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The Bulls Are Back 9/28/20

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At least on Monday morning. 

Let's start with the 30 minute bars, then zoom out. 

The last move up overnight as of 3:30 AM in NY looks tired and toppy. But with a 2-3 day cycle projection of 3335, there's some prospect of a second wind. 



The hourly chart shows multiple resistance lines around 3325. But the 5 day cycle projection is also around 3335. Hourly cycle indicators suggest that there isn't much more upside, but there are no sell signals yet, and they could go into trending mode. 



The beautiful 2 hour bar chart shows yeah, there's room to run to 3345-50 without breaking a slow downtrend. Maybe this whole thing since September 9 is a downward biased consolidation.  



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9 hours ago, itiswhatitis said:

Doc - odd question for you.

is there a homeless population in Croatia?  Now that you have been there, any idea on social services?  How are the mentally ill treated, services?


In short, no. You do not see armies of homeless people in Croatia like you do in US cities. Croatia is a poor country, but they seem to have ways of housing their poorest and most needy, unlike the US. 

I'm not familiar with their social services beyond their health care system, which I have paid to use on occasion. The facilities are right out of the socialist era, not palatial monuments to excess like in the US. But care seems good. Medical professionals are highly trained. They have modern equipment, and at least in Zagreb, there are plenty of medical specialists to treat particular diseases. 

By US standards, medical care is dirt cheap for private payers, and universal. 

Apparently there are programs to assure food and housing security. 


Note also that basic living costs are far lower here than in the US. In most places families can find sustenance housing for around $200 per month or less. That's not as cheap as it sounds, given salaries in Croatia are also low.  Low wage workers make only $500-600 per month according to data I've looked at. The average salary is around $2100 per month.  

What I would call class A 2-3 bedroom apartment would run $1000-$1200. Less desirable, not recently renovated units can be had for much less. A very nice 1 br flat in the best locations run $600-750 USD per month. Where I lived in Philly, something similar would run $2400-3000. And Philly is cheap for big US cities. 

Grocery food costs 20-30% less than in US and household supplies are 50-60% less. Restaurant meals are 20% to 50% less. Public transportation is 50% less. 

Gas is much more expensive than in the US. Most people who live in cities do not have a car.  Most cars are minis or compacts. I have been in Europe for nearly 11 months and I've rented cars 4 times for road trips.  Everything else I do here, I do on foot, or on an occasional tram or bus ride. Croatian cities are so geographically compact, I never needed to use public transit. I take an Uber to airports. That costs $15. 

Prescription drugs are 80% less than in the US. Non prescription drugs, like aspirin, are far more expensive here than going to Costco and getting 500 low dose aspirin for $5. But you're still talking about a tiny fraction of a monthly budget.  I get low does aspirin, 28 tablets for about $2. 20 ibuprofen would run about $5. But those are the exceptions. 

Chain clothing and shoe stores cost about as much as at home. But there are street vendor markets selling nice unlabeled clothing for prices comparable to a Ross or Burlington. 

American retirees on a limited income like social security alone could live decently here in Croatia for about $1200 per month including expat health insurance. You would probably want to continue to pay on your Medicare Part B, in case you ever decide to go back to the US, or want extreme medical treatment or surgery. That will cost you another $150 a month or so.   

If you have $2000-2500 a month in income, you could live in a really nice apartment within a block of a beach somewhere, eat dinner in a restaurant 3-5 times per week, and have a weekend road trip every month.  

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An up day on Monday would confirm that the short term downtrend is broken. This report gives you the key support and resistance levels, and what to expect if they’re broken. I’ve added 8 chart picks, 5 longs and 3 shorts, to take advantage of a move either way.

Technical Trader subscribers, click here to download the report.

Not a subscriber? Try Lee Adler’s Technical Trader risk free for 90 days!  

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I rarely day trade, but Friday I got the bug after a couple nice little trades on the short side earlier in the week, particularly a short of JPM which I covered Wednesday. Came in short GS Friday and covered it mid morning with a small profit. Had a few longs, and added mightily through mid day. I told you about chickening out on long TDOC, which is killing me. No conviction. I'm watching it for a BTFD moment. 

I had 8 trades going into the last hour Friday. I kept trying to short a couple into the rally because I was 100% long and I couldn't tolerate that. But trying to short that was like playing whack a mole. I ended covering each short attempt for small losses. Meanwhile the longs were doing nicely. As the market started to pull back I debated whether to sell it all. I got out of 5 of them, but held 3 because I liked the daily chart patterns so much. 

Over the weekend I made a list of second tier stocks that I would not recommend in the newsletter, where I stick to big caps.  There were 14 longs. Could only come up with 3 shorts. One of those was a China stock that blasted off this morning, so that's off the list.  I'll try to put on small positions in the other two, or one or two of those on my list from last week if this rally sticks until New York opens. 

Whether I add more longs will depend on a decent BTFD setup during the day. Waiting for TDOC. 😁



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