Morning Audibles 3.17.10 - Happy St. Patricks Day!

Call me dumb, call me idiotic. It took me this long to figure it out. 13 green candles in a row on the SPY. Never been done before in the history of mankind. What's the meaning of it this time? Why now? 

Nothing has changed. Not even for this guy:


We're still fighting wars, unemployment is still way up. Deficits are increasing, entitlements programs, which are only "promises" in the first place, are being bloated to the point of insolvency. The world is still warming (I guess - rolls eyes... Hmm maybe it's "overheating" because of all that free money). The only thing that works, (until it doesn't), are bankers bonuses. The banks that are PAYING those bonuses are insolvent and getting money from the taxpayers to make more bad bets and further enrich themselves.

But then it hit me... This has just been an early St. Patricks Day celebration. We're good at celebrating things in this country (something, I think, we learned from the Romans - before the Irish). I mean, assuming you get through tonight's celebrations, hopefully you'll have enough energy to wake up tomorrow for March Madness (which extends all the way through "this" Tournament, (where they give out a, yup, you guessed it, "green jacket" for a prize - and all the flora & fauna that comes with it, wink, wink!)...

So, at least for a day, if you're a bear, don't worry if your portfolio is doing one of these numbers:


Or even if you're a bull, that's fine too, just keep distracting yourself:

I'm sure it will all work out in the end because those "Chicago politicians" (now transplanted in Washington), sure know how to do things right!
Wait, you're doing it WRONG again!

This is how I'd do it! (But what do I know? I'm just a lowly blog journalist - I might as well just be the Unabomber for crying out loud.)


255 comments:

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2small2bail said...

"and all the flora & fauna that comes with it"

Nice - even 2 of 3 Sleeping Beauty fairies make it into an audible! Anyone know the name of the third? (disclosure: daughter under 5 @ home)

CV said...

@2small2bail

That's "ironic" that you should invoke DISNEY...

My "original" post was going to involve "Snow White" & the 7 dwarves...

"Whistle (by the graveyard) while you work"...

There, I just buried one of my leads for a future date...

call me ahab said...

"Yes we're going to have another recession, I guarantee you. Certainly by 2012 say, it's time for another recession . . .Next time it's going to be worse because we've shot all our bullets."- Jim Rogers

interesting timeline-

can the markets continue for another year or two- on the uptrend?

it's happened before- well beyond many folks's wildest expectations

AmenRa said...

The first five 1-min candles were higher on the SPX. Uh oh...

CV said...

I saw that... Grrr.

AmenRa said...

With all this talk about Lehman where has Erin Callan gone? My guess would be the Cayman Islands.

I-Man said...

Today matters not to me. I've checked out until tomorrow's close when I'll print off the weeklys.

CV said...

VIX in the 16's?

72bat said...

if you don't mind, what do any of you master chartists have as the next level(s) of resistance from here (above 1164.57)?

CV said...

@72bat

probably around 1172...(by my calculations)

I-Man said...

At a glance of yesterday's monthly SPX chart, I would have to say somewhere in the 1180-90 range.

I realize thats a broad stroke of the brush...

Ra was mentioning 1172 I think as a 3LB spot.

Anonymous said...

"If you don't mind, what do any of you master chartists have as the next level(s) of resistance from here (above 1164.57)?"

Resistance is futile. -AT

AmenRa said...

CV

This is the lowest VIX reading since May 08. Fugg it.

CV said...

actually

I'll "x2" the (9:58)...

I-Man said...

Yeah, FUG IT... Lets push it to VIX 9.

72bat said...

much grass

McFearless said...

I'm long Green Beer.

Nice post C.

So, as a bear this is a bit annoying, but how cool was yesterday anyway! On the same day we hit the A=C target (I know we closed just above...but) we had two nice fibo amount of days from the October highs and the March lows and also it was the day after New Moon.

That's a nice picture, even if it wasn't the the trend I was looking for it's very cool to see it.

The comment that this might "last longer than anyone expects" on the bullish side is now mainstream. Certainly it can, but the more people that say it the less likely it becomes. I have not given up on the idea of a P3, and I believe more every day virtually everyone will miss that trade. That said, lets wait until we can't count a solid 5 down before going crazy.

Last, as bullish as the last few days have looked, I would imagine it concerns more than just me that a guy like Richard Russell is still worried...and talking about a vicious bear market....as in one that is coming and one that will take several generations (if ever) to get back to wherever we top out this time.

CV said...

If this is was the HFT open, and the algos have it all afternoon, I can't wait to see what the last hour "push" is going to look like...

McFearless said...

Does the market even have resistance anymore, lol.

karen said...

Good morning! I managed to get up and not spill the beans.. hilarious post, CV..

AR, can't believe you didn't know !! Erin Callan Is Living the Dream

McFearless said...

I know I'm in the minority on this one (Fed Control, HFT control, etc) but we do have to assume that the Fed and these algo's are propping up ALL of the global markets correct?

I would imagine if that is thought through it pokes a big fat hole in this theory but I'm open to hearing why that's not the case.

CV said...

@karen

Is she chopping wood... or wearing a barrel? :-)

I-Man said...

Resistance is just a fun way to torment shortsellers.

And Ben, you know I agree with your 10:04... that part hasnt changed for me at all.

Its just where it starts from that we need to determine.

Yesterday, it just became apparent to me that it wasnt starting from 1150.

CV said...

@ben

You know I'm not a believer of "control" over these things by the FED or anyone else in the grand scheme of things...

But algos do handle the lions share of trading during the longest portion of the day... It's impossible NOT to see in the ticks...

