Projection of the Dow the remainder of the week.

The Dow, Nasdaq and S&P 500 all dropped today. The dow was down over 100 points and the question is what is the prognosis for the rest of the week. To take a look at the charts for a moment, you will see the Dow as compared to the stocks which have been leading the rise. The summary is that these leaders are actually much ahead of the Dow's drop so far and so I believe this is these will lead the Dow lower in the coming days. The only question remaining is whether we will go below the previous low which occurred on March 16th.

Market comments for Dec. 9th

As you can see I haven't posted many comments on the market these past few days. There really hasn't been a reason to as nothing has really changed. On thing I wanted to add though was to watch the stock price of CAT, because it has led thus year's rally. But the last couple of days it looked like it topped and today it is forming a Hammer Candlestick pattern, which often is a sign of a reversal in trend. I have a 2 month chart on CAT below so you can see what I am referring to.

Surprised by today's market action

Yes, I was surprised by the market action today. With so many layoffs and missed earnings by Caterpillar, I thought the market would take a step down. Volume was lighter than Fridays so we will know more by Wednesday, when the Fed completes its 2 days of meetings. Maybe many believe the bad news is already baked into this market, but I doubt it is. I am willing to be a believer with real data. I did not sell TNA nor SSO as I was looking to add to my positions on any drop. But it didn't happen today. I truly think we will all make at least 20-25% on this round trip for these ETF trades and I predict, again, within a 6 week period. That does not preclude a trip lower. If you are smart, buy on dips down and accumulate, because I think this next move up will be more like a sling shot, quick and far. Predicting the market direction means being in tune with the news and predicting outcomes there as well.

More layoffs announced today and it's only Monday morning

News of the morning is that Caterpillar is cutting 20,000 jobs, Home Depot is cutting 7,000 jobs and exiting the expo business, Pfizer will buy Wyeth for $68 Billion and layoff 19,000 people while closing 5 factories and Starbucks is talking about 1000 additional layoffs at its headquarters, as well. And this is just Monday morning!

Click on any company name and be taken to the story source.

UPDATE: 7:10am PST

Additional layoffs announced are from Sprint, 8,000 jobs, ING, 7,000 jobs, Phillips Electronics 6,000 jobs and GM laying off 2,000 jobs. That is a heck of a start to the week!