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"Grizzly's
Daily Growl" Archives - Oct. 2001 © 2001 bearmarketcentral.com. All rights reserved. |
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Special Note From Grizzly This week, the premier market analysts at Elliott Wave International are giving you a FREE ticket to every single one of their market forecasts. Have a look at these famous analysis services:
Financial Forecast, In all, these subscriptions cost $2,200 per year, available to you completely FREE! All week long, you, your friends, and your colleagues will be treated to SPECIFIC market forecasts for the Dow, the Nasdaq, the S&P, the Nikkei, Bonds, Gold, commodities, currencies, and much, much more, all 100% FREE! Just click here to sign up for your free login ID and password, and you'll be have immediate access to these invaluable services. Free week starts Wednesday, October 31 and ends Wednesday, November 7th, so don't delay, sign up today! And don't keep a good thing to yourself. We encourage you to relay this great offer to your chat groups, friends, and colleagues too. Just click here to Email This Offer to a Friend and they'll be ready to go! |
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Special Update From Grizzly Taking much of the rap for today's sell-off was the Conference Board's Consumer Confidence Index, which came in at a somewhat shocking 7-1/2 year low of 85.5, down from 97 in September. The Street anal-ysts were expecting a reading of about 96. (Why does anyone pay any attention to these "experts?") The consensus on The Street is that this week's sell-off is just a brief pause in a long-lasting rally from the September 21st lows, creating another "buying opportunity." As contrarians, we beg to differ and expect the sell-off to continue for much longer and to much lower levels than most others expect. Given the sharp drop over the last two days though, a brief counter-trend rally here certainly shouldn't be a surprise, but it is far from certain. Looking at today's Elliott Wave patterns, the bounce from this morning's low has taken the form of a clear (and counter-trend) a-b-c zigzag, strongly suggesting more selling dead ahead. The 1,525-1,550 area looks to offer the first area of support for the down-leg. If this area is penetrated, the odds will increase even further that the Sept 21st low (1,387) will be breached, soon. Please take a moment to give us your thoughts on where you think the Nasdaq is headed. Cast your vote in our new online poll, just up and to the left of this column. Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Special
Update From Grizzly In one fell swoop, the markets gave back in one day nearly all of what they gained last week. Such is the nature of bear markets. The DJIA tanked 276 points (2.9%) to 9,269 and the Nasdaq sank 69 points (3.9%) to 1,699. The "tech heavy" Nasdaq 100 index took it even harder, tumbling 5.5% today. Mainstream Wall Street anal-ysts were quick to dismiss today's sharp losses because of the relatively light trading volume. (Trading on the Big Board totaled just over a billion shares, with 1.66 billion crossing the Nasdaq ticker.) We say, pardon the expression, "bull" to this line of thinking. On the contrary, we think big but orderly moves on "low" volume portent more selling ahead. Bulls should be looking for high volume, panicky trading as a sign that sellers have exhausted their ammo. Other anal-ysts attributed the sell-off to Anthrax-aphobia and Afgan-aphobia. Still others cited simple profit-taking. We say rationalize all you want, the depth of today's sell-off significantly increases the odds that Friday's highs marked a lasting peak. The Elliott Wave patterns are suggesting some support in the Nasdaq around the 1,525-1,550 area. If this area is penetrated, the odds will increase even further that the Sept 21st low (1,387) will be breached. Please take a moment to give us your thoughts on where you think the Nasdaq is headed. Cast your vote in our new online poll, just up and to the left of this column. Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Special Update From Grizzly Short-term, the markets are over-extended, over-bought, and over-due for drop. The Elliott Wave patterns are unusually unclear at this juncture, so we don't have a high-confidence target for the drop. It may just be a pause in this small counter-trend bull leg, or it may lead to a break of the September 21st lows. The picture should clarify considerably early next week. Make no mistake about it though, we firmly believe that the rally from the September 21st has been an admittedly large counter-trend bounce, all within the framework of the ongoing Bear Market. Nasdaq 5,000 will remain unapproachable for many years to come as the Great Bear Market of 2000-200[?] runs its course. The economy continues to show little if any signs of recovery. Indeed, the economy continues to deteriorate, and it's not just the formerly high-flying tech darlings that are slashing their workforces. In the last few days former number one retailer in America Sears announced it will cut 4,900 jobs. Kodak will "shutter" 4,000 workers. Kraft will take 1,000 workers off the cheese and cracker lines. And on and on it goes. Today's Denver Rocky Mountain News, not exactly known for its cutting edge of economic reporting and analysis, finally acknowledged what we have been saying for the last 18 months, with this front page headline:
Have a great weekend! Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Thurs.