With such LOW volume, it's fairly easy to see that if they're set to the "buy side", then the market continues to get called up in a grinding way...

Until it doesn't...

It'll end badly, in the end, for longs, but in the process, it's annoying to see these price movements on low volume...

McFearless said...

I-man,

Yes, I could have done much better job of sitting on my hands this year for sure, lesson learned, but that was my fault, I'm not going to do the bitch-out I keep reading on the boards blaming someone else for my shitty trade(s).

McFearless said...

On another note, games tomorrow, and they are saying 72 here on Saturday.

Sweet. Felt like a very long, cold, dark winter.

I-Man said...

I dont think they have control, I think they have influence.

Its the collective "us" that have control, and if we play the game, then we cater to their influence.

This isnt about the Fed manipulating, its about the energy that is created when they act.

People follow that energy with hopes to make more money, so its really just "them" using "us" to execute influence.

At least thats where the convo is going in I and I domepiece.

CV said...

I was actually thinking that this morning...

You know, I'll bet most "longs" right now think they have it made... Just keep moving your STOP LOSS up right?

I doubt it'll work so easily in the end...

They'll either have a STOP LIMIT, set or a STOP set to MARKET SELL...

If huge overnight downdraft occurs, the MARKET SELL may be WAY under what they'd envisioned...

Or, if it's a LIMIT, it may blow so far by the LIMIT price that the order never gets filled... They'll wait for it to come back to that price, but it doesn't... Eventually, they'll change it to a MARKET SELL (way lower)...

Everybody is going to lose here... Except the patient bears...

McFearless said...

If the DOW can close with some authority above 10,725 I'm going long for a short term trade.

That's a Dow Theory buy signal, but so far, no dice, we just broke it but that was weak.

McFearless said...

I-man/C,

Yeah I agree with all that, it's all herding. I reminded myself about this on the way to work this morning, I ran into a bunch of construction on I-95, and they had the cement barrier where the road split off two ways going the same direction, I just FOLLOWED where most of the cars were going, if I had went the other route I would have made it to the office about 25 minutes faster, but instead I went were everyone else was going, and it ended up taking forever.

Just like when you say to a cop after getting pulled over for herding, er, I mean speeding.

"But I was just keeping up with the flow of traffic"

Anonymous said...

Macro Man is a good read. Bear. Sold his S&P exposure yesterday. Recommends reading Martin Wolf at Ft.com.

I-Man said...

I only use market orders, but thats just me.

Buy writes would probably be a very savvy strategy in this 3rd leg higher, if thats what this is.

I also think this is a momentum thing... if this wave(P2) really climaxes with one of those parabolic moves, then I think one has to be along for the ride in things like GLD, JJC, KOL, SLX, UPRO, high beta tech names, etc.

Being in the right momentum things will help insulate the risk management, because you're right CV, when the hot air comes out, it will come out fast, and right out of what has been working the best.

McFearless said...

@AT,

If you catch this, I had a question for you on the dollar count, where do you struggle with labeling that a larger C down on this last move? Is it the five of C you don't like? Just curious, it's a follow up to your comment at Dan's site about a possible E wave within the triangle instead.

Thanks man.

McFearless said...

That is a pretty cool pic of Obama, but The Dude he is not.

karen said...

Oh, I've clearly lost my mind.. i was reading 7:00 as 6:00 this morning..

McFearless said...

"Buy writes would probably be a very savvy strategy in this 3rd leg higher, if thats what this is."

that's what MEH has been doing I think, or was doing, and I think he was cleaning up doing it too. MO as I recall.

Nic said...

Crowded trades. Even when the music stops people are still running to join in. I love it.
http://www.youtube.com/watch?v=GA8z7f7a2Pk

McFearless said...

"I also think this is a momentum thing... if this wave(P2) really climaxes with one of those parabolic moves"

Fwiw, I can't find many examples of parabolic moves with stocks to the upside. I've always found looking at tops for stock indexes it seems more like stock tops dissapate slowly, as the optimism fades away. Even in the 90's that looked like a classic extended fifth, not really a blow-off top. Commodities otoh seem to spike more on fear, and have those parabolic movements, fitting for the fear emotion, not for that of optimism, fear grips you fast, optimism keeps you holding on to that last little hope. I should have recognized this wasn't really happening with gold, and it makes me wonder if early in P3 that's exactly what is going to happen with gold, a fear spike...then down due to deflation. I think if we go much higher on stocks, it'll be a grind, especially given where MF cash is and that I still don't believe, even if they are buying now, that retail will "rush" back in. Just an opinion.

AmenRa said...

Karen

I see she has found a way deal with the situation LOL. She may still look to move to a non-extradition country in case Fuld throws her under the bus.

AmenRa said...

Oh yeah. Limit in, market out.

McFearless said...

From Bloom:

PPI inflation reversed course in February, coming off strong numbers the month before. The overall PPI dropped 0.6 percent after spiking 1.4 percent in January. The February fall was more negative than the consensus expectation for a 0.2 percent decline. At the core level, the PPI inflation rate eased to a 0.1 percent rise from a 0.3 percent gain in January. The latest core number matched expectations.

The drop in the headline PPI was led by a 2.9 percent decrease in energy costs after 5.1 percent surge in January. Gasoline fell 7.4 percent, following an 11.5 percent spike in January. Food cost inflation held steady at 0.4 percent. Within the core, tobacco prices dipped 0.1 percent as did light trucks.

