SPX 500 *925/*934*/*944/*957 definitely possible, but daily reversal signs appearing and it could be *920 topped
Trading Strategy: sideline (safest); hedge: short (upside stop) [would not be buying equities at that level of maturity]
Kind Regards
Printable View
SPX 500 *925/*934*/*944/*957 definitely possible, but daily reversal signs appearing and it could be *920 topped
Trading Strategy: sideline (safest); hedge: short (upside stop) [would not be buying equities at that level of maturity]
Kind Regards
[QUOTE=belgarion It's looking, to me at least, that the US markets may straightline their way back to 'normal'. QUOTE]
...nice strong retrace towards end of week, but strong price action continued on the last trading day;
...above SPX 500 *897/*901, *944/*957/*967 possible and it looks like, any down correction remains short and shallow to *815 or even stopping at *860, before index will head higher and hit target zone *1000/*1050/*1100;
Trading Strategy: sideline now (safest); hedge: short bias with down stops;
Long Term: REMAIN ACUTELY AWARE OF THE BEAR
Kind Regards
...SPX 500 under pressure...
...short term double top (*930) development a possibility, but only if *889 taken out for confirmation; price action remaining above *889 > SPX 500 *444 (+) most likely;
Trading Strategy: sideline (safest); hedge: short bias and building above *944; short stops respectfully below *889;
Kind Regards
Quote from my post #388 5-05-2009
The DOW broke through an important level today. It has broken through the thick band of resistances 7900 - 8400 to close at 8427. A very bullish sign.
This 7900 - 8400 zone a difficult area to penetrate both up or down....The breakthrough is yet to be confirmed (bull trap?), but when confirmed will serve as a thick floor (support).
There is very little resistance until the major 9000 resistance level. Another important line especially for the TA trendies is the primary downtrend which is now in sight and only 350 points away. The 9000 resistance level is major because it is also the TA target if the DOW broke the 8000 resistance level and a point before a correction could begin. The good news of course is the fact that a major correction would have to tackle that 7900 - 8400 zone again. We can see that zone took a long time to penetrate downwards during the dark days of end of 2008 and it finally succeeded (confirmed) in February 2009.
OK... the DOW had a intraday low of 8366. When I mention the 7900 - 8400 resistance now support zone (made of 3 closely spaced strong support lines at 7844 , 8013, 8350) it is approximate as I have zeroed the figures.
There is also another support line formed since end of March at 7770
The DOW (12 May) respected the top of the support zone at 8366 then bounced up off it to close at 8469 a bullish sign. This old resistance now support Zone has proved to be very strong.
...SPX 500 closing *884, well below April 30th high at *889; double top at *930 now confirmed;
...on a positive note, a correction to *826/*816/*811 most likely, before aiming at medium to longer term target SPX 500 *1000 (+);
...on a careful note, what if it is not a shallow correction and turns out to be a test of the March 09 low, or worse, a continuation of the bear market...???
...by the way, the confirmation point for the Dow double top *8308; Dow closed at *8285
Kind Regards
OK.. I'll bite :)
Where's this DOW's double top??
cheers :)
http://i458.photobucket.com/albums/q...OW13052009.png
...sorry Hoop; should read Dow *8308 confirming 4-month high *8588 (8th.May);
Kind Regards
Hi Ananda77 and Hoop.
Just wanted to say thanks for your insight on this thread fellas.
Much appreciated
I am staying on the sideline abit. This Dow can go both ways.
Add another way Doc....sideways.
I've been mentioning this strong 7900-8400 resistance band for a while now.
The DOW has fallen back within this band again:(. It tried to break out last night (intraday high 8377) but failed to close at 8331 (+44).
The market is skittish atm and the two forces may be fighting either other for a little while ....thus ...that possible sideways trading pattern scenario.
Re: the charts it wouldn't surprise me to see trading range averaging between 7900-8400 with Max High 9000 and Min Low 7500) ....accompanied with heart attack material each time it heads down to test 7900 or (mid7800)...and ultimately if it happened the heart pounding test of the November low (7500)
If the DOW got inundated with immense selling pressure and some how does break down through that very strong 7900-8400 zone all is not lost until...
.... the DOW fell below the November2008 bottom that of the 7500 major support mark....this would upset that bullish inverse head and shoulder pattern that the DOW is presently setting up....
Then again the future usually proves me wrong....so I am ready to jump one way or the other, if my assumption proves to be wrong.
http://i458.photobucket.com/albums/q...ndshoulder.png
...would strongly assume, that SPX 500 key support level *875 would need to be tested (at a minimum) for this rally to go for target without any deeper correction
...top *930 to target *1000 > 70 points; who would want to go in big for this sort of gain in the short term;
...in 2007 at the SPX 500 top, bullish sentiment reached 88% bulls; last Friday, the reading stood at 85% (if 85% of market participants are long, who are the institutions selling to???
