Stock Market
All comments and Stock Market Ananlysis are made by Guy Brumley. Guy has been trading the Stock Market daily since 1992.
Trading, evaluating stock prices and predictions
Market Commentary 2-23-2009 aftermarket
The DOW suffered a 250-point loss today, closing at 7114. Volume was less than Friday’s, which is not indicative of a blowout bottom.
Because we are at the beginning of a new option month, I am slow to take new positions. ISRG ran to 108 on the open, only to trade weaker throughout the day. It closed at 100.40. The market decline is continuing, so I sold the 100 put on ISRG for $6.40. As the market continued lower, I capped the downside with a buy of the 90 put for $2.50. Both these are March options.
I am long Gold at 95 (gld cq), and will sell another call against this based on a 5 point move in gold.
It looks as if we will see the DOW less than 7000 this week. I ran some earnings estimates for the DOW 30 and got a worst-case scenario of DOW 6000. The sooner we put in a bottom the better. This has been a slow steady sell and not close to reaching the climax volume or the high fear level needed to exhaust the selling. Even if the Government issues a comment to stop the selling, it will likely be short term.
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