十二月 09, 2008 - 05:18 下午A Murky, Muddy, MessBy chance I saw someone was asking how often I update my watch lists. The answer is: constantly, and in real-time. You can pretty much count on those lists representing my holdings at any given moment.
As for the market, I find this graph of the T-Bill rate fascinating, since it shows the continued willingness of the investing public to accept 0% returns instead of risking it on just about anything else.
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On the one hand, there have been some really beefy returns on battered issues over the past week or so. I've taken profits here and there, but I've still got many long positions; here is one of them, which is spite of today's drubbing overall, held its own decently well.
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At the same time, many issues have pushed themselves to the point where they are attractive shorts for the umpteenth time. As regular readers know, I bought my first FAZ ever for the first time today, and it wasn't a small position, either. Here's a good example of why I think the financials are heading for some weakness:
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I continued to watch the EUR/USD very closely. This has been surprisingly strong, although it still has not broken out yet.
I continued to watch the EUR/USD very closely. This has been surprisingly strong, although it still has not broken out yet.
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I have done quite well with the ES over the past couple of days. There is a bunch of trading from 895 to 915 that I think is going to act as a barrier to much upside action. I've trimmed my short position to 10 contracts on the ES, and I've tightened up my stop. There aren't any big economic reports until Thursday, but at that point you'll basically have four big days in a row packed with reports.
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Take note of how abruptly the Dow turned yesterday once it reached the 23.6% level (shown here in bold); the bulls are eventually going to push their way higher, but not after getting severely bloodied. It's going to be a really slow, tough, ugly slog higher.
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I've noticed many indices and ETFs are bumping against their 50 day moving averages. EEM is a very heavily-traded example (and notice the doji harami pattern).
I've noticed many indices and ETFs are bumping against their 50 day moving averages. EEM is a very heavily-traded example (and notice the doji harami pattern).
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The $NDX has this same relationship with its moving average, in addition to a decent shooting star.
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As for energy, yesterday's rise seems to have been a one-hit wonder, but it's still really - - dare I use the word? - - cheap. Any sustained push higher on energy's part will do very powerful things for the market in general. It, like the EUR/USD, merits close watching.
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I had been sort of ticked off at the market last month, but it's getting to be fun to trade again. I've got a terrific mix of long and short positions, and things........for the moment...........make sense if you stay on top of the charts. Casual observers of the markets are guaranteed to be confounded for a long time to come.
十二月 09, 2008 - 10:12 上午The FAZFinancials have run up so quickly, I'm entering my first trade ever in FAZ, the triple-inverse financials ETF. This thing is so volatile it has a 100% margin requirement. As an example of the runup in financials I'm talking about, here's BAC:
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Here's the entire intraday minute bar history of FAZ. It's obviously had a very rough run due to the recent strength of the financials, but I feel pretty good about this trade.
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Posted: 10:12 上午 | Comments (View) | Permalink
十一月 22, 2008 - 03:40 下午ConflictedI determine my belief about the stock market's direction mainly from three sources:
[*]My analysis of major index charts;[*]My analysis of individual stock charts which I consider good opportunities in either direction;[*]The opinions of a handful of site which I respect (already listed here)The trouble is, all of these sources are conflicted. Index charts show virtually no support beneath, yet they are astonishingly oversold; I have a mountain of individual stock charts whose own "bear market" has only just begun, and an equal mountain of charts which - - although not classically bullish - - certainly suggest a very strong bounce ahead; and the sites I follow have all manner of opinion, ranging from multiple sequential days of 500 point gains on the Dow to an imminent crash.
So, for the moment, all the easy money seems gone. It's no longer feasible for me to sashay over to a computer and pull a few tens of thousands of bucks out of the market. It's very, very hard to trade right now.
Looking at the SPY over the past few (astonishing) months, it would seem conceivable that there might be a tiny bit more upside Monday morning, but the overhead resistance is very substantial. To put it another way, if any kind of meaningful (that is, greater than 1-day) bounce is going to happen, the SPY must make a decisive and unapologetic push past $83. The action on the SPY from $83 to $100 represents a formidable barrier to upward movement (setting aside the fact that there seems to be no rational reason to buy stock in this market).
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It's the same story with OIH. If we zoom past the $80s, maybe we're finally entering the elusive wave 4; but all recent activity suggests a rise to no higher than $77 or so and then the resumption of the plunge.
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Looking at the SPY in a larger context, as I've pointed out, the rise in the late 1990s was pretty relentless, but that also means there's virtually nothing in the way of price support on the way down.
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My dread fear is really simple; there's nothing conflicted about it: the market rockets higher for a few days, effectively (a) blasting me out of my shorts and puts, their profits having turned into losses and, simultaneously (b) being completely empty-handed of any long positions. My nightmare would be for any meaningful portion of my substantial (but hard-won) gains of 2008 to get nuked. I just won't stand for it. I have thus (yet again) hedged my bearish portfolio with a few large ultra ETFs and some stocks which, in the context of a strong push higher, would zoom up in value. Some of these are items like ANF and AA, which have simply gotten creamed over the past couple of months:
My dread fear is really simple; there's nothing conflicted about it: the market rockets higher for a few days, effectively (a) blasting me out of my shorts and puts, their profits having turned into losses and, simultaneously (b) being completely empty-handed of any long positions. My nightmare would be for any meaningful portion of my substantial (but hard-won) gains of 2008 to get nuked. I just won't stand for it. I have thus (yet again) hedged my bearish portfolio with a few large ultra ETFs and some stocks which, in the context of a strong push higher, would zoom up in value. Some of these are items like ANF and AA, which have simply gotten creamed over the past couple of months:
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And others, like BAC, are at "interesting" technical levels of support:
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Most stocks - - indeed, a very large percentage of those that I follow - look like AES. That is, (a) long-term bearish pattern; (b) short term "churning", suggesting an attempt to base; (c) the potential for a set-up of an incredible short opportunity, if equities in general do push higher.