...Institutional selling was above its March/May resistance line on Monday and it closed above the shorter term horizontal resistance line yesterday (Wednesday)
...Wednesday, inflowing liquidity moved down sharply
Trading Strategy: sideline (safest); short with upside stop;
Kind Regards
...on a closing basis in the daily/weekly timeframe:
-April 17th High SPX 500 *875.6 was not exceeded until month end April
-1st of May marked the start of another advance exceeding *875.6 at the close
to the May 8th High *930
-*875 > bottomline for any sustained continuation of the current rally
...SPX 500 closed at *883 with intraday low *876.9 (not bad)...but well below last month's high *889
...this should give the index enough strength to test resistance at *915
-successful test of *915 > SPX 500 *944/*967*(+)
-failure in the *915 range (most likely) will result in a substantial downturn, possibly testing March 09 Low SPX 500 *666
-the deciding point for a shallow or deeper correction is a successful/failed test of SPX 500 *816/*826 range
Trading Strategy: sideline (safest); hedge: short term neutral to short bias to *915 with sell stops respectfully below 875.6
!!!LONG TERM, REMAIN ACUTELY AWARE OF THE BEAR!!!
(there is no guarantee and strategies are just ideas)
Kind Regards
Kind Regards
Thanks Ananda77.
I appreciate your reply
...SPX 500 tilted at *915 and closed at *908
Trading Strategy: sideline (safest); hedge: short term neutral to short bias to *915 with sell stops respectfully below 875.6
(there is no guarantee and strategies are just ideas)
Kind Regards
...SPX 500 closed at *903; for the last two days, the volume on the NYSE was quite thin, while the down volume by day end was up today, indicating increasing selling pressure;
...however, unless *875 is taken out decisively, it pays to be careful on the downside;
Kind Regards
Hate to say it, the worm has turned.
US$ in real trouble, DOW to take a hit.
Don't Agree Peitro.
End of uptrend of the US$ is no12 in my list of 23 indicators I used to signal a possible bottoming out of Equities (end of bear)cycle and the beginings of a new Bull cycle. (see #177 10th Feb post in Investing strategies and secular bear markets)
My post in February showed many indicators hadn't signaled back then including the all important never yet failed copper indicator.
However all 23 have signaled now, one of the last being US$ which turned (broke its uptrend) at the end of March 2009.
A fall in the country's currency is part of the economic cycle process..and not necessary a bad thing, it shows the economic cycle is progressing through its recessionary phase towards the next phase (recovery).
Usually a bullish sign for Equities...eg DOW
...SPX 500:
-double top *930 (8th. May)
-peak *920 (20th. May)
-now puffing in an attempt to bounce back to take out 20th May close *903 -unsuccessful so far as the week closed in negative territory-
-more downside most likely however, if by any chance *920 decisively taken out
> SPX 500 *944/*967 (+) for a start
Trading Strategy: side line (safest) hedge: short with upside stop
(there is no guarantee and strategies are just ideas)
Kind Regards
If Phaedrus did a video probably better than this one ''' interesting how a double top can turn into a sad face wth a few quick brush strokes
http://broadcast.ino.com/education/s.../?campaignid=3
This chart has the PE for the S&P skyrocketing of the chart
http://www.chartoftheday.com/20090522.htm?T
....... because earnings have collapsed
http://www.chartoftheday.com/20090515.htm
Thanks for the posts W69. Food for thought on the earnings front...
Another spin on the S&P 500 charting showing 878.94 as a key point. It has be noticed that the S&P500 market has a cyclic wave with an average of 17 weeks between bottoms. We are presently in week 12. It is feeling from the Chartist that if the 878 level is breached it will begin the wave down to a possible Fibonacci 61.8% level of 768? before it starts to wave up again.
http://broadcast.ino.com/education/sp_500_17week_cycle/
From all the posts presented on this thread lately it seems there is a common consensus that this present rally in the US Equity markets may be over.
This period coming up may define whether we are still in a bear market or that we are in a young bull market.
...can not see much evidence of that, but after the double top in the SPX and Dow now and if *875 falls, trading needs to happen on the assumption that yes, the rally may be over and the next down leg may have indeed started, although this scenario is the least likely amongst others. A more likely scenario is that the market is going for a correction on a shallow or deeper level before hitting 'GO' for SPX 500 target *1000 (+).
Long Term: !!!!BE ACUTELY AWARE OF THE BEAR!!!!
Kind Regards
S+P 500
long with pretty tight stop
Give you butterflies trades like that.
Cheers
Miner
US market close last night.
yes I knew that, it was Memorial day. market still traded tho, and in the right direction too. but yeh overall things were very quiet.
haha miner. yes a confluence of harmonic patterns was irresistible to me.
Originally Posted by Hoop http://www.sharetrader.co.nz/images/...s/viewpost.gif
From all the posts presented on this thread lately it seems there is a common consensus that this present rally in the US Equity markets may be over.
Cross out the all and add minority now.;)
stop was at 877.6 so it held through those dark moments. woke up to a nice limit having been taken at 896. lots more there for others to have. notice the new butterfly in this picture sometimes they take off as if they were eagles.
Peat. Just had a vision while reading your post :D:D
I think I should tone down my optimism a tad...you agree?;)
http://i458.photobucket.com/albums/q...eenShot012.jpg
...SPX 500 continued to bounce after staying ahead of *879 last week
- *916 congestion/*925/*930 double top overhead
Trading Strategy: sideline (safest); hedge: short with upside stop
Kind Regards
haha thats awesome Hoop.