For the overall PPI, the year-on-year rate declined to 4.6 percent from 5.0 percent in January (seasonally adjusted). The core rate year-ago pace slipped to 0.9 percent from 1.0 percent the month before. On a not seasonally adjusted basis for February, the year-ago increase for the headline PPI was up 4.4 percent while the core was up 1.0 percent.

karen said...

i'm reading the martin wolf column in FT.. excellent. also, $gaso did a neat trick, not, yesterday..

CV said...

@McF

I tend to agree with you that P2 top will have more of a "rollover" look, but that might only be in hindsight...

IOW, it might look a lot like the January 1150...

Massive swings back and forth (I'll be those took out a lot of stop losses - with people seeing the subsequent move and saying "oh my stops should have been set with more buffer)... So they buy back what was stopped out (because the market whipsaws back, only to have it dive the next day...

Dollars to donuts it looks something like that...

I-Man said...

Wolf's pretty good.

Mannwich said...

I have to admit I'm awed/fascinated by this market even more these days. We all have a pretty good idea of the ending but, like ahab says, how long can it go on?

Maybe it blows up again right around the last year of Obama's first term, just like it did W's second term? Anyway, I can't see this bubble going for longer than the last two, but who knows at this point? I sure don't. I know nothing.

karen said...

ben, the dbl top in dia could be 113.98.. will check spy next..

bob said...

Manny,

I think that the blow up in 2008 showed how much influence 'they' can have on elections. Who ever they are. Wouldn't be surprised to see it again.

Pitinoswaitress just served up the picks for the NCAA. Predicted pain for the ACC.

McFearless said...

C,

Also something interesting, Dan is back to putting up the 1930's chart yesterday, one thing is that drawing the trendline from a different starting point than the lows gives a better look then of when the primary trend was broken, and it would probably be the same now, so we were all fooled drawing that trendline from the March bottom and then watching that get broken.

karen said...

spy 125 will be formidable, don't you think?

CV said...

Or, if anyone has the time, they could

Take a look at something like this

To see other instances how a similar phenomenon (as we've seen the tape for the past 28 days), played out...

The chart is from 1930 (same months & timeframe)... Didn't turn out too well as I recall...

Oh wait, Bernanke is a STUDENT of the depression... I'm sure he'll 'steer' everything perfectly...

WAIT! What's the steering wheel doing over there?

CV said...

@McF

We had the same thought at the same time...

I just 'embellished' it a little (as CV tends to do)...

I'm all flash, no substance... :-)

CV said...

@bob

ACC (in CV's analysis)

MD - to Sweet 16
Duke - to Elite 8
GT - loses in 2nd round
Clemson - loses in first round

McFearless said...

Here is a taste of some of the regulation I was complaining about recently (C, feel free to delete this crap, I'm just bored here)

You are receiving this email because our records indicate you are licensed in Massachusetts

On March 1, Massachusetts data security legislation aimed at reducing the risk of identity theft became law. When compared to other state and federal regulations, Massachusetts Regulation 201 CMR 17.001 is more detailed and specific – and we’ve enacted several visible changes to our procedures to comply. To ensure we’re in compliance with this new legislation, we will be distributing the Data Loss Prevention (DLP) tool to your workstation starting March 23 and will continue through the end of the month. This tool is configured to detect the movement of sensitive information on or off your computers. The definition of sensitive data includes: Social Security numbers, credit card numbers, client ID numbers, account numbers and driver’s license numbers. Refer to Section 7.12 of the Regulatory Information Center for a more complete list.

About the data loss prevention tool

As XXXXX announced in his 2009 year-end Technology update, this new technology will support current policies found in Sections 7 and 14 of the Regulatory Information Center (RIC) requiring you to protect client information and records. According to company policy, any client information and records sent outside our network must be sent through Message Center or encrypted using company-approved methods.

Once the tool is installed, you will receive messages letting you know when the tool detects activity that conflicts with policies for appropriate handling of sensitive data. These messages are meant to inform you that the tool is preventing you from:
• Copying or moving unencrypted files that contain sensitive data to a removable device (i.e., CD/DVD, USB drive, etc)
• Emailing unencrypted files that contain sensitive data

OK, so we've had a trial run with this recently as it is all new. About a week ago I sent a note to my biz partner about BND, and I say something about the price of it, and then I mentioned something about our corps tax bill. As a result of this email I'm flagged and asked who I was sending information to, why I was including numbers without documentation, and if the person I sent it to, who btw, has an f*ing email that only an advisor here can have, was a MA client and why if they were hadn't I sent through a different (secure) channel.

Very nice use of my time. I hate to break it to MA, but I can do all of this but if my client puts something sensitive in the trash at their home, the identity can still get stolen, as just one example. How about they punch a pin for a debit card into a store machine, and then that is stolen, etc. I could go on.....

CV said...

By the way...ALL

My MARCH MADNESS ANALYSIS will launce tomorrow morning (actually probably around midnight tonight EST)...

If anything groundbreaking happens in the markets, I'll combine the thread... But there's little to report chartwise on a tape that behaves as it has been...

bob said...

I had L'ville take out duke. Than again I have a special relationship with the coach. My one non #1 seed in the final four, villanova. Scottie is on fire.

CV said...

@bob

sounds like out FINAL FOUR brackets are similar...

I actually have CAL beating Louisville though...

I-Man said...

I have Louvull taking out the Blue Devils too...

And the Vols in the Elite 8!

Watch out for the Spiders, Nova!

McFearless said...

Karen,

re: DIA, yes you are right, it could be the double top there, that's not too bad a big picture, but I've got very little handle on this thing one way or the other in the near term.

I-Man said...

But my final four is pretty plain jane.

UK wins the crown.

