Listen to & Buy the New Stock Market Blues Song!

Listen to & Buy Stock Market Blues Here

Stock Market Blues is a song about how NOT to get the stock market blues, with an Amusing, Educational lyric full of age-old Wall Street axioms, cliches, great advice.

Unusual rhymes will make you smile and recognize the rhythm of Wall Street. A Smooth Jazz Melody written & performed by Kevin Disimone of Bloodline, accomplished musician and songwriter. Lyrics by Robert, Trading Strategist at AlphaKing.com which Made 70% Return in 2008 and updates, publishes performance daily for all to see!

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Reversal Rally May Come Soon!

Trader Talk

The short term momentum oscillators remain negative, confirming the bearish stance of the AlphaKing Trading indicator. The accumulation/distribution profile remains negative, with no high volume follow-through advances to confirm any of the big up days since the crash landed in September and October. The leadership profile also remains very bearish, with 46 stocks making new 52 week highs versus 2,576 stocks making new 52 week lows.

The 4% rule remains negative, while Federal Reserve policy remains positive. The VXO volatility indicator closed the week at 76.2, starting a new spike up in fear, though still shy of the spectacular number that suggests this bear plunge is over. The primary Elliott wave count suggests a wave 5 meltdown remains underway, with today's pop a minor wave iv of an expected 5 wave move that should see recent news lows breached on a closing basis. What should follow this wave 5 plunge (to end the giant wave 3 that started in May,) is a mega rally to start a giant wave 4. In other words: still lots of bear to go, though getting ready for a big bounce much larger than we've experienced so far this year.

Traditional seasonal trends have us looking for a rebound following a capitulation collapse in the 4th quarter, while the Presidential cycle remains bullish for the remainder of 2008. The Benner-Fibonacci cycle will remain bullish until 2010, though this prolonged time period may include one or more cyclical bear phases. The AlphaKing combination cycle sees a bear market slump running all the way into mid-December when the next major turn-date is slated to land.

Summary:

This week saw the capitulation melt-down we wrote about last week commence for real, and today's snap-back appears simply a partial counter-trend rally within than larger melt-down run. While this melt-down run can see much lower prices for the stock indexes, this is the time to be thinking about where to buy, rather than following the dumb money in believing the financial world is about to end. Indeed, our biggest fear should be missing the entry boat on this very well telegraphed plunge - and thus the stock market take off without us on the expected mega rally headed our way fast - rather than trying to milk every last dime of profit on short positions.

This market has opportunity written all over it. Want to make 20, 30, 50% on your 401K? Then this is the kind of technical set up where that can be delivered, and in very short order (as the shorts get creamed on the recovery bounce soon to come.) So get your mind together over the weekend as to what you want to do on the long side. Staying in cash while the AK Trading indicator remains in sell mode is not the dumbest thing one can do - those bulls who stayed long this year while the AK indicator was in sell mode have that covered - though we plan to move the AK portfolios to the long side on any move to new lows next week.

We have studied bear markets, and there is nothing about this one that says it will break from its traditional breakdown followed by recovery pattern. Wave 1 and 2 were the topping action earlier in the year. Wave 3 was the meltdown that landed in September/October/November (which is still playing out), and thus what should follow the sharp spike down below the October 10 lows is a wave 4 sideways churn trading range pattern with Dow 7000ish as the bottom, and Dow 10,000ish has the top. Do the maths. That's a near 50% rally for the Dow (and you can bet we'll be buying something with a little more Ommph! than the Dow.) Since wave 4s are M shaped rally, pullback, rally, pullback moves - within a very wide trading range over the prolonged periods of time - these near 50% moves should land multiple times before wave 4 is complete. Yes, this will likely end very badly for the bulls - as this great bear is for real - though wave 4s of this magnitude offer tremendous amounts of profits for those looking ahead with a wary eye on what comes next. We expect to act very early next week, possibly as early as Monday. The more red ink we see the more comfortable we are in buying long.

Have a nice weekend.

Kevin Wilde, Chief Trading Strategist, AlphaKing.com

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"Stock Market Blues"

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Listen to & Buy the New Stock Market Blues Song!

Listen to & Buy Stock Market Blues Here

Stock Market Blues is a song about how NOT to get the stock market blues, with an Amusing, Educational lyric full of age-old Wall Street axioms, cliches, great advice.

Unusual rhymes will make you smile and recognize the rhythm of Wall Street. A Smooth Jazz Melody written & performed by Kevin Disimone of Bloodline, accomplished musician and songwriter. Lyrics by Robert Bendekgey, Trading Strategist at AlphaKing.com which is UP 95% year to date thru 11-19-08 and updates, publishes performance daily for all to see!

No, Stocks Haven't Hit Bottom Yet!