I'm certainly feeling optimistic now, tho not that the market will go in one direction or another, more that my harmonic patterns get it right sometimes.
...most likely, the bulls need some more visionary aid to see the index past *916/*925/*930 but in the meantime, *875 seems to go for a walk soon
Trading Strategy: sideline (safest), hedge: short with upside stops and naturally, sell stops somewhere in the desert below *875
FRBSF Economic Letter
2009-16; May 15, 2009
U.S. Household Deleveraging and Future Consumption Growth
http://www.frbsf.org/publications/ec...el2009-16.html
Kind Regards
the last 3/4 hours action sofar looks like a bear flag. after it was oversold. the xlf has tested 11.64 again today. looking to add to shorts at 895 s&p
...starting from May 8th High SPX 500 *930 > declining tops *925*/*914
-*914 > Key Level to any further upside potential; most likely market will fail beneath *814 and consequently drive SPX 500 out of current trading range > if *875 test fails
Trading Strategy: sideline (safest), hedge: short with upside stops and naturally, sell stops somewhere in the desert below *875
Kind Regards
...during the last 5 minutes of trading the SPX 500/the Dow/the Russell 2000 all pushed through their respective Wednesday's (27th) intraday High;
...before getting carried away with bullish sentiment, today's charge needs to be confirmed with a close above SPX 500 *925 (May 20th High), further indicating the continuation of the bear rally towards the SPX 500 target *950/*1000 (+);
Trading Strategy: sideline (safest) till confirmation; hedge: stopped out and now neutral with very tight down side stops to protect equity exposure (I have my reservations about this move)
Transparency????
As for today's market close, with a literally parabolic jump in the last minute of trading, if anyone still thinks this market trades based on anything resembling normal behavior (unless someone had a very Jerome Kerviel-esque fat delta hedging finger or one/two moderate/large quants who had a huge index hedge imploded), I have some BBB+ rated CMBS to sell to you at par. One culprit could be hiding in the huge drop of agency trading, which this week dropped to a several month low of 1.875 billion shares.
(see attachment 1)
So as essentially no institutional or retail clients are trading any more, it is just a few desperate computers trying to front run each other. And, of course, for the biggest beneficiary of this PT principal bonanza, look no further than the chart below.
(see attachment 2)
Going back to today's ridiculous close, the chart below shows it all: the complete tape painting volume spike at the very end of the day speaks for itself. And as computers now simply issue forced stock recall orders to each other, painting the tape wet with manipulative intent and volume spikes into the last 20 minutes of trading every day, their human creators are left on the sidelines, trying to outshout each other as to the reason for why the market keeps rising while the economy keeps tumbling.
(see attachment 3)
Is there ever going to be any transparency in this market again?
Kind Regards
Further to Friday's Close:
Friday's close was "interesting", to put it mildly.
Here's a chart of Friday's price action in the /ES, the S&P 500 "Electronic" Futures:
(see attachment 4)
Notice the huge volume spike (the blue underlay) on the chart at the close.
There were 146,083 contracts traded in that one-minute period between 14:59 and 15:00 (Central); the next minute, when the real dislocation hit, traded 91,774 - after the cash market bell had rung.
The closing bell is usually busy. But this sort of volume is absolutely unheard of. To put it in perspective yesterday the same time recorded 26,540 contracts, and 36,642 the minute after.
Volume was light all day, as is somewhat common in the summer on a Friday. The close started its usual increase, and was up to 23,000 contracts at 14:57 with two minutes remaining.
Then all hell broke loose.
"Paper", or institutional representation, was stalking the close; the pit audio feed so stated. Directly in front of the bell 1,000 contracts were bought - as near as I could tell at the market.
Those are "Big" contracts, each being 5 of the /ES minis; this was, in effect, a 5,000 contract /ES market order.
The reaction was instantaneous. The offer side of the market collapsed and the /ES rocketed higher. In the pit, trades went off as high as 925, but on the E-Mini trades were recorded as high as 927.75. As quickly as it got there, it collapsed back to 922 - a nearly six-handle (3/4 of one percent) straight-up and down spike.
Now here's the problem:
For me to believe this was "organic", that is, this was an un-forced order, I have to believe that someone wanted to go home net long the equivalent of 5,000 /ES contracts into the weekend at a severely disadvantaged price. The market had been calm all day; if you wanted to buy 1,000 spoos (equivalent to 5,000 E-Minis) there was plenty of opportunity to do so all day long. This sort of market order was guaranteed to dislocate the market - so the buyer had to simply not give a damn what sort of price they got.
How bad of a fill was this? To put this in perspective each /ES point is worth $50 per contract.
Each single point that was disadvantaged to the buyer by this execution cost him a cool quarter-million bucks, and on average, the "disadvantage" was likely around five full handles, meaning that the buyer of these contracts, if this was an "organic" order, willingly ate $1.25 million dollars.
I don't believe for one second that is what happened.