McFearless said...

@I,

I know you are a Tenn fan but they blow up in the tourney all the time. Chism is the key to that team. I can't say I expect much from them.

Out of all things I speculate on I've had a ton of success with the brackets over the years. Of course, when you fill 20 or so out each year, you should win at least one.

All I can say about Duke as a Tar Heels fan is that I hate them...a lot, but respect them and I won't count them out going to the final four. The Plumlee boys are stepping it up, and they have some old heads on that squad that can provide leadership.

Here's a question, what is going to happen to Purdue in the first round?

CV said...

The DOW is thru to new highs...

It almost looks like they're managing to do it solely on the back of GE...

Somebody ought to do a wave count on GE...

Anonymous said...

Is it possible that there are a still few shorts left to squeeze? Could that be the explanation for the continuation of this upward grind? Shorts continuing to cover, just in progressively smaller numbers?

I mean, who in their right mind would be buying equities after a 120+ point SPX move, with so little volume and so little MF cash. Despite the silliness of the mainstream business media, most "bullish" money managers should have some sense, right? STL

bob said...

Huggie is going to be able to sprint for the first three games, then have to get out of his running suit.

I think that is the most interesting bracket.

Couldn't call the 4 13 for siena, but that was a hard one. They have a heck of a program building up.

Did you know that Joseph (likely starter for SU) has an older brother on VT? Bad omen there.

McFearless said...

I also think WVU is somewhat suspect, and Huggins has brought some serious talent to the dance in the past at Cincy, and they got bounced out early.

One year I believe they had bad luck though, I think Kenyon Martin had broken his leg not long before the tourney.

CV said...

@McF

I have Purdue losing to Siena... But I "hate it" because it's become a trendy UPSET pick...

Mannwich said...

@Anon: Who "in their right" minds were buying multiple homes in '05-'06 at inflated prices and stocks in '99-'00? Well, those same people are buying stocks here. People never change.

CV said...

Huggins always gets bounced...

Thing is, their path isn't that hard...

bob said...

Watching the DJI too. AA and JPM largest percentage gainers. Call me suspicious. Waiting for the close, and some volume.

McFearless said...

C,

I thought on that and still picked Purdue, but they only had 11 points in the second half of that last game. I don't know....

Manny,

Nice point at 11:32, exactly....

McFearless said...

I'm also very suspect of Kansas State, I've watched them fall apart several times this year.

Cuse getting worked in the first round is also supsect, I don't believe any team that lost in the first round of the conference tourney ever made it to the final four. I could be wrong about that though.

Anonymous said...

@ Mannwich.

Is it really that simple? People blindly buying stocks, anticipating a recovery? STL

McFearless said...

It's also too bad Northern Iowa got stuck where they did, that team could have shaken things up.

CV said...

@Manny (11:32)

Correction: Their "software programs" are buying them...

This ain't no "short covering" IMO... This is Jamies computers selling to Lloyds, and Lloyd selling them back...

Those are the two "wise guys" in the 3 card Monte game... The DEALER, and the PLAYER (who's in with the dealer), and looks like he's winning...

Then some chump walks in off the street, sees the action and says... "I want a piece of that action"...

At the point the sucker off the street walks into the game, Both Jamie & Lloyd skim a few shares off to sell to him...

CV said...

@McF

I have NI winning it's first game...

CV said...

@bob

I think you're right...

I'm on DOW WATCH here...

JPM, AA, GE should tell most of the story...

Mannwich said...

@anon: Probably not that simple. I'd surmise the not so "invisible hand" is at play here but people would throw rotten produce at me on this blog, so I won't go there. ;-)

bob said...

There were a few stories in the news about Norsk Hydro and how over supplied the market was with Al via china. Maybe its a trade protection play, but I don't see AA running this strong unless there is a major shift.

AmenRa said...

re: GE

Currently has a monthly 3LB reversal up as it's trading above 17.17. The last monthly 3LB reversal was down in Dec 07.

CV said...

I'm just trying to figure out a few scenarios for FIBO retrace levels...

from 1167.32

.021 = 1142.80

That would "kind" of be a nice retrace because there's a few days of support drawn around that level...

JTOL

Anonymous said...

@ CV (11.42)

So what you're suggesting is a complete absence of selling here? Manufactured volume amongst the institutional players and the occasional retail buyer to drive stock prices up marginally? That implies that the institutions are BAGHOLDERS themselves and they have vested interest in keeping the market up (at least until they are able to unload their shares). STL

Mannwich said...

I would theorize that the PERCEPTION out there is that the Feds won't allow a market crash (even if in reality they only have limited control over it), so it becomes a self-fulfilling prophecy for market participants to not sell out of greed/fear of missing only rallies to the upside. May sound like a simple premise, but perhaps the perception is that this is the "Mother of all puts" that puts Greenie's put to shame. Hence, here we are, another bubble inflating right before our very eyes.

Mannwich said...

It now pays big-time to be a thoughtless dummy in this country. Bottom line.

CV said...

@anon

Something along those lines, but a lot more complicated than that...

Think of it this way...

I separate "institutional shareholders" from "investment banks" (or insiders)...

Simply sketched...

INSIDERS
Goldman Sachs, JPM, hell maybe even MS, & BlackRock

INSTITUTIONAL
Most of the hedge funds, pension funds, large mutual funds run by 'tools', etc.

I'd say what I'd described with regards to the HFT are done by GS & JPM...

