Airlines have been recently strong on Oils decline but have yet to break upper resistance. UAUA is one that I have puts on and sported a nice shooting start pattern today. I'm looking for this one to get back to the $9 level as Oil rises next week.
MMM is another good short. It has risen nice over the past month but is hitting major Fib levels and is due for a trip back to the $57.50 level at the least. I currently have my stops above the upper Fib retracement level.
BAX is a favorite of mine right now. I have fairly long term puts on this as the 10-year (which is not shown) illustrates a major reversal for this stock. The most recent rebound which brought it to current levels is close to breaking. Notice the shooting start top three days again that held tight, in addition to Fib resistance levels. If the market turns sour, BAX should be south of $50 fast.
Okay, let's re-cap the week. We had practically horrible news almost everyday and yet we put together a nice rally this week. I personally think that its justified only in stock values (i.e. some major companies were ridiculously cheap) and the fact that we were technically way over-sold. Still, with companies laying-off employees left and right, and consumer spending dropping, we have much more room to go lower. Just because analysts lower their estimates so much that every company is "beating estimates" doesn't mean anything; these companies are still losing money! I would like to see the market make a successful re-test of the October lows before getting crazy and buying stocks for long-term holds.
Happy Halloween!