There are only two possibilities that I can come up with, and both demand answers:
"Someone" was forcibly liquidated out of a short position - a fairly big one. 1,000 S&P "big" contracts has a maintenance margin requirement of $22,500,000 - that's not a small position, and each point, as noted, has a $250,000 move associated with it. Who was it and why?
"Someone" who didn't give a damn if they lost a sizable amount of money intentionally wanted to shove the cash market up through the 200DMA, a critical technical level. They were 1 minute late; they succeeded in doing so in the futures, but not the cash!
#2 makes for great conspiracy theories, but my money is on scenario #1 - someone got forcibly liquidated into the close, perhaps a big customer, perhaps a hedge fund, but someone.
Whoever it was the coupling between the pit and the Globex futures guaranteed the result. There are computers and traders looking for differences between the pit and E-minis every day who try to pick up those nickels in front of a steamroller. When the offer side collapsed the computers took over and stops got run all the way up to 927.75 before quickly collapsing back down to 922.
Here's the cash chart, as of the close this afternoon:
(see attachment 5)
That's a very pretty potential double-top in the oval, and it coincides with the 200MA.
This is not to say that this level will necessarily hold. We are, in fact, only at the 38.2% retrace from the decline that initiated last fall! It would not be unusual for a bear market rally to go as far as the 61.8% retrace before its over, which is up around 1060ish, or the 50% retrace around 990.
What does this all mean? A few things:
The stops up there are gone. They were potential rocket fuel for next week and the propellant to take us to - and potentially through - the 200DMA on the cash.
A bunch of someones had a lot of contracts that were short taken out on them. Those nearly 250,000 E-mini contracts did change hands, and odds are a very large percentage of them constituted stop-loss orders on contracts sold short from when we were up toward 933 a few weeks ago. Those traders are going to be quite pissed off, but that's the risk of the game.
Next week is very likely to be extraordinarily violent, especially Monday. /ZN (10 year Treasury futures) has seen an insane drop in open interest over the last few weeks. This little game undoubtedly severely damaged open interest in the E-Mini /ES contract.
Thin markets are dangerous markets. While the E-Mini still is very liquid, the removal of these stops from the order book leaves the door open for both little resistance if the market decides to move higher early next week, and also provides the potential for irritated shorts to re-establish their positions short, driving the market lower. Those who wound up long during that little ramp job are likely to be rather nervous as well.
For my part I shorted that spike. Not large, and I am fully prepared to hedge it Sunday evening if necessary or just take it down, as there is every possibility, this close to the 200MA, that we will at least hit it on the cash, and blowing through it on volume and continuing higher cannot be ruled out.
I will note, however, that the last time we saw this sort of dislocation activity start up into the close it it too began with these sorts of "rocket shot" moves higher - and once the shorts were all blown out by having their stops run, the market essentially pancaked.
Look sharp - the sharks are in the water and you taste good.
Disclosure: Mildly short (~5% position) the broad market.
(looks like I am a bit more scottish than this guy but as I said, the downside stops ARE PRETTY TIGHT and thinking about it could ride his short position all the way to Athens....)
Kind Regards
...no point speculating; sure is that according to some analyst opinion, since the Dow is price weighted and GM's price is under 1 US$, the removal of GM would not have a big impact...but whatever the replacement could be, would probably make for a more volatile market.
Kind Regards
The DOW replacement when GM exits is going to be a talking point. It seems a tech company may get the nod. Apple? Google ?
Many have observed that there are no insurance companies now and thin in financials so the DOW seems unbalanced at this moment. Many also point out by saying "who cares" as the DOW is becoming irrelevant as an index.
The current 30 companies that make up the DOW are
Company Symbol /Quote
- Alcoa AA
- American Express AXP
- AT&TT
- Boeing BA
- Caterpillar CAT
- Coca-Cola KO
- Citigroup C
- Disney DIS
- DuPont DD
- Eastman Kodak EK
- Exxon MobilX OM
- General Electric GE
- General Motors GM
- Hewlett-Packard HWP
- Home Depot HD
- Honeywell HON
- IBM IBM
- Intel INTC
- International Paper IP
- Johnson & Johnson JNJ
- McDonald's MCD
- Merck MRK
- Microsoft MSFT
- 3M MMM
- JP Morgan JPM
- Philip Morris MO
- Proctor & Gamble PG
- SBC Communications SBC
- United Tech UTX
- Wal-Mart WMT
Just general information
With this last week I have heard of commentators within various media mentioning uncertainity in the markets and increasing volatility within the markets. I thought I better check on the VIX a good measuring indicator for volatility. I was surprised to find that it is continuing to fall and is still in its downward trend channel.
..just goes to show don't take the media as gospel.. pays to do your own homework. (the vertical line is my reference when I last check VIX)
http://i458.photobucket.com/albums/q...to_08jul09.png
...they were most likely referring to a Sell Signal the VIX flashed twice on May 7th and 20th which states:
the VIX indicates bearish sentiment (sell signal) if:
-VIX closes below 2 std-deviations from its 20-day period moving average and then closes back within it
...anyway, the market was short up to 5 minutes trading last Friday and there is no doubt in my mind that it has been rigged up, like this 'Green Shoot Bear Rally' has been tampered with from the start...
