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Charles E. Kirk of The Kirk Report May 9, 2008 Email this article to a Friend  Printer friendly page

Good morning. As oil prices hit fresh new highs, more bad news from the financials are bringing out the sellers this morning.

As we head lower, traders will be watching whether any support can be found at the 20 Day MovAvg (1385) and 50 Day MovAvg (1350) in the S&P and how much volume picks up in the selling.

Premarket gainers: PCLN, DAR, GSIT, RNWK, INT, BSQR, NAT, QSFT, POM, DROOY, LUNA, NVDA, TRLG, RICK, ATVI, SONS, TTES, CC, FSLR, HRBN, and LINE.

Premarket losers: AIG, CCOI, NGAS, AGO, MGI, C, BID, DRAX, BID, BRKS, SNY, LLNW, PDLI, SWC, FMD, MYL, BMY, PEC, AAUK, EMKR, ACGY, and SAPE.

We know from sentiment readings from AAII this week that bullish sentiment among individual investors show that most do not expect the market to roll over now. A nice illustration of that sentiment change can be found in Jason Goepfert's smart money / dumb money confidence index:

As smart as it was to fade negative sentiment back in March, we're dealing with a much different setup right now. One that clearly seems to need a constant stream of positives to keep things moving higher which simply hasn't been happening this week.

by Charles E. Kirk (The Kirk Report )

Disclaimer:

Please note that charts and commentary provided by the moderator are for educational purposes only. Any trades placed upon reliance on the moderator’s charts or information is taken at your own risk for your own account. Past performance is no guarantee of future results. While there is great potential for reward trading stocks, futures and options, there is also substantial risk of loss and you must decide your own suitability to trade. Future trading results can never be guaranteed. This is not an offer to buy or sell stock, futures, options or commodity interests.

Most trading systems are based on historical formulas which have worked in the past. However, what has happened before may or may not happen again. You can lose all your money trading stocks, futures, and options and you must decide your own suitability as to whether or not to trade. Only trade with true risk capital you can afford to lose. Only trade markets you can properly afford to trade. Properly funded trading accounts typically perform better than those that are not. Never risk more than 2-3% of your account on any one trade. Always define your risk before entering a trade and place a stop to limit your risk.

There are no guarantees or certainties in trading. Trading involves hard work, risk, discipline and the ability to follow rules and trade through any tough periods during a system’s draw downs. If you are looking for a guarantee, trading is probably not for you. Most people lose money trading. One of the reasons is that they lack discipline and are unable to be consistent. A system can help you become consistent. Ironically, worrying about the monetary aspect of trading can contribute to and cause a trader to make trading errors. Therefore, it is important to only trade with true risk capital.