Research in Motion (RIMM) is near its lows as well.

I don’t know if you guys can tell from this first picture but that is $1.99 regular at a Shell gas station here in Austin. Regrettably, the beast only takes premium, which I paid a whole $2.25 a gallon for. Hard to think that in July this same premium was costing me over $4 a gallon. Amazing folks, utterly amazing..

I apologize for the crappy phone pictures.

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Stay safe out in the markets. Sell the rips and buy the dips. Trust me, you will thank me in the future.

-Justin Moon, Senior writer for Marketchasers.com

After looking at a few of these, I started thinking to myself, “Did I move some of my equities too early?” First, lets take a look at the chart for Spyder Select Basic Materials ETF (XLB). Notice the complex head and shoulders formation that was formed earlier this year with the neckline drawn across with the pink line. Most technical analysts say that the biggest drop a share price will have once breaking a head and shoulders pattern is the price at the top of the head to the low where the neckline is draw as far as a dollar value. You take that value and subtract it from the neckline to determine the farthest it will fall. I have labeled another pink line at the bottom of the chart showing this point, so far instance here, the difference between the neck and the high was $12.06, so you subtract that from the neckline value and we achieve a value of $22.42. Notice how awfully close we are to hitting that line. A fib level was broken on Friday but we may see a turnaround Monday. I also wanted to mention to our readers the move this thing has had off of its high right before the selloff took place late last year. Does anyone here enjoy skydiving?

for this chart, notice how obediently the share price stays within the bollinger band and also notice how the lower end of the band has flatlined, while the upper band has shrunk.

After looking at that chart, I took my attention over to the Spyder S&P 500 Index ETF (SPY) which is probably the most heavily traded security on the New York Stock Exchange, trading just above 540 million shares on friday. I took a fibonacci retracement of the all time low and the all time high of the etf and found something very intriguing. First, notice how the Fibonacci retracement value of $86.63 was broken by a PENNY. After seeing this, I rubbed my eyes and looked back to see if this was correct. I do not have the best charting software, so some of you who have alot better software might want to take a much closer look. All I can say is wow. The second thing you need to look at here is the severity of the sell off we are experiencing here. For some of our older readers, bear markets are not fun, especially if you are a long term investor. With this in mind, remember past bear markets which we thought were bad? Take a look at the gap between the 50 and 200 day moving average on the chart at the depths of the 2001 bear market. See how large that gap is? Now compared that with the same two moving averaged we are experiencing now. See how the 50 day moving average just broke the 200 day moving average? You thought the 2001 bear market was bad huh…..This indicated one thing to me and its the speed and unrelenting selling we have been experiencing when the 50 day moving average on a week by week basis JUST broke the 200 day. Lastly, notice the gap down the SPY had a few months ago that still has yet to have been filled. Hum….

Lastly folks, I would like you to take a look at the short term stochastics chart for this graph. Veteran traders know that you always wait for a retest into the overbought or oversold conditions before going long or going short the security as the first break could be deemed a fake. As you can see, the first break of the oversold condition did not really muster up anything. Now we are seeing the security re-enter and exit oversold conditions. Long the indexes maybe? Just a thought……

I will close up by saying one thing. From the looks of the Spyder S&P 500 index ETF, we are either headed alot higher or alot lower. We could be headed alot lower due to the 50 and 200 day moving averages crossing or we could be headed alot higher due to technical support levels. With this in mind folks, do keep in mind that we are in a bear market and on the brink of a depression. For those of you who think the worst is over, I feel sorry for you. For you fools who retain the buy and hold theory and believe you will end up making more money in the longer run by buying in now and looking at your portfolio in a year, I feel bad for you as well. Where we stand as of the close on friday, five years worth of liquid value has been evaporated. For those of you who want another five taken off, all I can say is that it is your money. I hate to be blunt or have that son of a bitch prick attitude,  but I can only lead a horse to water.

Take these short term bullish moves as a time to take profit because you will get burned otherwise. The market can turn on a dime, something you have witnessed to an extreme degree this past week. I have told many, many people that taking a loss, thus cutting your losses is nothing to be ashamed of. Those who listen to me have saved a great deal of money, those who haven’t have gotten burned. You can use the loss as a tax refund when you file capital gains taxes but most importantly you conserve capital. If you know you were going to lose money tomorrow in a certain security yet you held onto it anyway, why don’t you just send me a check instead of throwing your money away. Atleast sending me the money you are willing to lose is going to a better cause and a better place than where you are leading it to.

Cash is your best friend right now folks. Sell the rips, buy the dips. 6000 Dow is coming. I have predicted it for months.

-Justin Moon, Senior writer for Marketchasers.com

Here are a few others to view:

Arcelor Mittal (MT)

Continental Resources (CLR)

Spyder Energy Sector ETf (XLE)

Time to long oil?

American Express (AXP)

Take care.

-Justin Moon, Senior writer for Marketchasers.com