...and as far as GM concerned, it's history but it's death will create severe ripple effects throughout the markets for a long time as one supplier after the other will bite the dust...
!!!!REMAIN ACUTELY AWARE OF THE BEAR!!!!
_no guarantees and strategies are just ideas_
Kind Regards
You'll enjoy watching this:
http://myprops.org/content/EVIDENCE-...nd-transcript/
---
As an aside, I believe that some of the radical fluctuations during the last half an hour of US trading has a lot to do with the heavy trading of double-short and double-long ETFs.
P.
I believe your wish is about to be granted patsy
the next bubble will be precious metals
Thank You Patsy and agree, according to analyst opinion, it could have been an EFT squaring position...
...for SPX 500 after the bullish break-out last Friday and despite overall weak volume on the recent rally, momentum should get the index to *950/*968 (+) before further corrective downside develops
Trading Strategy: hedge: short bias
_no guarantees and strategies are just ideas_
Kind Regards
The 30 companies that will make up the DOW effective from 8 June are:-
Company Symbol /Quote
- Alcoa AA
- American Express AXP
- AT&TT
- Boeing BA
- Caterpillar CAT
- Coca-Cola KO
- Citigroup C out... replaced by Travelers Companies Inc
- Disney DIS
- DuPont DD
- Eastman Kodak EK
- Exxon MobilX OM
- General Electric GE
- General Motors GM out... replaced by Cisco Systems Inc
- Hewlett-Packard HWP
- Home Depot HD
- Honeywell HON
- IBM IBM
- Intel INTC
- International Paper IP
- Johnson & Johnson JNJ
- McDonald's MCD
- Merck MRK
- Microsoft MSFT
- 3M MMM
- JP Morgan JPM
- Philip Morris MO
- Proctor & Gamble PG
- SBC Communications SBC
- United Tech UTX
- Wal-Mart WMT
Source: MarketWatch 1st June 2009
Fed chief's testimony: Economy's worst may be past (marketwatch)
...nice one chief, but sorry, sure not going to join you in LA-LA-LAND
...market may be using good, pump & dump news to test support, SPX 500 *925 before heading to back towards *965 (+)
Trading Strategy: hedge: short bias
Kind Regards
...on Wednesday, SPX 500 *925 test successful and index now most likely to take out *949 (June 2nd. High) to target *965 (+)
Trading Strategy: hedge: short bias (building above *950)
_no guarantees and strategies are just ideas_
Kind Regards
Usually what happens with continual noise happening everyday, ones brain tends to turn off certain channels and become somewhat out of focus on what really could be happening.
To prevent myself from becoming somewhat brainwashed I develop little projects to try and keep everything within an overall perspective.
I often look back at various historical events for help.
My little project today was looking back at history using long term resistance/support lines and to test the DOW's long term memory effect on the present DOW index performance
The 9000 mark on the DOW is well known by chartists as a key level. If the DOW breaks above this 9000 level it signals a return to a primary uptrend.
What is so interesting about this 9000 level (see green line on chart) is the fact it was also the mark which signaled the primary uptrend back in 2003 confirming the end of the last Bear Market cycle in 2002.
...interesting ....eh
Also interesting is the DOWs long term memory as shown with the other major long term resistance/support lines drawn in orange. None of this is uncommon as most charts show trends are affected by long term memory, however as an investor one can see these long term memories can give you valuable advanced warnings to be careful at these times in the future.
http://i458.photobucket.com/albums/q...us03jun94_.png
...SPX 500 in trading range consolidating between June 23rd. low *924 and June 5th. high *952
...as long as price action remains above *924, bullish upside potential to *968/*976 (+) remains
Trading Strategy: hedge: short bias (building above *950)
_no guarantees and strategies are just ideas_
Kind Regards
...it's kind of weird, the 4.6% yield for PD's and CB's over 30 years...however:
...considering the US needs to finance USD 3.25 trillion by September 2009, of which foreign CB's will take a chunk of, at least 1 trillion can be expected to be taken by PD's, which are literally stuffed with cash to their necks thanks to the bail outs...and this is how it could work:
-PD's and banks borrow at 0% and earn 4.6% short-to medium term -not bad in a deflationary environment
-in the long term however with inflation taking hold, to borrow at 0% at the short end of the curve and lend out expensive at the long end of the curve, constitutes good conservative banking business
...the question however arises, who is going to dash into debt right now, when the whole of the USD denominated debt stands roughly at 52 trillion???
...it is most unlikely, as a matter of fact, the Fed is simply powerless to stop the deleveraging of the credit based financial/economic system; therefore, inflation will not be a problem short- to medium term as long as this debt is not purged from the system;
...and why would the Fed want to raise rates in the short- to medium term???
-Deliberately acting detrimental to the PD's and CB's interests???
-Deliberately killing off the ???Green Shoots???
-Deliberately going against their own strategy of buying bonds to keep rates low???
-Deliberately worsening the housing market???