10/25/01 9:00 PM EDT |
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Tues.
10/23/01 9:00 PM EDT |
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Mon.
10/22/01 9:00 PM EDT |
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Special Update From Grizzly Here's a quick look at the short-term Elliott Wave chart:
From Wednesday morning's opening high of 1,754, the Nasdaq has traced out a nice five wave decline to Thursday morning's low. An A-B-C three-wave counter-trend bounce developed over Thursday afternoon and Friday. There may be a few more squiggles higher Monday morning to complete wave 5 of C of 2, but the odds are very high that a sharp wave 3 decline will ensue, bringing the Nasdaq down to the 1,520-1,530 area, with much lower potential thereafter. Have a great weekend! Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Thurs.
10/18/01 9:00 PM EDT |
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Special Update From Grizzly The markets gapped higher at today's opening, but it was all downhill from there. Again, renewed fears of bio-terrorism swept across Main Street and Wall Street. From an early 105-point gain, the DJIA sank steadily to close at the low of the day, down 151 points (1.6%) at 9,233. The Nasdaq followed suit, giving back all of its early 30 point gain and closing down 76 points (4.4%) at 1,646. We think the odds are very high that this morning's highs will not be exceeded for at least a week, and probably much longer. Again as we said Monday, "A break below the October 4th high of 1,640 in the Nasdaq should confirm that the next leg to the downside is underway." The Nasdaq is just a handful of points above this level, so a strong rally from here is doubtful. In Elliott Wave terms, the decline from today's early morning peak in the Nasdaq is forming a clear five-wave pattern. A few more squiggles in the chart to the downside on Thursday morning are likely to complete this small structure. This should be followed by a day or two of counter-trend bounce. From there, at least one more sharp leg of decline should ensue, initially bringing the Nasdaq down to the 1,520-1,530 area, with much lower potential thereafter. Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Tues.
10/16/01 9:00 PM EDT |
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Special Update From Grizzly The markets staged a solid recovery throughout the day and managed to close narrowly mixed. The DJIA eeked out a 3 point gain to 9,347 and the Nasdaq slipped 7 points (0.4%) to 1,696. As mentioned last week, the rally from the September 21st lows has relieved much of the extreme oversold technical condition of the markets. We think the rally has just about run out of momentum, though a few more small zigs and zags to the upside are likely. A break below the October 4th high of 1,640 in the Nasdaq should confirm that the next leg to the downside is underway. Make no mistake about it though, we firmly believe that the rally from the September 21st has been an admittedly large counter-trend bounce, all within the framework of the ongoing Bear Market. Nasdaq 5,000 will remain unapproachable for many years to come as the Great Bear Market of 2000-200[?] runs its course. Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Fri.
