Friday, 26 October 2012

Red into the weekend?

Today saw the bulls begin another early morning lurch higher, but it failed. It is this second failure in a row that I find particularly bearish. With the VIX hourly chart offering big upside this Friday, and into next week, things could be about to get real exciting.




First, a brief note on AAPL/AMZN.

AAPL is still immensely profitable, but clearly its a little concerned about early 2013. In AH trading, it broke the monthly 10MA, hitting 585 - suggesting a move to $500 in the next month or two.

AMZN, razor thin margins....and margins, with a 23 cent loss per share. In AH trading AMZN broke the key $210 level, briefly hitting 204. Target is now a very clear $150.

Bearish end to October?

So far the decline from 1474 to 1412 is still a tiny move of barely 4%. All those bull maniacs calling this decline 'significant'..have clearly lost any sense of perspective. 

The weekly chart suggest a move to 1325/00 is viable within the 'very near term'.
The monthly chart would allow a multi-month move as low as sp'1200/1175.

Certainly, the low 1200s would make for a very tasty 'dip buying' level, even for those permabears out there, including yours truly! Right now, even a move to the low 1300s would seem out of range to most traders, but hey...we've seen a few 'surprise' major declines over the last few years. We're due another one. 

A stinky red Friday?

As for Friday, we have Q3 GDP data before the open, a number <1.5% should be enough to cause at least some market concern. The consensus estimate is for 1.9%, which seems bizarre, especially when you consider the earnings reports in recent days.

It will also be interesting to see how AAPL and AMZN trade across Friday. Considering their respective results - and AH price action, I'd look for them both to at least close moderately lower.

Goodnight from London