...and the Fed is DEFINITELY not raising rates to SAVE the BOND MARKET as the bond market does not need saving
...The Fed has only done two most important things based on the long term view:
1. hand out enough cash to the PD's and banks to survive the ongoing asset squeeze short- to medium term and long term to be ready to lend
2. change the mark to market back to mark to model to stop asset write downs short- to medium term and long term for 'toxic' assets to become 'de-toxified'
...for this long term view to play out profitably for the Fed , the PD's, and the CB's, it will be essential for the deleveraging cycle to come full circle
Trading Strategy: mostly cash; hedge: short bias (still); (timing of delevaraging cycle) to buy PD's (banks)
_no guarantees and trading strategies are just ideas_
Kind Regards
...SPX 500 closed bang on *924; giving the index a bit of lee way from severing *928, any sustained violation of *924 and the market is looking at a short term down target of SPX 500 *880 (minimum)
...selling pressure was intense
...any short-term close above *935 indicates more bullish potential
Trading Strategy: hedge: short with upside stop;
_no guarantees and trading strategies are just ideas_
Kind Regards
...the initial SPX 500 sell-off to date leaves room for a bounce; *920/*924/*928 provide initial resistance and failure below that level offers a minimum short term target of SPX 500 *880 (15th. May low); however:
...the retrace from SPX 500 low *904 to intraday high *918 to a close *911 could indicate that another move down has already started
Trading Strategy: short with upside cover to *956
_no guarantees and trading strategies are just ideas_
Kind Regards
Are many "long" holders cashing up now?
I saw in the paper this morning that the index's were up about 40% for the year. Could be near the end of a bear bounce. Mind you, if this is coming when...days, weeks or months away yet and opportunity's in the market all the time. Ahh the dilemma. Sold off alot of oilers today (probably regret that one by Monday) but will hold a few goldies. Patience needed now.
I'm thinking like a true optimist:D:D
What happens Jess if this bear bounce turns out to be a short bull correction?
Not only patience is needed. You may also need that mental re-adjustment such as an unexpected quick buy back in strategy (using investment disciplines of course;)). ...
or if your gutfeel is true... Hoop will need a mental re-adjustment such as an unexpected quick sell out:(
Hi Hoop. Yip, happy to be wrong. May even get in and out a bit. Will use charts and tighter stop losses on my favorites. I really don't need any nights of being "in" and worrying about hearing... the Dow plunged again, and again, each morning on the radio. Had a few of those late 2008.
...SPX 500 bouncing up like a lame duck
Trading Strategy: short (upside cover for optimists); upside stop *935; Short Term Target (Minimum) *847
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
I disagree......in REAL terms and possibly nominal as well I think we are staring down the barrel of another leg down in equities.
Have you seen the latest US State Income Tax % drops?
Wall Street has become completely disconnected from Main Street reality.
They're not likely to remain so disconnected forever....one of them's gotta move towards the other I reckon.....and with Main Street showing little sign of life I'm going to go with another leg down.
Dead Cat Bounce.
-
...yes, for example, Deutsche Bank's latest (last night) forcast for US properties: -40% to come, ETC, ETC, ETC
The Retreat of the Shadow Lenders, Why Deflation and not Inflation is the Order of the Day
Ellen Brown
"While contrarians are screaming “hyperinflation!”, the money supply is actually shrinking. This is because most money today comes into existence as bank loans, and lending has shrunk substantially. That means the Fed needs to “monetize” debt just to fill the breach."
read it here>>> http://www.globalresearch.ca/index.p...t=va&aid=14011
...and although we could see a total of 50 to 60% retrace in the markets -after the current correction has run it's course- the most devastating leg down....etc, etc, etc
Kind Regards
A better than 50% chance its uphill from the March 2009 bottom.
My in depth post (took 2.5 hours to write up...Mrs Hoop not happy:mad::mad::mad: waiting for me to finish so we can go to town).
Its posted on the Forex thread but really it should have been posted here
Click here to see it Post #147
[QUOTE=Hoop;261717]A better than 50% chance its uphill from the March 2009 bottom.
QUOTE]
...at this stage I would assume not many people would disagree with that
...very volatile trading during the Double Witching Day in the US and at this stage would not want to be absolutely definite about a particular number on the SPX 500 index
...sure though, the equity rally paid well to *956 (as noted in many posts, the first major target in this bear rally) and cash is King at present in terms of equities, no point involving high risks
...as far as getting some cash back from hedging, at this stage would take a sweeping view:
-give me *956 (+) and I may be back in the market in terms of equities
-give me *916 (-) for a change in hedging from short bias to short
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
...after breaking 17th. July SPX 500 *904 Low decisively, *979 most likely the next logical target
...further out, potential to reach down for April 21st/23rd congestion *827/*835 if *879 fails
...if *827/*835 defended successfully, another advance to Nov 2008 High *1008 (+) possible and likely
Kind Regards
Hi Belg..
yes.. it seems I have been kicked out of some of my stocks today as well. The DOW down -201 to 8339 does not give much confidence short-term and has presented as you say, doom and gloom again.
On the broader outlook of things.
The volatility measured by VIX. Big MEDIA news today it has spiked big time ...HMMM up 11.36% today...OK lets do homework ..below is the VIX chart
The red circle is what the media is all upset about..you can make up your own mind as to the degree of this drama.
