Is Downtown Josh Brown Whistling Past the Graveyard?

“Downtown” Josh Brown named JPM his final trade today for the half-time fast money show.  Is he correct in his expectation that JPM is a screaming buy here?  Only time will tell, but there is a lot of overhead supply facing the market and JPM here after the damage done by the market in October.

JPM – 65-Minute Chart #1

If my read of the overall market corrective pattern is correct (i.e., ABC correction), then JPM is likely to find resistance in the SLOT and pull-back one more time.  That pull-back may make a higher low which will be bullish or it could follow the market down and make a lower leg (i.e., a final C-wave move).

There are lots of buyers of JPM during the market weakness that may be willing to sell their shares if they can get back to break-even.

JPM – 65-Minute Chart #2

The whole run-up in JPM from this past summer has also produced a lot of stranded traders down here at the current levels … the Point of Control that needs to be taken out before I would consider JPM bullish would be that $113.50 – $115.50 zone vs the $108.00 current price.

Cheers … Leaf_West

Is Dan Nathan Correct???

It is no secret that I like how Dan Nathan thinks … he appears to be one of the most rational traders that CNBC dares show on their daily programming.  Dan has been saying for the past several weeks that the recent corrections in the momo, high-beta, over-crowded, super-cap tech stocks are going to be hard to recover from.  Dan argues that this would seem to imply that the overall markets are also going to have a hard time making it back to recent all-time highs.

Is Dan right?  The basis for Dan’s argument lies in the fact that many traders are trapped in these mega-stocks at much higher prices and will, to a large degree only be too happy to let some stock go if/when these stocks ever get back up to their recent highs.  That is what is going to create problems for the market in any bounce from this week’s lows.

Let’s take a look at the volume profiles for the FANG stocks along with AAPL which is going to report its earnings and the all-important Xmas season outlook today after the close.  Let’s start with AAPL … Continue reading

Overhead Supply / Resistance Areas …

Tonight’s AAPL earnings report is pretty key for the market … if the outlook is disappointing, then all bets are off about what could happen in the market the next several days.  I still think that the market is set-up to bounce higher into the SLOT resistance zones and therefore I want to do my work and be prepared for that next move into the final resistance levels.  Here are some looks at the volume profiles for the two key futures contracts that I trade. Continue reading