Stock Watch: IBM
July 22, 2008 12:01 AM
In “theory” if the market sells down, as is likely, IBM should reverse above either $119.90 or $116.60. There has never been a rejection of a high on this stock. I long ago mentioned that IBM was “likely” to eventually clear it’s high as it has never rejected a high. This is based on charts. Obviously, if they had warned the stock would be lower. News can and will destroy any chart. But they didn’t.
I am still VERY skeptical of the market here, to say the least. There should be an attempt to hold the line above the Dow low. If you believe the market will hold (I personally do not) then IBM should be long above those numbers. If the Dow low does not hold, then who knows. But IBM should fare better than most others if we do in fact clear the Dow low.
IBM Blows Through $124.50 Late
July 16, 2008 10:48 PM
I had posted in my updates on IBM, that “normally I would say long IBM if $124.50 clears, but wasn’t sure how long the strength could last”. I expected it to “pop” once it cleared as shorts were very likely to cover. The key here was today’s open and low. It opened at $122.81. Therefore, once $124.50 cleared the odds of a new “problem” were very small. Therefore the probability of a big spike today was very high. I could not really comment on what was likely last night as it depended on the open, IMO. If it had opened above $124.50, I would have been FAR more skeptical. But the lower open and THEN clearing it gave the shorts reason for fear and they had to cover.
I commented long ago on IBM that we likely have never seen the high. There has never been a rejection of a high on IBM of any kind, IMO. The market weakness has drug it lower, nothing more. Obviously earnings will dicate the outcome here. Once again, aside from new, weakness should be bought on IBM as long as today’s high does not clear first. If we make any new highs, you have to be careful of a reversal. And, not to mention, chasing new highs is chasing. If you wanted to be long IBM, I have the call to be long it back on 07/02 or 07/03, I forget which, above $116.60.
Charts Do Not Matter: IBM Selling Off Just Under $124.50 Was A Coincidence
July 15, 2008 12:54 AM
Charts do not matter, at all. I just take a wild guess and see what happens. Uhhh not.
IBM needed to clear $124.50 to even consider being long the stock in that area. Today’s high? $124.25. That’s a shock, like not at all. The problem is with IBM is there is a battle between $116.60 and $124.50 right now. This could ultimately break either way, but will likely take earnings to do it - one way or another.
Have i ever mentioned to NOT be the Lone Ranger in the market’s before? Uhh, like 348 times, at least. Why on earth would anyone buy IBM a $124.25 when it has to clear $124.50 to even have a snowball’s chance of being long? I don’t get it. Then again, I did not understand, as i mentioned, why anyone would buy RIMM at $122 when the long position was no longer supported. But they did it - two days in a row in fact. There must be far more Cramer listeners than even I had imagined.
Even if they opened the stock above $124.50 it would have been MUCH more believable if they opened it lower and THEN took it out. That would have been an indication of strength, IMO.
07/15 Update: If you notice, IBM hit EXACTLY $124.50 today. Normally i would say long if it clears. The problem is i believe we would need to hold above that for several days to convince the “moving average” believers that this is real. I cannot say long, even if it clears, but shorting it if it clears would not be wise either, to say the least as shorts may cover.
Two problems here: Moving Averages AND the overall market. I have zero belief on any level we have seen the lows.
07/16 Update: As expected $124.50 cleared after some weakness, and skyrocketed late. I figured this was almost a given. My comments were on whether this can hold. If IBM can stay above $125 for several more days, we may have a better handle on the long lasting strength of this move. I am not a “huge” sma believer, in general, but it is best to know what is going on with them to get more people on board with the move. We have two key points to be long IBM and zero points to be short. Key long prices are $116.60 and $119.90.
Market Recap: My Warning At The Open Was Right On, IBM Also Get’s Hammered As I Warned
July 9, 2008 4:14 PM
I warned not long after the open that the “opening high was sold” and to be careful. I also mentioned that if we were going to get pressure, it would likely come late. Right on target - exactly. The attempt to take out the high failed, and down she goes.
In addition, IBM popped up early, reversed and plunged as I warned last night. I almost put last night that $124.50 area should be a tell. But I was not certain it would reverse there, I just thought it was “likely”. Today’s high was $124.50. I did not have a number, so that was coincidence, but I thought the high “could” come in that area.
Trading: Look For Stocks That Make Firm Highs And Firm Lows
July 9, 2008 2:11 AM
I have mentioned many times that there are certain stocks, VLO for example, that do not seem to make lows or highs that can be counted on. Many big caps can also be counted in that group, like GE. If you do see a firm high or low however, take note. Just do not count on it to happen.
Point being, if you are going to trade, watch the stock or stocks you have interest in and know how they trade. if they do not make firm highs and firm lows that can be traded, look for another, IMO. IBM is a stock that does seem to make firm lows, but is dragged down by the market. But if it makes a firm low, as it did on 07/01, do not discount it. You will likely be wrong.
IBM: More Caution Tomorrow
July 8, 2008 11:19 PM
IBM was one of the 3 “trades” that I said long if you had to be long the market. It has done nicely as if you bought at the open yesterday you made $4 bucks. Not 90210 money, but that’s 3.5% in a tough market - in 2 days. That one trade alone put you ahead of almost all money managers for the YEAR- HA.
Tomorrow there needs to be more caution. If it clears $123.88 it HAS to close positive or there is possible trouble. So the easy money has been made on it, now you better know what you are doing. Leonard the Monkey could have traded it long the last 2 days. Going forward, Leonard could be in a bit of trouble. It will take a bit more brain power to ensure a profit here.
IBM: Pullback Should Be Bought
May 16, 2008 11:50 PM
There was talk last week about people trying to short IBM. The chart says they are wrong. If we do not clear the high first and reverse, it should not clear $120.78 to the downside. Look to be long above that on any weakness.
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