Note: The VIX last Wednesday!! spiked higher than today
http://i458.photobucket.com/albums/q...ix19062009.png
Below is a long term DOW chart with orange resistance/support lines. There is one green line which is important as this was the key line showing when the 2000-2003 and this 2008-20?? bear market period technically ends.
Notice how the DOW has a long memory I have drawn this lines going back years. The DOW still reacts to these lines that are years old.
Also notice the 8250ish support line is important now as if this support is breached as many are fearing it will...a drop back to the next support level is 7900 is very possible.
Many months ago I posted that the DOW had a big struggle breaking up through this 7900-8200 zone.(not noticeable on this long term chart). This is now a strong support zone and will require huge selling pressure to breach.
Also notice that the DOW from last mid October 2008 onwards is attempting to form to form a bullish inverse head and shoulder pattern. The good news is that this pattern can stay intact even if the DOW sharply falls to 7500 then rebounds sharply.
A fall below 7500 would be very bearish and would signal another C wave or capitulation event in progress and would identify the April- June 40% rise as an unusual bear market rally and not a bull market beginning.
On a positive side the creation of the right hand side shoulder is still in progress and a break through the green 9000 resistance line (completing the shoulder formation) signals a technical end of the bear market cycle.
http://i458.photobucket.com/albums/q...aa22062009.png
As you say, the VIX has recently had a bigger spike and nobody cared.
If they care now, the point is not the hard data - ie how much it spiked by. The point is the reaction received.
I'm not sure the sunny weather of the last 3 months in the market is about to end, but it is definitely a time for having the umbrella nearby.
Look at it this way ....
VIX at 31 means that punters are expecting the S&P500 to move by 9% in the next 30 days .... UP or down ... just slightly more than the =/- 8% expectations of yesterday
Not that volatile really?
SD...
I'm sure..... and I can just about guarantee you that the last 3 months sunny weather is definitely over (index wise). 40% rises in a share market index in a period of 3 months are very rare events....a golden opportunity.
Have a look at my DOW chart again. This 2008 bear market freefall was absolutely huge by historic comparisons, so a V shape reaction at the bottom should have been expected by all even without foresight... I as well as some others expected it and made a lot of money out of it....
Look at it in a perspective way (refer to my DOW chart)....the 2008 stock market fall was so severe, steep and sudden that even this dead cat bounce bounced 40%.
Notice on my chart that during the middle of cycles the index trades in a much less volatile and more predictable trading ranges for year or more..
A Technical Indicator freebie report on Marketwatch today.
Not good news for the Bulls unfortunately:(, as they see a lot of signals suggesting a downtrend has commenced with the S&P500 NASDAQ DOW.
They use the indicators that we use on this thread...so this makes good reading and comparisons from us thread posters with how the expert chart readers see it at the moment.
Ananda.. some great stuff for you to look at (re: S&P500) reinforcing your good work on this ST thread
I don't really understand all the TA stuff but there's been a lot of talk recently about the Dow being close to a "Golden Cross" - the point at which the 50 day moving average crosses the 200 day MA. Apparently this would be seen as a strong bullish indicator.
I presume that with the recent weakness in the Dow, this hasn't actually happened yet.
Could someone with a firmer grip on the subject comment on this. In particular, would a failed attempt be regarded as a significantly bearish turn in the market or would there still be grounds for expecting possible further attempts at the cross?
:)
Golden cross or junk jewelery...both are treasured by different people.:)
It's a late indicator so it tells you what has been happening.
The media has hyped it up a bit because its perceived to be more reliable on a medium/long term chart in situations that we are presently in.
Is it more reliable in sharp movements ? Refer to chart...The last time we had a similar situation to now was the 1984-87 bull market cycle...the warning cross was crap as it occurred after the 1987 crash and then crossed again (bullish?...nah not in this case) after a 30% gain only to have several crosses again (always late). This time (end 2007) the All Ords fell more slowly so the cross was very accurate.
Not an good indicator to use in isolation.
The vertical (sepia colour) lines on the chart below indicate the crossing over....so you can visually make up your own mind on how good this indicator is and how it could be of good use to you. Personally I don't use it.
I have posted an All Ords chart because the MA50/200 crossed on the 18 June 2009.
