Report comment

GOATMUG,

PNC - as a full time trader, here is what I see. The recent high ($71.71) reached days ago is in fact a top resistance level (as you already know). Using linear regression settings, that top line on a daily view is set at $72.53 as the top range and $49.52 set at the low range. This is going back 1 year. The middle (mean or average) is about $61. Again, this is over a 1 year period. Also, on a 1 year, daily view, PNC recently hit it's 500 day moving average and resistance knocked it back down. PNC is headed towards it's 200 day moving average, which is $64.92. Not far below that is PNC's 1000 day MA at $64.16. Obviously a close beneath either of these two levels on some strength and volume will confirm PNC's downside move. RSI, MACD rolling.

On a shorter 1 hr time frame, PNC has crossed below it's 20 and 50 day MA and sits in the middle of it's linear regression (think bell curve for anyone not knowing what linear regression is - stock price tends to move towards the middle) and standard deviation maximums at $78.83 and $57.65. The break on the 20 and 50, added to the recent trend are down. However be cautious of the potential for a very near term spike to the upside.

SEC short protection is due to come off tomorrow. Considering the deterioration in the markets, it's possible the SEC extends the "naked short covering rule" it made illegal a while back. I would also consider further manipulation to extension of the rule monitoring to more stocks, if not all. As you mentioned, lot's of noise from the manipulators as nothing they do is working as they want it to. Funny how markets tend to fix themselves no matter what.

I've had great success with PNC put positions. It's not always very liquid, so exercise caution in any large amounts of PUTs. I also went out an extra month or so on PNC in placing my PUTs. Currently, I have NO position in PNC, but I have studied it well.

MER thoughts:
I've been watching MER over the last week and each day I've told some others I share trading info with, that something is up at MER and it's not good. As they seem to show us the kitchen sink, I think this time it's a little more believable. Wow, never thought I'd say that. MER as we all know, is in Deep Doo-Doo! This is obvious by Thain's comments. MER is losing credibility fast with investors and Wall St. Not a good thing if you want to survive. This brings me to ....

MER must really be bad off and has made the recent moves to stay afloat. This is just my opinion. They could not raise money through share offerings as that tactic was shown not to work at the time. The sale of Bloomberg, and the consideration of the Blackstone sale stunk of desperation. This recent move has me thinking they still needed more cash and were looking at every possibility to get it. My thought process is this was the only option left and they took what they could get.

Tomorrow will be an interesting day. If MER is cleaning out the toxins, their worst may be starting to get behind them. Starting......... We've all seen the incredible rise after a BS earnings call and more than once for that matter. Chances are, we could see the same here. If the major toxin is out, less to worry about.

MER took a ton of that crap onto their OWN books. At one time, the leader in doing so. MER wrote $28 billion in CDOs in the first half of 2007 alone. MER also took full advantage of leveraging and TRADING their OWN balance sheet with tons of risky, illiquid instruments. The more they knock off the balance sheet, the less trouble their in - as some may view this recent move.

Yes, tomorrow should be interesting. Let's not forget that the Hedgies just had some of their worst months yet for losses. Large unwinding by the Hedgies will (if not already happening) have downward pressure on the market.

The recent move by XL could be more of what's to come by the others. Bullish view by some? Could drive a short term rally?

My own view is this market has MUCH more downside to come. Economic deterioration, tightened lending by banks, jobs being lost, we all know the issues.

I don't tend to recommend people watch bubblevision, but in this case.... tomorrow morning 6 AM EST on CNBS... sorry.. CNBC Steven Hochberg is on. He's been calling the market levels near perfect all year. He writes a forecast 3x per week for Elliot Wave.

Here is something for a little fun thinking...... What if this whole thing was/is orchestrated (but got out of control) to screw China since they hold many of our Dollars? Just a fun though, but interesting to think about it.

kcdallas23
Kip