Institutional are mostly "mandated" longs... They pour money from automatic payroll inflows each month... They HAVE TO BUY... They have no other choice (sure they're interested in seeing it go up, but they can't BET on it going down)... If stocks take a dive, they still have to stay invested until they start getting redemption requests, then they have to sell... They're not actively "shorting" the market...

The INSIDERS (on low volume), can keeps tossing bids back and forth... But they can also pull the plug and go the other way whenever they feel like it... So some time passes, and they keep collecting "inflow money" from the ones who have to buy, at higher & higher prices, then at a given time they dump it right back onto the market (for the INSTITUTIONAL guys to keep buying)...

That's WAAAAY simplified, but you get my point...

At a certain point, the INSIDERS, therefore, WILL NOT be bag holders... The INSTITUTIONAL guys will... They're the sheep that will be led to slaughter (along with all their clients handing their paychecks over to them)...

Mannwich said...

From Rosie. Must be hard to be him these days.

The equity market at any given moment of time is one part reality and three parts perception. Our friend, Brian Belski at Oppenheimer was on CNBC the other day and claimed that this was turning into a normal economic recovery. And that is what many market participants seem to believe until they don’t believe it any more. Their resolve has been impressive. But if this were a normal cycle, then:

•Employment would already be at a new high, not 8.4 million shy of the old peak.
•The level of real GDP would already be at a new cycle high, not almost 2% below the old peak.
•Consumer confidence would be closer to 100 than 50.
•Bank credit would be expanding at a 14% annual rate, not contracting by that pace.
•The Fed would certainly not have a $2.3 trillion balance sheet
•And, the government deficit would not be running in excess of 10% of GDP or twice the ratio that FDR ever dared to run in the 1930s.
If this were a normal cycle, then there would be a ‘clean’ 5-6 months’ supply of homes on the market, not the 21 months overhanging as is the case now when all the shadow inventory is included from the foreclosure pipeline.

If this were a normal cycle, then the funds rate would not be near zero and one in six Americans would not be either unemployed or underemployed.

CV said...

They're "setting this market up" for the end of the quarter...

At the end of the quarter, the big mutual funds have to do their "portfolio rebalancing"... Johnny has been calling them all month (with all these green candles), and saying "Brian, looks to me like the S&P is really taking off here - I want to rebalance my allocation to take care of this REFLATION TRADE [that they herad about on CNBC & from Cramer])...

So Brian has to rebalance the portfolio and get some more GE in there (and "sell" some of that stodgy Kraft, or some of those "Granny" utility stocks)... Get me in on the BETA...

GS & JPM front run a little here, bid up the appropriate names, then when MoMo comes in with his order on the first of April, JPM & GS unload...

Now "Johnny" owns it (by way of "Brian")

Mannwich said...

It seems to me that "Johnny" has been doing far better than people like me these days........

Anonymous said...

@mcfear: from earlier: Yes, it's the 5 of that C down on the DXY count that is NOT an impulse at all. That's the main problem....-AT

CV said...

@Manny

Tons of "Johnnys" had some nice times for years between 2003-2007, when they financed a house for 100%, then took out HELOCS for a couple years as the price magically went up...

Right now, their so called "profits" (and their "lives" for that matter) are IN the JOHNNY!

Onlooker said...

Complacency? Never.

Mannwich said...

Oh, I know, cv. Just highly irritating to watch this spectacle over and over and over again. Idiocy, stupidity, ignorance, thoughtlesness and greed being rewarded time and again.

I-Man said...

I have Purdue, Ohio St, and Duke as the only big letdowns in the tourney.

Villanova I had a hard time with, but I have them going pretty deep. I think they bottomed out at the right time...

CV said...

@I-Man

I don't see Duke getting to the Final Four as a #1 seed, but their path may be easy (especially if Siena gets past both Purdue & Vandy)...

Ohio State, IMO, will go all the way to Elite 8... Georgetown has been playing well, but they are not deep AT ALL... They're going to tire out by the time they face OSU...

CV said...

On the DAILY Charts, the MACD for the SPX is almost bumping upon the "divergence" downtrend line which has been in place since last May 8th...

karen said...

check out the $wlsh.. check it long term monthly, and check it on the 60 minute..

karen said...

and if you really want UFB, look at $tran on a 10 year monthly..

(oh, and tell me why my huge long position dht.. never even came close to tagging along.. lol.)

you'd think we were experiencing an economic boom, not bust.

Mannwich said...

Flipping stocks is much easier than flipping homes. We can all be rich again.

karen said...

Jeff, now you are thinking!

Mannwich said...

@karen: And don't think others aren't "thinking" it (or doing it) either. Nothing's changed. Not one bit.

McFearless said...

@AT,

cool, thanks, I figured that's what it was, it's an odd five, in fact, I've been trying to find another five that looks like that and I'm drawing blanks. All the counts are hard right now imo.

@manny,

I think that is right, the the net social belief is that the Fed won't let the market go down, even BR says as much, but I wouldn't call it self fulfilling, nor would I call any market movement self fulfilling because of what that implies, which is that a trend would extend forever, but no trends do that. So while I agree that there is that perception right now, it still doesn't explain the cause. Hope that makes sense.

McFearless said...

I like OSU, lot of their losses came when Turner was out. Different team with him, he might be the best player in college bball. He's smooth.

CV said...

@Manny

I WAS thinking it last week...

I'm "short" the SPX (with about a 1145 cost basis), but back when we were were at KARENS TOP the last time - what was that? 14 straight green candles ago?)...

I had 'hedged' about 1/4 of that position with some UPRO... I thought I was pretty smart (actually was) for about a week...

But I sold that hedge on the day that we zoomed past 1130...

10 days later, that market has had nary a single down day...