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I'm not usually a person who pays a lot of attention to sentiment indicators, but those I have seen recently make a strong case for the bullish argument. Just about everyone has assumed the world is about to end. With that kind of mentality, it's easy to understand how the simplest (and, frankly, irrelevant) smidgen of news, such as the candidate of Treasury Secretary, can suddenly make the market blast 500 points higher in the span of an hour. That's not the kind of windstorm I want to be caught in with a 100% bearish portfolio.
Anyway, I can't say to you if I'm feeling really bearish or really bullish. If pressed, I guess I'd say my feeling is we'll get a final plunge in the early part of this week and, at long last, can start to push higher in a big wave 4. I hope it works out that way, because this market is absolutely dying for some kind of consistency, since it has been chewing virtually all traders to pieces lately.
Posted: 03:40 下午 | Comments (View) | Permalink
十一月 20, 2008 - 08:58 上午Tank of AmericaIsn't it amazing that a mere two months ago the Russell 2000 was at its highest point in history? Honestly, can you believe it? September 19th was truly the most glorious day to be a bear, even though it seemed the most terrible. Markets can be quite ironic.
Bank of America (BAC) has lost nearly 80% of its value from its high a little over a year ago. Looking at this chart, I'm sure some folks are tempted.
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Let keep things in perspective, however.
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My view is that, if we're going to have a bounce at some point (will it ever come? ever?), BAC is a decent candidate for a bounce from its next retracement level (Fibonacci, not the 2sweeties kind) at about $10.50. It's not there yet.
Posted: 08:58 上午 | Comments (View) | Permalink
九月 04, 2008 - 07:24 上午The Financials Will Do the RestFinancials have had a huge rebound. I think it's over, and I think their next slide is going to be just what the market needs to resume its collapse. At least I hope so. Here are some charts for you to ponder.
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Posted: 07:24 上午 | Comments (View) | Permalink
八月 29, 2008 - 03:33 下午August, Die She Must........Today was a welcome relief, but it still doesn't get us over the fact that this summer's frenetic up-and-down motion is agonizing for bulls and bears alike. Even if we had a single week of a consistent downturn, I'd nail all my financial goals for the year. As it is now, I have to play offense one day, defense the next, offense the next day, defense the next. Feh!
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The $UTIL, which you all know I'm especially bearish on, is on the right track again. A break beneath 460 would spell doom for this index and usher in the 20% drop on which I am counting.
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I've got a medium-sized position on QQQQ puts; the $NDX is below its retracement line (barely) and below its fan line. Weakness in the $NDX would send it, I am supposing, about 150 points lower.
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Every technician on the planet is eyeing 1265 on the S&P. I've tinted in the key area. I know I've said it ten times already, but I'll say it again: a break beneath this level will make the job of the bears really, really simple. Until then, we remain mired in this dread battle. September, "the month of the bear", will hopefully smile kindly on us.
Every technician on the planet is eyeing 1265 on the S&P. I've tinted in the key area. I know I've said it ten times already, but I'll say it again: a break beneath this level will make the job of the bears really, really simple. Until then, we remain mired in this dread battle. September, "the month of the bear", will hopefully smile kindly on us.
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Oil and gold look nicely poised for a tumble; I'd bank on OIH to fall to 165.
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And this ten year chart of $XAU positions this instrument for about a 20 point fall in the near term.
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One specific gold short I'm fond of is AEM:
One specific gold short I'm fond of is AEM:
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The recovery in financials is starting to peter out, I think. The rally following July 15 was gigantic, but the volume is shriveling up. I repurchased puts on BAC today, and both FNM and FRE had sharp percentage drops today.
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What follows are a variety of charts, some of which you've seen, that I like a lot as short positions.
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We'll close this week out with Art Garfunkel singing "April Come She Will", one of my favorites. This only reminds me that Art should be made a saint.
Posted: 03:33 下午 | Comments (View) | Permalink
八月 25, 2008 - 01:59 下午Then I Woke UpIn this weekend's post, I wrote, "Zooming in to the intraday level, however, you can see how technically perfect all this price action has been. An ascending wedge, a break, and a perfect retracement to the underside. I would be very, very surprised (and disappointed) if we didn't see a down day on Monday."
Well, I was neither surprised nor disappointed. I got the "one-two punch" I was hoping for............a drop across the board in oil, gold, and equities. The notion that these are inversely correlated is, in my opinion, total nonsense, and I am positioned as such. Today's 241 point drop on the Dow was welcome, and the last three days of this week are packed with important economic reports.
Observant readers may notice that my performance figures have dropped from something like 95% to 77%. The reason for this is that we've changed how this is calculated. Last week, a reader pointed out what he felt was a mathematical flaw in the calculation; I agreed, and I asked an engineer to correct it. This has been corrected, but still, the figures shown are not bad! Please keep in mind my caveat about this figure, no matter what it says.
Today I'm simply going to show you my favorite current positions. I've got a total of 109 - - yes, 109! - - positions, every single one of them bearish. But here are my jumping-up-and-down favorite ones.........
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