Talk is Cheap. See our Actions updated daily: http://alphaking.com/performance/

Trader Talk
The short term momentum oscillators remain negative, confirming the bearish stance of the AlphaKing Trading indicator. The accumulation/distribution profile remains negative, with no high volume follow-through advances to confirm any of the big up days since the crash landed last month. The leadership profile also remains very bearish, with 10 stocks making new 52 week highs versus 503 stocks making new 52 week lows.

The 4% rule remains negative, while Federal Reserve policy remains positive. The VXO volatility indicator closed the week at 70.3, starting a new spike up in fear. The primary Elliott wave count suggests a wave 5 meltdown remains underway, with yesterday's pop a minor wave ii of an expected 5 wave move below the October 10 crashing lows.

Traditional seasonal trends have us looking for a rebound following a capitulation collapse in the 4th quarter, while the Presidential cycle remains bullish for the remainder of 2008. The Benner-Fibonacci cycle will remain bullish until 2010, though this prolonged time period may include one or more cyclical bear phases. The AlphaKing combination cycle sees a bear market slump running all the way into mid-December when the next major turn-date is slated to land.

Summary:

Look, there is going to be one helluva rally coming out of all this churn, but our technical works says we have to suffer one last clean-out crash before this monster rally lands. We have experienced many one-day-wonder false starts to this expected advance since this bear started, and the failure of these rally pops is testament to the internal technical weakness that suggests very strongly that the October 10 lows are not the technical lines in the sand from which a more lasting bull surge will emerge. Indeed, the on-going five wave mega plunges, followed by big - though lesser - three wave partial recoveries, suggest the bulls are fast running out of time before the next killer clean-out plunge lands. Focusing in on the move above the 20 day moving averages (gold line) in the charts below that landed a week of so ago, we can see the peak as a head of a head and shoulders top, with the recent move back (yesterday and today) to retest the 20 day MAs as part, or whole, of the right shoulder. That puts yesterday's low, and the October 10 lows, as the neckline where raw capitulation resides. We've seen this movie before, and it doesn't end well for the bulls who see yesterday's bounce as the end of their misery. What really happened yesterday was the stock market landed on the mortician's table only to croak a barely audible: "I'm not dead yet." Now the mortician is a tad deaf, and the starting the bone saw doesn't help, so our advice is you better be ready for some terror and horror to come as we get to see exactly what the bulls are made of...

Have a nice weekend.

Kevin Wilde, Chief Trading Strategist, AlphaKing.com

For Free charts with trading signals and fundamentals ratings, visit AlphaKing

Stocks: Bottom NOT in Yet!

Trader Talk
The short term momentum oscillators remain negative, confirming the bearish stance of the AlphaKing Trading indicator. The accumulation/distribution profile remains negative, with no high volume follow-through advances to confirm any of the big up days since the crash landed earlier this month. The leadership profile also remains bearish, with 18 stocks making new 52 week highs versus 205 stocks making new 52 week lows.

The 4% rule has turned positive, confirmed with bullish Federal Reserve policy. The VXO volatility indicator closed the week at 62, showing some modest pullback in fear. The primary Elliott wave count suggests a wave 5 of 3 meltdown run is slated to land anytime soon as wave 4 counter-trend advance stalls and reverses into what should see one more crash to major new lows for the stock indexes.

Traditional seasonal trends have us looking for a rebound following a capitulation collapse in the 4th quarter, while the Presidential cycle remains bullish for the remainder of 2008. The Benner-Fibonacci cycle will remain bullish until 2010, though this prolonged time period may include one or more cyclical bear phases. The AlphaKing combination cycle sees a bear market slump running all the way into mid-December when the next major turn-date is slated to land.

Summary:

The up/down violent trading action was in play once again this week, with this one ending nearer the top of the recent trading range. The technical set-up calls for the bulls to be handed yet another beating that their complacent: "The bottom is in!" mantra deserves. Bear markets are all about crashing moves followed by straight up advances as the bulls get tricked into believing the bull is back. While we don't claim perfection, we did lock in some profits on the big dip earlier in the week, while adding new short positions as the sucker rebound unfolded. We would have liked to lighten up more on the dip, but one thing about the current volatility is the big moves offering very little chance to get in or out of positions. Since the close on Friday was the fourth consecutive up day, we are very confident that next week should see a reversal of this week's gains. Yes, it's election week. Yes the European central bankers will cut interest rates. Yes, it's the start of a new month. Despite all that manipulative potential, our technical work says the best the bulls can hope for next week is some sideways churn, though our confidence level is super-high that the week will end in a victory for the bears no matter what happens earlier in the week. Not even the famous rebound off the 1987 crashing lows - a favorite of the buy-and-hold crowd - went higher from this position without falling in one last gasp five wave plunge. And that was only a correction within a secular bull market. This is something much more dire, and real. When our indicators say to buy we will buy with both fists and then some. But first we get to see how the financial markets handle the next capitulation plunge...

