TCM Notes : 10/2/09

• We kick the 4th quarter off with a bout of selling again on Thursday. While most indices escaped another day of distribution the Nasdaq was not so fortunate. IBD has changed it's market outlook to "uptrend under pressure." Count stands at 5 for Dow, 4 for SP500, and 3 for NYSE and Nasdaq. Thursday's action was very similar to Sep 1st's action. GS lowered their job number estimate to -250k in line with what was seen from the ADP numbers today of -254k. The street is looking for -175 to -180k jobs. Not sure if we have another "less worse" rally in store. Generally these job numbers have been bought into the last few times and a trend day up has been the result. We'll know soon enough if this is the case.
• As noted in my Sep 14th UYG pattern piece we are getting near my "ultimate load up zone" in this etf. 4.71 to 5.13 is that area. Currently it aligns itself with the 23.6% fib line and the 86ma. Currently I had an after hours order in the system for a few thousand @ 5.40 or the 50ma. 5.43 was as low as UYG ticked in the after hours. I'll be looking pre market to see if the selling will exhaust itself before the market open. Jobs number will be the key to the day.
• TWI coming back down to it's 200ma would be an ideal spot to try a few long shares. GTI hitting back down in this channel between it's 38.2% and 50% line looks like it might be good for a few. HF at 6.09 would be a good spot for a few if it can hold that level which is it's 23.6% fib line. KFN still trading below management's stated book value of 5.79. Appropriate stop measures should be put in place as always on new buys. 7% stop is the rule of thumb.
• Doug Kass points out in his Thursday piece that the ISM was one of the indicators that got the upside move juiced up. It's disappointing showing the other day has juiced up this move we're seeing to the downside. If indeed SP500 eps turns out to be 73$ as is expected for 2010, then the current forward multiple rests at 14.17 +/- for the SP500. This is a level that could be perceived as "value," but we have seen instances of single digit multiples several times before. Albeit inflation levels were much higher when those single digit multiples were achieved. So whether the market is offering "value" at these levels is a hotly contested notion at best. The bears are becoming more emboldened as we sell off here. Opportunity is being created again. For whom though is up to Mr. Market to decide.
• I did get filled for a small buy of GRRF at the 50ma of 4.42. Stock closed a few pennies underneath it. Stronger support lies beneath at the 4 level. I've been buying this one on weakness since it's earnings gap in early August.