http://i458.photobucket.com/albums/q..._to_24June.png
...again, the market is at a critical juncture:
...a SPX 500 close above *917 would be indicative of a short term Low
...an immediate break and Close below *879/*880 would negate any bouncing potential
...a Head & Shoulder Topping Pattern may be developing (see attachment)
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
...SPX 500 closed comfortably above *916/*917 today and the positive tone carries the potential to test *930/*956
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
...as a trading strategy, it may be a good idea to stay out of this fractured market until the intermarket divergence between the Dow and the Nasdaq/SPX 500 are resolved as there is as much bearish as bullish potential at present; the key will be the Dow direction early next week; the Dow *8490 level needs to fall convincingly to resolve the divergence;
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
Hoop - this on the Golden Cross from Hussman
http://www.hussmanfunds.com/wmc/wmc090629.htm
Similarly, we are skeptical about things that cross our desks urging us to forget the economy's debt fundamentals and break into a chorus of Zippidee-Doo-Dah. Last week, for example, I was treated to a report on the so-called “Golden Cross” – the event where the 50-day moving average of the S&P 500 crosses above the 200-day moving average. Next to a carefully compiled set of dates were the purported returns of the S&P 500 over the following 1, 3, and 12 months. As one moves down the report, the analyst either figured that investors would no longer pay attention or forgot how to operate a calculator, so one-year gains of 100%, 200% and more were piled into the average (the figures were about 10 times the true returns). Suffice it to say that the true history of the Golden Cross is bronze at best, with actual 1, 3 and 12 month total returns in the S&P 500 (since 1940) coming in at 1%, 3% and 14% on average. Even those figures, however, benefit from three particular instances where the S&P 500 gained over 40% over the following year – those instances were 1942, 1953, and 1982 – each which began at multiples of just 7-8 times normalized earnings (not the current multiple of nearly double that). Excluding those three instances, the subsequent returns from the Golden Cross are no better than throwing dice.
In short, beware of analysts bearing indicators that all is suddenly well, and check their facts.
...SPX 500 challenging very critical *927 after *917 intraday defended:
-decisive break and Close above *927 > positive environment to challenge *956 (+)
-Failure at this point > imminent retrace to *879 at a minimum likely
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
Here is a link to download a pdf copy of a recent Merrill Lynch research report on S&P500 golden crosses.
Go to http://www.tradersnarrative.com/free-trading-resources/
Select "Reports and Articles"
Then "Golden Cross.pdf"
This report was commissioned by Bank of America/Merryl Lynch and shows that when associated with recessions, the average 12-month return after a Golden Cross is 19.2% vs the 7.1% average 12-month return for the index.
...SPX 500 reversed all of Monday's sell-off, but so far, the *930 break-out barrier still stands
-further advances to *956 likely, above *922/*925 congestion
-if there is a decisive Close below this level, *879/*865 need to be confirmed before any further advances to the *1000 level are possible
Trading Strategy: as before, give me *956 (+) and I start thinking, but even then, it is most unlikely, I would be seriously bothered with this manipulated GS-bull****
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
...and although medium to longer term, The SPX 500 most likely has not topped out yet, short term, in regards to the SPX 500 H&S topping pattern, any new High below the 11th. June Top *956, is a potential H&S peak (see attachment)
...and the VIX, after a low of ~25 (= 2 standard deviations below 20-day MA), now closed back within 2 standard deviations (= short term sell)
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
SPX 500 so far today:
-*922/*925 >gone
-*917 >gone
-*913 >gone
-*900 may go on the Close, >May 15 Low *879 and *865 in range
...if *865 defended > possibility, that the potential *1000/*1008 bottom will be in place
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
Ananda, the S&P looks like it is in a good trading range.
I must learn how to read it so maybe have a trade one day. Never traded the S&P before.
As time slowly grinds on the US market charts from 2000 are looking very much what they looked like from 1965 to 1981 ..... going nowhere over 16 years ... except this time the amplitude (volatility) of the ups and downs are a bit bigger but none the less the same pattern .... and we are not even at the half way point of this secular bear market
so far, SPX 500 *886 marks the low point of the current correction drive
-reluctance to take it lower at this stage >
-markets oversold >
-modest upward bounce to *900 congestion could be expected >
-*879 remains likely target before market would have the potential to head higher to *1000/1008
...as far as the H&S concerned, there are voices questioning the symmetry of the pattern, but in any case, if there is a decisive break below *879 (CONFIRMED), then potential exist to test the March Low
Trading Strategy: sideline
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
The market is pricing in a bad profit result from the companies.
If there is a few good result announcements, then we can see another run.
...like the usual high negative forecasts and then better than expected results...
the SPX 500 tiptoeing to lower Close, no impulsiveness leading the charge lower, as a result I would be bullish in the short to medium term until the index reaches the *1000/*1008 level as a minimum; further limited losses to *865/*868 could be expected short term;
Trading Strategy: sideline (safest); hedge: short bias
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
Support on the S&P looking solid at current levels...
...pressure on the SPX 500 remained ante earnings reports, but volume has been light on down ticks
...as a matter of fact, maybe due to program trading again, a MASSIVE amount of buy volume hit the market -NYSE ticks up to +1466, the highest extreme since the March Low...
Trading Strategy: sideline (safest); hedge: short bias
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
Market should bounce overnight abit. Dont know if it is a dead cat bounce or not.
The consumer numbers coming out of China is very good. Chinese Auto sales up over 48% and auto market now larger than the US. Very impressive.
Given the US automotive industry is just about on life support, is that such a benchmark to achieve?
The Japanese are far far smarter & have adapted to changing consumer demand (as have other Asian countries, ie Korea), time the US looked elsewhere for guidance :rolleyes:
...round 1: SPX 500 *868 successfully defended
...further pressure on *868 expected, but if the level holds, it will be the base for a bullish advance to *100/*1008/1027 medium term towards the end of summer
Trading Strategy: sideline (safest); hedge: short bias
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards