一月 06, 2009 - 06:10 下午Tuesday TallyOK, this post isn't as late as I thought it would be. I got an opportunity to do a post.
One funny thing is that I notice that ProphetCharts finally (after all these years........) has volume on the Dow 30 graph ($INDU). You'd think I would know about this! Oh, well. As you can see, volume continues to be completely tepid, and we're well past any "holiday season" excuse. Trading is dead compared to Q4 2008.
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Most of the indexes are mushing up against their 23.6% retracement levels. Some are almost there; some are a smidge above. It's pretty evident that the bulls would like to take this rally to the next level, while the bears would love to see things roll over. I'd be more confident, of course, if we were at loftier levels........930 on the S&P is hardly nosebleed height. But I'm positioned in many carefully-selected shorts just in case.
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Looking at the SPY, we see a little better volume picture, with the activity getting stronger each consecutive day since December 23rd. I've highlighted in pink a reasonable amount of overhead supply. I think we've all been in more-or-less agreement that 1,050 is about the most ambitious goal the bulls could reach for the S&P, at least for the next few months, and that is the level which would represent the conquering of all that overhead supply.
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One interesting thing is how steady the VIX has been. Around 39 seems to be the new normal for the VIX, whether the day is up or down. The concept of support and resistance seems to apply to the VIX here as well as it would a stock, since all the highs prior to September 2008 were at about that level (for a number of years, anyway).
One interesting thing is how steady the VIX has been. Around 39 seems to be the new normal for the VIX, whether the day is up or down. The concept of support and resistance seems to apply to the VIX here as well as it would a stock, since all the highs prior to September 2008 were at about that level (for a number of years, anyway).
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I've noted how I thought commodities were ready to soften up. Not quite, I guess. But they still look very vulnerable. Look, for example, at the wheat and soybean meal charts below. I realize this isn't the normal venue to look at commodity charts, but in a market like this, having a notion as to what various asset classes are doing is valuable.
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My bullishness on energy was a very good call, but I definitely abandoned my bullishness prematurely (having sold DIG, for example, several days ago). Looking at XLE below, it looks like we're at the upper range of the past several months.
My bullishness on energy was a very good call, but I definitely abandoned my bullishness prematurely (having sold DIG, for example, several days ago). Looking at XLE below, it looks like we're at the upper range of the past several months.
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Now as for gold, which I've been mentioning ad nauseum here lately, it certainly isn't in any hurry to plunge. The chart still looks solidly bearish, but boy this thing is being stubborn!
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As I mentioned earlier today, the utilities were starting to intrigue me again. The Dow Jones US Utilities Index, on which the SDP is based (double-inverse ETF) is stalling at the mid-140s. Clearly if it pushes above this line, I'll exit my new SDP position, but this could turn into something interesting.
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A couple of years ago, my posts would tend to be about me unearthing a chart or two which seemed bearish in a sea of bullishness. These days, there are simply too many charts and too many opportunities, so I'm more index-focused these days. I think I'll close it up here, but I'll see you in the morning.
Posted: 06:10 下午 | 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 11, 2008 - 07:07 上午SPYs Like UsThe market continues to be quite weak, and the handful of surviving longs I had (about a dozen), I just dumped. The SPY looks like it could head to 86 without much trouble.
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Posted: 07:07 上午 | Comments (View) | Permalink
十一月 07, 2008 - 11:48 上午Watch SPY Closely for a Breakout
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Posted: 11:48 上午 | Comments (View) | Permalink
十一月 07, 2008 - 09:39 上午The Bulls' Best HopeI think all of us, bull and bear alike, would love to see a hearty rally in the market. If the SPY, shown below, can get clearly above 100, I think a 16% gain in a pretty short amount of time is in order (horizontal tint shown). Right now the challenge is not to fall away from the lower oval I've circled, where it's trying to make a little bit of a right shoulder (the start of one).
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Posted: 09:39 上午 | Comments (View) | Permalink
十一月 05, 2008 - 04:53 下午Short-Term SPY and QQQQThis'll be quick. The SPY is presently (after hours) trading at the oval drawn below. There are a couple of "thickets" of support, drawn as large rectangles here. I think that, short term, the SPY could trade as low as the thick green line I've drawn. I intend to hold on to my SDS until about then.
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As for QQQQ, my view is more optimistic (that is, pessimistic); there's really only one "thicket" of support, and it should get down into that level without much trouble. At the moment, we are trading at the oval shown.
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As for what follows the above...........ya got me! But every one of my individual stocks are carefully selected and have precisely-placed stops. Good night!