10/12/01 9:00 PM EDT |
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Special Update From Grizzly The rally from the September 21st lows has relieved much of the extreme oversold technical condition of the markets. Short-term, we can't help but think that most traders won't want to be very long the market going into the weekend in light of today's warnings from the FBI and other federal agencies of the "high probability of additional terrorist attacks in the next few days." Look for a pop higher at Friday's opening, which will quickly evaporate and lead to a sharp pullback. Make no mistake about it though, we firmly believe that this rally is an admittedly large counter-trend bounce, all within the framework of the ongoing Bear Market. Nasdaq 5,000 will remain unapproachable for many years to come as the Great Bear Market of 2000-200[?] runs its course. Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Wed. 10/10/01
9:00 PM EDT |
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Special Update From Grizzly In the corporate arena, the economic weakness that was well underway before September 11 continues to takes its toll on earnings. Today's SSDDDC (Same Story Different Day Different Company) "winners" include Motorola, EMC, and Ford. MOT reported 3rd quarter sales were down 22% from last year's level. Data storage giant EMC expects to report its first quarterly loss in twelve years. Ford is likely to cuts its dividend for the first time in ten years. Last Wednesday we said: "If another leg of decline is to develop soon, we think the Nasdaq must peak by the end of the week, at no higher than the 1,615-1,650 area. Otherwise, the rally will be of a larger degree than we've been expecting, and it will likely carry for several more weeks." The Nasdaq reached at least a short-term peak last Thursday at 1,640 and has been struggling ever since. A break of 1,550 should confirm that the next leg of the decline is underway. The 1,390 - 1.400 area, the September 21st low, is the first target for the decline, with much lower potential from there. Only an unexpected rally beyond 1,640 would negate our short-term bearish outlook. Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Mon. 10/08/01
9:00 PM EDT |
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Special
Update From Grizzly In the corporate arena, SSDDDC (Same Story Different Day Different Company) "winners" Sun Microsystems, Advanced Micro Devices and Gateway Computers dropped bombshells on The Street. Sun warned it will lose 5 to 7 cents a share in its fiscal first quarter, ended Sept. 30. The Street anal-ysts were expecting a loss of 4 cents a share, down from earnings of 15 cents a year earlier. Revenue will come in at about $2.9 billion, 42% below the $5.0 billion posted a year earlier. AMD eclipsed Sun by saying it expects to report a loss of 26 to 31 cents a share for the third quarter, up from The Street consensus of a 12 cent loss. AMD also said third quarter sales would come in at about $766 million, down 22% from second-quarter levels. Gateway said it expects to report a loss ranging between 14 to 17 cents a share for the quarter ended Sept. 30, compared to anal-ysts expectations of a loss of about 4 cents. Despite the gloomy reports, the markets were able to rally off the morning lows. At 10:30 AM EDT the DJIA was down 100+ points and the Nasdaq was off nearly 50. From there, the markets rebounded solidly, apparently inspired by President Bush's new $60+ billion tax cut plan, in addition to the $75 billion "economic stimulus package" previously announced. Translation: The gub'ment is deeply worried about the recession in progress, and they will do "whatever it takes" to prevent it from turning into, umm, here's that dreaded "D" word, a depression. For the day, the DJIA gained 59 points (0.6%) to 9,120 and the Nasdaq gained 8 points (0.5%) to 1,605. On Wednesday we said: " If another leg of decline is to develop soon, we think the Nasdaq must peak by the end of the week, at no higher than the 1,615-1,650 area. Otherwise, the rally will be of a larger degree than we've been expecting, and it will likely carry for several more weeks." The Nasdaq reached at least a short-term peak on Thursday at 1,640. A break of 1,530 should confirm that the next leg of the decline is underway. Make no mistake about it though, we firmly believe that this rally is a large counter-trend bounce within the framework of the ongoing Bear Market. Nasdaq 5,000 will remain unapproachable for many years to come as the Great Bear Market of 2000-200[?] runs its course. Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Thurs. 10/04/01 9:00
PM EDT |
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Special