Oh well...

CV said...

@McF

That's the key right there (Turner)... Getting him back was KEY...

Mannwich said...

@ben: What I'm asserting is that perhaps it can be self-fulfilling for A WHILE but, of course, when it reverses course again, we could see a mean cascade of selling. Isn't that partially what bubbles are/become - a temporary self-fulfilling cycle that goes on and on, often far longer than any rational belief thinks it can go, and then it comes to a crashing halt. I can't see how this time period is any different than the prior two bubbles. That's all we have now - a bubble economy whereby you jump on as early as you can for as long as you can and try to get out with alive and with a decent "gain".

McFearless said...

C,

OH I think so too, re Turner, much like Hummell on Purdue, in reverse.

One player can make a world of difference in the college game.

Think Stephen Curry....as a recent example.

I-Man said...

Oh, I forgot to mention Baylor... I have them and Siena in the 16.

karen said...

not that it matters but, on deck for tomorrow:

8:30 AM Initial Claims
8:30 AM Continuing Claims
8:30 AM Current Account Balance
10:00 AM Philadelphia Fed
10:00 AM Leading Indicators

McFearless said...

manny,

sure, I can get on board with the general idea of that, I just don't describe it as self fulfilling because it's something else driving it all, the thinking behind a bubble has to come from somewhere and I have provided more examples than needed to illustrate that exogenous events do not change the trend of the market at all, otherwise things would just keep going in the same direction.

There is a lot of new scientific study going deeper into this, but that stuff is over my head, so I stick to the waves. Maybe in a 1,000 years it will be a widely held belief, not in our lifetimes most likely though.

Bubbles are never going to end, social mood is going to keep causing them over and over again forever, but on the bright side, the general path for man is UP, just not in a straight line.

Jet Packs baby.

Mannwich said...

I realize that bubbles are unavoidable and part of human nature, but my preference would be the feds not aiding and abetting those bubbles and making the carnage worse for those who were not involved....

karen said...

We Were Promised Jetpacks!

karen said...

and in other news:

Shares in Harley-Davidson (HOG) the leading manufacturer of heavy motorcycles rallied on Tuesday amidst talk of a takeover of the company, causing the price to jump an 'extra big' 7.0% to close at $28.35 on 'extra high' volume of 18.4 million shares. The stock traded to a new 13-week high on Tuesday ($28.98). The stock opened Wednesday down a bit from yesterday's close, currently trading at $28.20.

Mannwich said...

I believe that many of us (including yours truly) theorized a while back that some of this "recovery" might be coming from those who have extra cash to spend because they're not paying their mortgage and living rent-free. This person has been doing it for THREE years. Sure, this is a normal "recovery". What a fucking joke.

http://www.calculatedriskblog.com/2010/03/squatter-stimulus-no-mortgage-payment.html

DL said...

VIX is way down today, but the CBOE equity put/call ratio is up 33% from yesterday.

McFearless said...

My preference would be no Fed at all. Fuck the Fed.

What they do is unconstitutional anyway.

DL said...

Mannwich @ 1:17

“my preference would be the feds not aiding and abetting those bubbles and making the carnage worse for those who were not involved”

**************************

Dream on, buddy.

Mannwich said...

Obama's new housing plan: Everyone lives mortgage payment-free (forget the renters, they're not real people anyway) for up to 12 months, with a possible 6 month extension. The real economy would just explode as people spend all that extra money on discretionary goodies! [snark off]

Mannwich said...

I know, DL. Sigh.....

McFearless said...

off to the races here....

DL said...

The longer this monetary and fiscal stimulus goes on, the more likely it is that we will get another 50% decline in the market.

My betting is, however, that such a decline will not occur until after the treasury "yield curve" has been inverted for at least six months.

Mannwich said...

I agree, DL. This whole year could well be melt-up city, at least through the elections.

Mannwich said...

Outta here. Sunny and nice outside and doggie getting chubby. Needs a walk and so does Mannwich.

CV said...

@McF

I have both Baylor & Siena in S16 also...

I have Villanova, then, beating Baylor and going all the way to Final Four...

If Baylor beats NOVA, don't count out Baylor then beating Duke to go to Final Four...

karen said...

can't wait to find out the "reason" for the 25 pt dow surge in the last 20 min..

I-Man said...

@ C

That was me you're responding to in your 1:39

DL said...

If the SPX is above the 1175 level on Friday afternoon, I'll be tempted to short it (cover on Monday).

I-Man said...

I think Nova is really going to be tested by the Spiders, and that bodes well for Baylor.

I'm not a ND fan at all, but think they will probably beat ODU, although there is certainly some upset potential in that game.

karen said...

$wlsh just crossed 12250.. another 200 pts to go and it will be atop the 200 ma at 12439.. also the 50 looks set to cross over the 100.. you have to see it to believe it..

karen said...

you know why this is,

Record Number of People Committed to Participating in Running Events in 2009 According to Active Network Findings
1:41 PM ET 3/17/10 | BusinessWire
The Active Network, Inc., a technology and media company, today announced that online registration for running events taking place in the United States in 2009 was up over 15 percent over the previous year.

cuz nobody has a job!!

karen said...

Bernanke and Volker @2!

CV said...

@Manny

"Obama's new housing plan: Everyone lives mortgage payment-free (forget the renters, they're not real people anyway) for up to 12 months, with a possible 6 month extension. The real economy would just explode as people spend all that extra money on discretionary goodies!"

---

I know that was just SNARK...

But let me just say, if an announcement like that WERE to be made, it would have the EXACT OPPOSITE effect... It would be an acknowledgement of EVERYTHING that is wrong and this whole thing is a sham...

