Jeff Cooper: "Watch Price Action Carefully"
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Jeff Cooper: "Watch Price Action Carefully"
Jeff Cooper, analista técnico do Realmoney, que tem estado bullish há muitas semanas, começa agora a ficar cauteloso e a acreditar numa inversão para breve.
"Watch Price Action Carefully"
By Jeff Cooper
Street Insight Contributor
6/17/2005 7:00 AM EDT
"Right on track and according to schedule, stocks continue to sneak higher.
Wednesday's outside day up was, in fact, the tipoff for a push to test the highs of the year heading into Friday's quadruple options expiration.
For those of us long the market, this move is nice to see. But I cannot attach too much significance to it. In other words, the pickup in volume and price is likely being dominated by the arbitrage and technical considerations revolving around this expiration.
Then, of course, there is the old fun and games of "Pin the Tail on the Donkey" -- that is, the proclivity of stocks to be magnetized to meaningfully higher and lower prices into expiration. Of course, stocks do not move, they are moved. That means the boyz are at the helm. The lure of buying cheap options and jamming a stop to the next strike prevails.
As the ninja would say, "Though your sword is above my heart, I shall prevail." The sword of market risk is always above our intuition. But the sword cuts both ways. We prevail if we do not become overly emotional. It is a delicate trading acumen that balances intuition with the propensity to get overly emotional.
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That said, the market knows this and does a good job of getting the staunchest bears to turn bullish -- often very close to the top. Right now, the negative sentiment of the April lows has been well worked off. That does not necessarily mean that we are not going higher. But we have to watch postexpiration activity, namely price action, carefully.
If there is a meaningful top being traced out in this time frame, the market will reveal itself in a spike that will occur over three to seven days. Otherwise, the market will continue to grind and back and fill.
Conclusion: The projection that I have laid out of a run toward 1260 S&P into the end of June/early July is on course. If that target is hit going into that time frame, and it occurs on a whoop-'em-up or a spike, I would certainly be selling some stock into it. "
(in www.realmoney.com)
"Watch Price Action Carefully"
By Jeff Cooper
Street Insight Contributor
6/17/2005 7:00 AM EDT
"Right on track and according to schedule, stocks continue to sneak higher.
Wednesday's outside day up was, in fact, the tipoff for a push to test the highs of the year heading into Friday's quadruple options expiration.
For those of us long the market, this move is nice to see. But I cannot attach too much significance to it. In other words, the pickup in volume and price is likely being dominated by the arbitrage and technical considerations revolving around this expiration.
Then, of course, there is the old fun and games of "Pin the Tail on the Donkey" -- that is, the proclivity of stocks to be magnetized to meaningfully higher and lower prices into expiration. Of course, stocks do not move, they are moved. That means the boyz are at the helm. The lure of buying cheap options and jamming a stop to the next strike prevails.
As the ninja would say, "Though your sword is above my heart, I shall prevail." The sword of market risk is always above our intuition. But the sword cuts both ways. We prevail if we do not become overly emotional. It is a delicate trading acumen that balances intuition with the propensity to get overly emotional.
Related Stories
S&P Chasing Its 'Tail'
The Big Bang Theory
S&P May Have Seven-Year Itch
That said, the market knows this and does a good job of getting the staunchest bears to turn bullish -- often very close to the top. Right now, the negative sentiment of the April lows has been well worked off. That does not necessarily mean that we are not going higher. But we have to watch postexpiration activity, namely price action, carefully.
If there is a meaningful top being traced out in this time frame, the market will reveal itself in a spike that will occur over three to seven days. Otherwise, the market will continue to grind and back and fill.
Conclusion: The projection that I have laid out of a run toward 1260 S&P into the end of June/early July is on course. If that target is hit going into that time frame, and it occurs on a whoop-'em-up or a spike, I would certainly be selling some stock into it. "
(in www.realmoney.com)
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