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Chartology: Bear Bounce or Breakout?

Thursday, 12 Mar 2009 | 7:08 PM ET


When it comes to sentiment, there are two instruments that are highly sensitive: Semiconductors and Broker-Dealers. Carter Worth breaks down the art of the chart to determine where the bottom may lie.

Carter Worth, Chief Market Technician at Oppenheimer Asset Mangement also spoke about these intruments on today's Fast Money Final Call.

Here is a summary of Worth's analysis:

The first chart observed was of the S&P 500 , which hit a low in 2002, followed by a substantial rally, which then saw a drop nearing previous lows in the spring of 2003. In the same period, the PHLX Semiconductor Index made the same low in 2002, but did not follow the subsequent new low in 2003.

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  Price   Change %Change
S&P 500
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Worth points out that this same action may be occuring right now, as the SOX has not trended downward to confirm new lows, just as it did in 2002-03.

Second, looking at the two key broker-dealers, Goldman Sachs and Morgan Stanley , the charts display movement that establishes new upward trends. These two names are particularly sensitive to sentiment, which must be differentiated from big banks like JP Morgan and Bank of America , which are not purely broker-dealers like Goldman Sachs or Morgan Stanley.



Worth points out that this same action may be occuring right now, as the SOX has not trended downward to confirm new lows, just as it did in 2002-03.

Second, looking at the two key broker-dealers, Goldman Sachs and Morgan Stanley , the charts display movement that establishes new upward trends. These two names are particularly sensitive to sentiment, which must be differentiated from big banks like JP Morgan and Bank of America , which are not purely broker-dealers like Goldman Sachs or Morgan Stanley.



  Price   Change %Change
GS
---

Worth points out that this same action may be occuring right now, as the SOX has not trended downward to confirm new lows, just as it did in 2002-03.

Second, looking at the two key broker-dealers, Goldman Sachs and Morgan Stanley , the charts display movement that establishes new upward trends. These two names are particularly sensitive to sentiment, which must be differentiated from big banks like JP Morgan and Bank of America , which are not purely broker-dealers like Goldman Sachs or Morgan Stanley.



  Price   Change %Change
MS
---

Worth points out that this same action may be occuring right now, as the SOX has not trended downward to confirm new lows, just as it did in 2002-03.

Second, looking at the two key broker-dealers, Goldman Sachs and Morgan Stanley , the charts display movement that establishes new upward trends. These two names are particularly sensitive to sentiment, which must be differentiated from big banks like JP Morgan and Bank of America , which are not purely broker-dealers like Goldman Sachs or Morgan Stanley.



  Price   Change %Change
S&P 500
---
NOVU
---
GS
---

Worth points out that this same action may be occuring right now, as the SOX has not trended downward to confirm new lows, just as it did in 2002-03.

Second, looking at the two key broker-dealers, Goldman Sachs and Morgan Stanley , the charts display movement that establishes new upward trends. These two names are particularly sensitive to sentiment, which must be differentiated from big banks like JP Morgan and Bank of America , which are not purely broker-dealers like Goldman Sachs or Morgan Stanley.

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Trader disclosure: On Mar. 12th, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (BTU), (C), (GS), (INTC), (MSFT), (NUE); Najarian Owns (COF) Call Spread, (FCX) Call Spread, (GDX), (GS) Call Spread, (GLD) Put Spread, (GE) Calls, (JPM) & (JPM) Calls, (MS) & (MS) Calls, (MSFT), (X) Call Spread, (XHB) Call Spread; Seymour Owns (AAPL), (T), (BAC), (EEM), (FXI); Finerman's Firm Is Short (IJR), Short (IWM), Short (MDY), Short (SPY), Short (USO), Owns (MSFT), (DNA) Calls, (BAC) Preferred, (WFC) Preferred, (WFC) Preferred, Short (BBT), Owns (RIG), Owns (PBR); J. Najarian Owns (MS), (WFC), (COF), (FAS), Is Short (SKF)

  Price   Change %Change
S&P 500
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BAC
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GS
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JPM MLP ETN
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MS
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