You don't think they EVER want to do that do you? It's better to LIE and keep some 'tools' guessing as to what's real or not...

Meanwhile, all you longs... Enjoy your profits...

Just remember... THE VERY FACT that you're enjoying profits in this way (as DL describes), is sowing the seeds for an unbearable P3 down the road...

Even if you time it perfect, it is unlikely that your profits will be very rewarding to you in the end...

What do you think? You'll be sitting on a pile of money in the end? And that once the collapse occurs, you'll just be able to buy anything you want with all the cash you have on hand...

p3 isn't going to be like that... P3 is going to mean that the very goods you'd perhaps want to buy will be unavailable, ANYWHERE...

Or, when it happens, how do you think you're going to look driving your Ferrari down the street while zombies are throwing bottles at your car?

The food you'll neeed to eat will be just as hard to come by whether you have a billion dollars, or two nickles...

Now here's the thing... A HORRIBLE P3 is probably still avoidable... But the more assets get inflated in the process, the harder the PAYBACK is going to be in the end...

Think, for a second, where we'd be if there had never been a housing bubble... Perhaps not better off, but the ledge we'd be standing on wouldn't be so high...

karen said...

I'm glad I can entertain myself on CV's blog. My fixation on the markets knows no bounds, laughing..

DL said...

... and you're entertaining others in the process.

McFearless said...

Karen!

Wow, 1:47, no, it's not the joblessness, I'm digging up our recent discussion on this. Fascinating! Do you remember it?

@I/C,

Oh yeah, I like Baylor, Nova not so much. Haven't seen ND play once this year, that's a toss up.

Anonymous said...

Karen. We were promised Jet Packs? Do I get a H/T on that one? -AT

Anonymous said...

@ Mannwich, CV, McFearless

Your thoughts are much appreciated. Mannwich expresses the disillusionment that I feel most eloquently. Fundamentals don't seem to matter right now and as a science-oriented person, I prefer correlataions/trends that are evidence-based. Hopefully, I will be ready when fundamentals matter again and BURST this balloon. STL

CV said...

@karen

I'm glad you're entertained (not knowing whether you were 'actually' being facetious with that part of the comment)...

Anyway, that's why AT LEAST I try and say something funny in the Morning thread...

I'd be committing seppuku otherwise!

DL said...

If Pelosi brings the HC bill to a vote on Saturday, that could be good for a correction of at least 2% early next week.

CV said...

@anon

The trouble is, the more 'forensic' work one does, the more one realizes that there haven't been ANY fundamentals since the early 80's (when the P/E's were in the mid single digits)...

Certainly not since 'Greenspan' ever got his mitts on anything...

karen said...

Sorry, Andy, I should have credited you.. Ben's lead in was too perfect and you know how I like to KISS.

CV said...

@DL

Oh good, that'll bring us back to where we were yesterday...

DL said...

CV @ 2:02

You may be flirting with the line between "something funny" and "shameless marketing".

(Not that there's anything wrong with that).

DL said...

CV @ 2:05

If I short an S&P contract on Friday, and cover it 2% lower, that's still worth $1000.

Anonymous said...

@ CV

I guess fundamentals matter to markets only during corrections....STL

McFearless said...

@STL,

Thanks.

Just a thought though, as I hear that phrase a lot, when DID fundamentals matter in the last say, 20 years?

By every meaninful measure the economy was weaker in the 80's and 90's than it was in our previous bull, yet the market went to the moon.

Good luck in your trades, but remember, markets don't operate under rules like physics, which may be the reason you think they seem crazy right now. This is exactly what the market was supposed to do, a lot of us just misinterpreted it in the near term, I'm certainly guilty.

I-Man said...

Me too.

McFearless said...

It's not that fundamentals never matter, of course they do, it's just that the traditional way of looking at them, and the correlations that many spout off as "fact" are complete rubbish.

I mentioned this early this morning on the bottom of the last thread, I have yet to see a fundamental analysis model that can determine "value" in disequilibrium, where prices just will not clear where they are "supposed to"

CV said...

@DL

The only thing "funny" anymore, IS, IN FACT, "shameless marketing"...

CV said...

@anon

"fundamentals" only matter when Lloyd says they do...

mcHAPPY said...

RIP DXY

The DXY is making me feel about the same now as late November.

bob said...

I have ND upset in the first round. "gody" does 14-44 and the media cheers, he had almost 30 points.

CV said...

@DL (2:06)

$1000? Correction: according to this, only $470

DL said...

CV @ 2:16

That's one reason why passage of the HC bill could give us a correction. Lots of new taxes, and most professional money managers probably hate it.

CV said...

@DL

No... Instead, they'll be telling their clients to "stay in the market - you know, to avoid paying TAXES"...

What a friggin clusterf*** (surrounded by a circle j***)...

72bat said...

@ karen
to entertain the rest of us, you could perhaps change your shoes?

Anonymous said...

To the pros who do this day in and day out, these euphoric periods must seem a natural part of the cycle. One has to develop a tolerance, I guess. STL

McFearless said...

DX is only slightly below last Friday's low, so you can still allow for the fourth wave count imo.

A few more days though and that might need to be eliminated and called an ABC move instead.

Patience is key with the dollar, last year taught that lesson well.

DL said...

72bat,

... or even take them off.

(Hey, someone's got to fill in for Leftback).

Leftback said...

Yellow Card.

McFearless said...

@AT,

Another question, do you see the contracting triangle in the DBA?

That could be a great set up for a trade.