Posted: 04:53 下午 | Comments (View) | Permalink
十一月 03, 2008 - 05:47 下午Novus Ordo SeclorumThe next 48 hours are going to be terribly revealing - - it will be fascinating to see how the markets react to the election results. I imagine any big move will peter out by the middle of Thursday. If we get a sharp rally, I will take that as an opportunity to (a) sell off some of my more profitable longs (b) get into more short positions. As you can see from my watch lists, I have a bevy on both sides of the aisle. In just one of my accounts, I have 70 longs and 57 shorts! It's quite a mix. And even though 53.68 seems high on the VIX, we've come down over 40% from the peak. A big upward surge in equities could push the VIX down to under 40, which I'd take as an even better opportunity to short.
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I remain long FXP and FXP calls. Some people have complained about losing money on this. What, do you want to catch it at the exact right second? I don't mind some froth. I feel good about the possibilities of this short.
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The big ETFs are all mashed against their 23.6% retracement levels. An election surge would easily kick these up to the next level higher, but I'm already entering some put positions just in case we fall.
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The ES e-mini has been boxed into an 825-1000 range for a couple of weeks now. The "exciting" part of this phase of the bear market ended October 10th. We've just been farting around ever since.
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To quote Trading Goddess - - look at the volume! Or lack thereof. Today was the lamest volume since August, and that's saying something.
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Here's yet another view of a major index. Each 1,000 will hold as resistance, or we'll take a final fly up to about 1070.
Here's yet another view of a major index. Each 1,000 will hold as resistance, or we'll take a final fly up to about 1070.
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My Dow Jones utility short (via SDP) is a favorite of mine. Even if we surge up to 415, I'm hanging on.
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I did after all wind up buying puts on the OIH. I'm somewhat conflicted about this, because crude oil could make a major push higher. I've got a relatively tight stop on these puts at 102.92, which was October 21st's high.
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Finally, just in case you missed my little video creation from Halloween night............it's worth your time:
(View) | Permalink
十月 28, 2008 - 05:00 下午So Now What?At the end of any fantastic day (such as today), I always realize that I never expected it to turn out this way. Although I may be positioned properly, I never really see days like this coming. It's always a terrific feeling to be on the right side of the market, though. Would that more days felt like this!
But what's next? In a way, a day like today is easy. Once the market breaks in a given direction, the money just pours in. But how far will it go? Will this just be another one-hit wonder? Wednesday is a huge, huge day, after all, with both the GDP and the FOMC before us. What do we do? Aieeeeeeeeeee!!!!!!!!
Well, we do what we always do. We calm our minds, center ourselves, and look at charts. So here we go.
Let's start with the dollar. You all know I'm very bearish on the US Dollar right now. Here we have the AUD/USD, which looks poised to take a run at .73 or thereabouts. Good.
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I've got wheat-on-the-brain these days. I think this is an important graph to follow. Getting back up to 650 should be a cakewalk, as it were.
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And let's bury the triangle once and for all, shall we? It's dead. The pattern has been rendered moot. Begone, three-sided menace!
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The real question, of course, is how far are equities going to go? My answer: it depends. More specifically, it depends on the index. Some indexes might have weeks or even months of bullish life left in them. Others might be within a day or two of shorting! Let's look at a few. The DIA could hit serious resistance at about 101.
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In turn, the Dow itself has some pretty serious overhead resistance at 10,100-10250 (allow me to take this moment to back away from my "multi-month rally" comments; it all depends on how fast things move; if we had another day like today, it would be time to short indexes again!)
In turn, the Dow itself has some pretty serious overhead resistance at 10,100-10250 (allow me to take this moment to back away from my "multi-month rally" comments; it all depends on how fast things move; if we had another day like today, it would be time to short indexes again!)
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Take note of the retracements I've highlighted on the $TRAN. We bounced off the lower one today, and I'd say we've got an easy ride to the upper one, at around 4,150.
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It sounds crazy, but I'm especially bullish on the financials. Just look at that tweezer bottom. In fact, I had an interesting screw-up today; I meant to buy $11,000 of MBI; I accidentally bought 11,000 shares instead. Whoops. I hope we don't get any suprirsing news before I get a chance to "right-size" that position tomorrow.
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The $UTIL isn't terribly far away from being shortable again. I'd get interested around 415. If it blew past it, I'd get super interested at 460.
The $UTIL isn't terribly far away from being shortable again. I'd get interested around 415. If it blew past it, I'd get super interested at 460.
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The EFA is one of those items which could have months of fighting higher before it ultimately exhausts itself.
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Looking at tech stocks, they could either (a) go up a lot; or (b) go up really a lot; it depends on which resistance level stops them.
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A different view into this same notion is afforded by the $COMPQ. As I sit here, I'd use 2,000 as a "get-out" point.
A different view into this same notion is afforded by the $COMPQ. As I sit here, I'd use 2,000 as a "get-out" point.