Kevin Wilde, Chief Trading Strategist, AlphaKing.com

For Free charts with trading signals and fundamentals ratings, visit AlphaKing

Stock Market in Crash Mode

The short term momentum oscillators remain negative, confirming the bearish stance of the AlphaKing Trading indicator. The accumulation/distribution profile remains negative, with zero high volume accumulation days to counter a slew of high volume distribution days. The leadership profile also remains very bearish, with 21 stocks making new 52 week highs versus 2,008 stocks making new 52 week lows.

The 4% rule remains bearish, while Federal Reserve policy remains bullish. The VXO volatility indicator closed the week at 79, continuing the bull market for fear. Please note the high for this sentiment gauge is a whopping 172 during the 1987 crash, so while we remain at super-high levels, the fear spike may have a lot more to run. The primary Elliott wave count suggests a wave 5 of 3 meltdown run is in play, and should result in yet another crashing plunge in very short order.

Traditional seasonal trends have us looking for a rebound following a capitulation collapse in the 4th quarter, while the Presidential cycle remains bullish for the remainder of 2008. The Benner-Fibonacci cycle will remain bullish until 2010, though this prolonged time period may include one or more cyclical bear phases. The AlphaKing combination cycle sees a bear market slump running all the way into mid-December when the next major turn-date is slated to land.

Summary:

Oh, my, what another WOW! week. The news remains grim, and can be expected to remain grim. The internal count calls for more downside action, and more severe pain for the bulls. While they may be able to drag the next plunge out with more sideways action going forward, the odds of probability remain super high the bears will have their day in a big way in the non-too-distant future. Markets around the world broke through critical support on Friday, and the US indexes are hanging by a torn finger nail to their must-hold-at-all-cost technical lines in the sand levels. The remainder of the year should see the bulls enjoy a respite rebound at some point - once the capitulation plunge takes another pound of financial flesh - but those looking for an end-of-year rally to help save the day should think again, for the overall technical set-up suggests a great deal more bear misery should land before we hit any lasting bottom. When our indicators say to buy we will buy with both fists and then some. But first we get to see how the financial markets handle the next capitulation plunge.

Kevin Wilde, Chief Trading Strategist, AlphaKing.com

For Free charts with trading signals and fundamentals ratings, visit AlphaKing

Bear Market Still Growling!

Trader Talk
The short term momentum oscillators remain negative, confirming the bearish stance of the AlphaKing Trading indicator. The accumulation/distribution profile remains negative, with a lack of any high volume follow-through days to confirm of any recent rally attempts. The leadership profile also remains bearish, with 49 stocks making new 52 week highs versus 344 stocks making new 52 week lows.

The 4% rule remains bearish, while Federal Reserve policy remains bullish. The VXO volatility indicator closed the week at 71, continuing the bull market for fear. Please note the high for this sentiment gauge is a whopping 172 during the 1987 crash, so while we remain at super-high levels, the fear spike may have a lot more to run. The primary Elliott wave count suggests the wave 3 of 3 meltdown run is nearing the end of the crash phase. We believe we are currently in a wave 4 trading range with a fifth wave capitulation collapse still to come.

Traditional seasonal trends have us looking for a rebound following a capitulation collapse in the 4th quarter, while the Presidential cycle remains bullish for the remainder of 2008. The Benner-Fibonacci cycle will remain bullish until 2010, though this prolonged time period may include one or more cyclical bear phases. The AlphaKing combination cycle sees a bear market slump running all the way into mid-December when the next major turn-date is slated to land.

Summary:

There are no words to describe the trading action this week beyond WOW! Monday saw the S&P500 up 12%, and then Wednesday saw the worst one-day plunge since the 1987 crash with a 9% pummeling, to be followed by Thursday's 4% rally going into options expiration Friday. What a week. We shorted at the open Tuesday, and then again at the open today. That tell you what we think is slated to land next? Volume dried up the closer to Friday we got. The economic news was grim. Next week is all about earnings, with some really important stocks and sectors reporting each and every day next week. This sets up even more volatility than we experienced this week. Almost everyone accepts we are currently in a recession - about a year after we started on the recession drum - and the question now has moved into how bad is it going to be. Very bad, is our first impression, and one has to look no further than stock market action this year to see what that important economic forecasting indicator thinks about our economic plight going forward.

We have our plan for what comes next, and we should have a giant head's up as to when the expected plunge is nearing its end. We expect things to get worse before they get better. When our indicators say to buy we will buy with both fists and then some. But first we get to see how the financial markets handle the capitulation plunge end game.

Kevin Wilde, Chief Trading Strategist, AlphaKing.com

For Free charts with trading signals and fundamentals ratings, visit AlphaKing