PART 1 – Options and Stock Market Technical Chart Analysis for October 16, 2009 by Idan Koren

Today we looked at many charts all around and have tried to make sense of the market action. While we got the strong pull back we expected early on in the day, the market did reverse and move higher making the daily S&P candle not so bearish. We still want a confirmation lower and a break of a trend line before we can get more bearish but the setup in other stocks excluding energy is to the downside. With the XLF showing huge down volume in the last 20 minutes it seems like we could see an H&S forming. Other tech look weak including BIDU, AAPL and AMZN (less weak). Financials including GS, and JPM sold off away from their highs and could be showing signs of a reversal or at least a prolonged consolidation. BAC is a very weak stock after it missed it’s earnings, with that in mind it might be worth shorting BAC and Citigroup ( C ) and going long the XLF as a hedge. I also expect WYNN to potentially hit lower lows.. but keep a stop at a descending resistance trendline, I have already gotten stopped out and i’m out of this position.