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Ah, and OIH, our dear nemesis - - our friend and foe. Since this finally seems to have shaped up, we could get to $110 without much effort -- maybe even a skosh higher.
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And, more broadly, I'd say the commodities market are looking really exciting for short-term upside.
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Just to hit on my financialy bullishness again, here's the KBW Bank Sector Index which I think could push into a hearty, sustained rally.
Just to hit on my financialy bullishness again, here's the KBW Bank Sector Index which I think could push into a hearty, sustained rally.
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Let's take one last look at a major ETF - this time the SPY. The RSI and Bollingers are good and solid here; we could see the SPY at 110 without much difficulty at all - - if people get especially excited, 120 isn't going to be a problem.
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I'll close by saying this..........I have a bulging treasure chest of symbols that will be incredibly, amazing, delicious shorts when the price is right. Some may take months to "ferment"; others, weeks; a few, maybe even days. I was short COH earlier today, and I covered it at a great profit; it blew over 20% higher, so thank goodness for nimbleness. But the fact is that if this sucker gets back to about $23, it will be delicious to short. That kind of price isn't far away.
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So.........thank you all for being here.......a big part of my success comes from listening to the wiser folks who frequent the board (or, like molecool, have their own superb blogs). I thank you. My family thanks you. And my bulging accounts thank you. Good night! And take pity on those who were caught short..........
十月 13, 2008 - 10:10 上午Overhead SupplyAs much as I appreciate the nearly 600 point pop on the Dow this morning (my SSO and QLD were especially grateful), I think we're at a juncture.
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I have gone ahead and entered a QQQQ put position. Also, as I'm starting to go through charts, I'm actually seeing some interesting charts. I'll post some before the close.
Posted: 10:10 上午 | Comments (View) | Permalink
十月 09, 2008 - 08:28 上午No Man's LandFor any of you who thought every single trading day of my life was flawless and superb, let me say, today has stunk so far. I lost a fair chunk of cash on a long SSO position. I got into my index puts way too late. And I've gotten knocked out of about a dozen long positions. Yuck!
Bear though I am, even I am amazed how we keep going lower. Even some of the most bearish of the bearish folks that I read have been in agreement that we're at/near a bottom, but it seems that a floor simply cannot be found.
Looking at the SPY with Fibonacci extensions below, you can see we're in a bit of a no man's land.
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If we get a real washout, there's still a long way to go. A different view, this time with the $SPX directly, suggests a bounce at about 941.43.
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Posted: 08:28 上午 | Comments (View) | Permalink
九月 26, 2008 - 10:10 上午The GOP Digs InIt's amazing to watch the SPY go flying up and down based on every little word the politicians are uttering today. We are in that most uncomfortable of places..........the no man's land between the upper and lower extremes. I've trimmed my SPY puts by about 2/3rds and my OIH puts by only about 10%. Otherwise, I'm holding strong. You can refer to my watch lists on the right at any time to see all my positions.
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Posted: 10:10 上午 | Comments (View) | Permalink
九月 26, 2008 - 08:16 上午Clean Gap FillThis is beautiful on the SPY.
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The big question, of course, is whether to hold over the weekend. Because on Monday, it's either Deal or No Deal, with the implications thereof. I'm inclined to stick with my SPY position until a possible wipeout on the SPY.
Posted: 08:16 上午 | Comments (View) | Permalink
九月 24, 2008 - 12:44 下午The Bottomless PitThe attempts by buyers to establish a short-term base have failed. I got out of my QLD and SSO positions (the former at a small profit, the latter at a small loss) and at once again 100% in a bearish position.
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Posted: 12:44 下午 | Comments (View) | Permalink
九月 18, 2008 - 12:05 下午A Gain, Finally?The SPY has been struggling mightily, but it's finally (with 55 minutes left in the day; I always have to qualify these statements!) getting some strength. It's index expiration day, and all eyes have been on GS, MS, and the rest of the financial sector. I'm looking forward to doing a long post this evening. I just wanted to pop my head into the blog and provide a really quick update and comment-cleaner.
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Posted: 12:05 下午 | Comments (View) | Permalink
九月 16, 2008 - 04:32 下午A Chartist First; A Bear, SecondWhat's it going to be like when the markets move up or down just a little each day? What are we going to do when the biggest financial event in a quarter is a company bumping up its dividend a little? What will it feel like when a 100 point move on the Dow is pretty big news? We have gone through the looking glass, folks, and entered a totally new world. Someday it will get back to normal.
The reason for the title of tonight's post is that some people were actually ticked off (or "fading" me) since I had "turned bull." (To be clear, I was going long calls on specific sectors). I received a few emails from people, as if I had turned my back on "the cause." I am not here as a representative of the Financial Al Qaida; I don't pray for the destruction of the United States and its assets. I simply want to objectively take advantage of the insights I gain from charts. I may seem like a raving bear sometimes based on the juxtaposition between (a) what I see and (b) what the talking heads are saying; but reality and the charts have gotten a lot closer together lately, so I'm a pretty mellow fellow.
