics professors remind me of Psychiatrists that I read once have a lower success rate than Witch Doctors!

    That link will take you to the complete story.

    &&&&&&&

    The Nobel Committee routinely disgraces itself, although awarding peace prizes to Arafat, then to Obama, will be hard to top. In the economics category, there was an award to the half-strength-Marxist nut-job Paul Krugman, who now, and for all eternity, will be privileged to be known as Nobel laureate Paul Krugman. He isn’t quite that, according to your post. RA

  • none January 23, 2019, 6:50 pm

    GC advancement in this time frame may become quite an effect towards sentiment, the target pricing of 1583.3 level may become an over night success as they say in the music business like a new ‘rock and roll star’.

    Have a great day Rick tomorrow.

  • none January 23, 2019, 6:43 pm

    Today’s closing indexes being higher and negative breath and volume ratio lower are in place towards a day of inharmonious action.
    These are places that suggest the main trend (downward) is in change and very soon to continue.

    Being that the indexes have and are running twice the speed in pricing and less than 1/2 in the way of time to create a new long term trend lower in weeks and months (an impulse longer wave). Suggest that the market will ‘catch up’ in time, of ‘adjust’ in time, meaning will move lower quickly but only a new slightly low and extend trading range of the recent high (01/18) and the new low coming.

    Or, move price with a forceful stage towards a measure move of the last downward wave at the start of the entire process. If so this will then support the market to adjusts its ratio towards the stair step downward price action that has an extremely fast pace in place. INDU 19.5k is a target.

    The NYA stocks > 200 DMA hit the extreme 12% level, this is an extreme weak level for such a move in the 1st phase of a new turned market downward. These levels of 10-12% are not seen until at less a 30-40% index correction level. This is ‘massive’ damage on a longer and larger scale than many see at this early stage in time.

    The A/D line has created a new or near all time high, 30% of the A/D line stats are not stock issues and do not no longer reflect’ the over all market internal market strengths or weaknesses.

    INDU 19.5K level is a major support level for a rally of sorts to last in weeks and a few months, the problem with this level is the large over hanging supply of 10b-18 rule investment by companies during the trading year of 2018. For these accounts run the same as any other and there are subject towards ‘margin calls’ at stress equity levels of capital. Take note this level 19.5K is about 20% of losses towards the massive buy programs of that INDU 2018 trading range, a ‘break away’ or a ‘margin call’ towards these investment level. Calls are subject like any other accounts they must rise towards 33% equity value the call itself cannot just be to offset the losses.

    Support for stocks in time come in about the late Feb/early Mar time period.

    Of course as always we shall see.

    Have a great day tomorrow Rick.