Update From Grizzly As we've stated many times over the past year and a half, Bear Market rallies tend to be sharp, swift, and usually short-lived. The DJIA surged 173 points (1.9%) to 9,124. The Nasdaq, having lagged the DJIA for the last week, played catch-up and soared 88 points (5.9%) to 1,581. Indeed, it was something of a buying frenzy today, on high volume of 2.6 billion shares traded on the Nasdaq and 1.65 billion on the NYSE. Yesterday we stated: "In Elliott Wave terms the Nasdaq's rebound from the September 21st low of 1,387 is not forming a five-wave impulse pattern, thereby strongly suggesting that another solid leg of decline is ahead. There may be another day or two of zigging and zagging with an upward bias as the corrective pattern runs its course, but we think the Nasdaq should head down toward the 1,225 area, and potentially much lower in the weeks to come." Granted, today's strong rally casts a considerable shadow of doubt on this short-term outlook. If another leg of decline is to develop soon, we think the Nasdaq must peak by the end of the week, at no higher than the 1,615-1,650 area. Otherwise, the rally will be of a larger degree than we've been expecting, and it will likely carry for several more weeks. Make no mistake about it though, we firmly believe that this rally is a large counter-trend bounce within the framework of the ongoing Bear Market. Nasdaq 5,000 will remain unapproachable for many years to come as the Great Bear Market of 2000-200[?] runs its course. Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Special
Update From Grizzly
The Fed cut its target for the federal funds rate by 50 basis points to 2.5 %, the lowest level since 1962. The Fed also cut the more obscure discount rate by 50 bp to 2.0%. The last time the federal funds rate was this low was back in 1962. This photo of Sir Alan is from the Federal Reserve Web site. This may be from 1962, too.
Following the 2:15 PM EDT Fed announcement, the markets sold off and then rallied into the close. The DJIA gained 114 points (1.3%) to 8.950. The Nasdaq advanced 12 points (0.8%) to 1,492. Two SSDDDC (Same Story Different Day Different Company) "winners" stepped forward today. Compaq Computer Corp. said its revenue and earnings will be compacted in the 3rd quarter. Revenue will be about $1 billion less than expected and the company will post a loss of about 6 cents per share, compared to anal-ysts' expectations of a 5 cent profit. After the market close, Nortel Networks said it will cut another 15,000-to-19,000 jobs, on top of 30,000 cuts previously announced. By the time they're done, "No-tel" will have cut its workforce in half. So what lies ahead? In Elliott Wave terms, the Nasdaq's rebound from the September 21st low of 1,387 is not forming a five-wave impulse pattern, thereby strongly suggesting that another solid leg of decline is ahead. There may be another day or two of zigging and zagging with an upward bias as the corrective pattern runs its course, but we think the Nasdaq should head down toward the 1,225 area, and potentially much lower in the weeks to come. October of course is notorious for market crashes. We probably won't see an historic and dramatic crash, but the risk of such an event remains high in light of the precarious geo-political situation. Stay tuned! Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Special
Update From Grizzly
We think a 25 basis point cut will disappoint the markets, possibly generating a swift reaction to the downside. Indeed, the Fed is running out of ammo with which to fight the recession. As we've mentioned many times over the past three years, interest rates have been down around zero in Japan for years, and their economy remains stuck in quicksand. So what lies ahead? October of course is notorious for market crashes. In Elliott Wave terms, the markets are at critical juncture right here, and the picture should clarify soon. Despite Friday's rally, the Nasdaq has held below last Tuesday's high of 1,528. If this level is surpassed early this week, then the door will be open to further advances over the coming weeks as a major counter-trend rally will be underway. Alternatively, if Thursday's low of 1,418 is breached in the next day or two, another solid leg of decline should ensue, carrying the Nasdaq down toward the 1,225 area, and potentially much lower. Stay tuned! Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more. |
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Tues.
09/25/01 9:00 PM EDT |
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Once again, Sir Alan of Greenspan & Co. will take center stage tomorrow.
The Fed will make its unprecedented ninth rate cut in ten months this
year. The only question is will the cut in the federal funds rate be 25
or 50 basis points. If the Fed cuts 50, it will bring the fed funds rate
below 3.0 percent for the first time since 1963.
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