Suffice it to say that it is my life's goal to shake my permabear tendencies and be as dispassionate as possible. My "bullish calls" today are a symptom of my attempt at personal transformation.
The volume on AIG - - just one stock - - was nearly 1.2 billion shares today. It had a multi-hundred percent intraday range. And tonight, after hours, it is getting slammed yet again. I imagine this will be the big story on Wednesday, one way or another.
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Now, a lot of folks have been needling me about a "pledge" to do just one post a day; you misunderstand - - I meant the final three days of this week. I'm going to be very tied up with "normal" work. What I wouldn't give to have three quiet days on the market! But that's not going to happen. What I'll probably do is just write a one-sentence post so that people don't lose their minds posting comments; in other words, I don't want people to have to load 15 charts every time they post a comment; and, at the end of the day, I'll do a regular post (OK, I guess that's two per day).
Looking back, I think I'd give myself a solid "B+" for my performance today. I dumped a huge number of puts early in the day, most of them at very good prices (although I painfully noticed that CEG, on which I owned puts a few days ago, was plunging like crazy!) I was kind of ham-handed with a few positions, notably RUT and OIH. But on the whole it was a good, profitable day, and I can't fault myself too much given the insanity of (a) the general craziness we're going through (b) Fed day, which is always nuts. The $VIX, not surprisingly, poked into "maybe this is the bottom for now" territory, as you can see below. This is only the 4th such instance pushing above 33 in at least the past five years.
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As for what's next, it's tough to say; as of now (just a few hours after the Tuesday close), the GLOBEX is down mildly hard. As you can see from the DIA below, we bottomed nicely at mid-July levels and covered the entire Fibonacci range today, closing near the highs on huge volume.
As for what's next, it's tough to say; as of now (just a few hours after the Tuesday close), the GLOBEX is down mildly hard. As you can see from the DIA below, we bottomed nicely at mid-July levels and covered the entire Fibonacci range today, closing near the highs on huge volume.
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The SPY, also sporting gigantic volume, opened down very hard and created a sizable bullish engulfing pattern (although let's remember last week's similar pattern didn't mean squat).
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And then there's the IWM. It's pretty easy to see in all three of these ETFs how, even if they open stronger tomorrow, they might bump their heads pretty hard at the respecting overhanging Fib levels.
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I should note for the record that I have no index options at all right now. I did buy some NDX calls, and I closed those for a few thousand bucks profit (I couldn't stomach the idea of a big call position overnight). I did go long a wide variety of issues, almost all energy- or gold-based, as I described in the prior post.
Looking at the S&P 500 daily chart, it's pretty easy to make a case for today's low being the intermediate low for a while. Just look at January (and, later, March) of this year; it hit that Fib level and spent months climbing higher. I think the culture, if you will, of the market has changed enough to shorten the countertrend. But I have trouble picturing the S&P just slipping right past 1170 and heading down to the next level of 1075. If we did "crash", however, that's where I'd say it was going to fall.
Looking at the S&P 500 daily chart, it's pretty easy to make a case for today's low being the intermediate low for a while. Just look at January (and, later, March) of this year; it hit that Fib level and spent months climbing higher. I think the culture, if you will, of the market has changed enough to shorten the countertrend. But I have trouble picturing the S&P just slipping right past 1170 and heading down to the next level of 1075. If we did "crash", however, that's where I'd say it was going to fall.
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Another reason for my slight case of bullishness is the NASDAQ and, more specifically, the $MSH. The pattern below is hardly a marvelous long-term hold, but it certainly looks like a decent bounce point; failing Tuesday's lows, however, would really crush this market. The new "oh sh*t!" point in many cases are the lows from Tuesday morning.
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Here we see crude oil (on a continuous basis) spanning back ten years. You can see how it "overshot" its trend very significantly. Likewise, it has "undershot" the trend here. I think that long-term crude oil is going to be bearish, but in the short-term I think it could make a push back to the very low triple digits.
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I will close by saying this - - I'm tired! This "bear market" stuff is really exhausting. The thing which stinks about the slope of hope (not the blog, but the market) is how it requires such riveted attention. I could have lost a ton of money today if I simply ignored the market. The "wall of worry" (a climbing market) is great because it's plodding, deliberate, and non-volatile. So that's probably the main reason I would love to see us enter a bounce for a little bit; I could really use a break from all this! Something tells me the market doesn't care a whole lot about how rested I feel, though. We need to take it as it comes.....
Posted: 04:32 下午 | Comments (View) | Permalink