McFearless said...

DL @ 2:24 and LB @ 2:27

Classic, lol.

CV said...

@McF

I'm still skeptical that it'll end up as just an ABC...

Currency moves tend to go on for long periods of time... They don't usually get into patterns where they change directions every 2-3 months...

I don't see how the Europeans can stand by and let the Dollar & Pound all beat them to the bottom...

I-Man said...

Damn, DBA looks like its in serious accumulation mode today....

McFearless said...

For those interested in Wave, here is some nice free stuff to help sharpen the Saw:

http://www.elliottwave.com/freeupdates/archives/2010/03/15/Lessons-in-Technical-Indicators-Part-2.aspx

CV said...

Caesars Palace just set the odds at 5-2 that karen will change her shoes by the end of the week...

How about some toenail polish to go along with that?

McFearless said...

I,

that DBA is about to make a huge move IMO.

@C,

I hear you on the dollar. Time will tell like everything else, some wavers already flipped bearish on it again.

DL said...

McFearless,

"Free", I'll look at.

Leftback said...

LB is playing golf tomorrow.
Returning before Tiger, but with less fanfare, and fewer waitresses.

Hope to be back for OpEx.

McFearless said...

I have a trading question for the group:

How often do you use stops?

My answer is not very often....but everyone is different.

McFearless said...

DL,

Sign up for Club EWI, you get all kinds of free stuff from it. Even if you don't like EW they have a lot of good free TA resources as well.

CV said...

FWIW...

I was doing some paper napkin calculations...

From 1150, we did roughly a .09 FIBO correction (down to 1044 - 1046.5 was the actual number)...

If we were to repeat that sort of dip, I'm still thinking a good target would be the 1075 area... So to get a .09 retrace to there, we'd probably need to hit up around 1182...

JTOL

DL said...

McF

Mental stops, or stop orders entered with the broker?

(the latter, almost never).

DL said...

McF @ 2:39

I've seen a couple of their free videos.

They were O.K., considering the price.

I don't suppose they give away much of their valuable techniques for free, however.

CV said...

1082 would also make some other FIBO numbers hit some H&S levels...

McFearless said...

Since fundamentals came up, I thought this was one of my boy's more compelling recent comments:

"When you are brilliant, your mind is rational, your logic is sound, and yet your conclusions are continually wrong or inadequate, there is only one explanation: Your premise is false."

After all the data they present:

To summarize our findings up to this point:
1. No type of exogenous event leads to a consistent result in financial market movement.
2. The biggest stock market movements have no clear exogenous causes even in retrospect.
3. There are no consistent correlations or relationships between supposed exogenous causes and market results.

Do whatever you want with this information, I'm just putting it out there for others to read.

DL said...

CV,

My back-of-the-envelope calculation says that your paper napkin calculation sounds reasonable.

McFearless said...

DL,

No, all the best stuff still costs something. Never buy a book from that site, way too expensive.

And yes, I was talking actual stops, with the broker.

I tend to go more the mental route.

Leftback said...

Stops save you money when you trade against the trend.
Stops can cost you money when you trade with the trend.

Stops can protect you from yourself.

DL said...

"Stops can protect you from yourself".

I think we have a philosopher in our midst.

Anonymous said...

@MCF

Which way do you expect DBA to break?

CV said...

OBAMA'S BRACKETS

Oddly, they are VERY similar to mine...

Only main difference is that I have Syracuse going to Final 4 instead of Kansas State...

& I have Ohio State beating Georgetown

The rest is practically identical with a few unimportant games different in the first round...

CV said...

@anon

DBA?

I can't speak for McF, but that chart pattern says it will break UPWARDS

I-Man said...

Ditto.

mcHAPPY said...

Wow. This is absolutely obscene. What mcHAPPY cannot believe is the lack of volume on this latest leg up. It is too quiet. mcHAPPY has always doubted this rally - and still does. However, something feels different this time around. Maybe it is the good weather in mcHAPPY's neck of the woods but something feels different. Maybe it is the lack of break out in gold or oil as markets make new highs. Maybe it is the dollar declines do not match the market rally based on previous run ups. Something does not feel right.

AmenRa said...

McF

I always use stop. But I also primarily trade options on the S&P.

CV said...

@mcHAPPY

Just holding a mug of green beer in your hands (per the photo above), might bring some good "feel" back to your paws...

mcHAPPY said...

@CV

After mcHAPPY's reaming over the last 10 months, the alcohol won't mix well with the anti-depressants haha.

CV said...

I wasn't referring to the BEER silly!

DL said...

AmenRa @ 2:57

Do you mostly "go naked"...?

karen said...

i'll take them off if i can put my top back on, laughing.

mcHAPPY said...

See! Can't even think straight. Missed your reference this afternoon although did appreciate the pic early this morning.

Mannwich said...

On a MUCH brighter note, it's a lovely day here in Minny. Can't wait to plant the tomatoes again this year, along with some jalapenos, cilantro and maybe cucs.

AmenRa said...

DL

Once I'm sure of the direction using 3LB's then yes. I'm still not used to butterfly, strangles, etc. Covered calls are nice if you have the underlying equity.

CV said...

@karen

You're just building up the suspense until you whip out the RED ones... right?

DL said...

Karen,

Different shoes.... same feet...?

DL said...

AmenRa,

I do use SPY options from time to time. But one thing I don't like is that I don't know how to price them (because of time decay)...

With S&P futures (or ETF's), it's nice to be able to submit a limit order the night before the NYSE opens.

karen said...

The red ones are identical to the black ones.. thot i'd switch it up a bit. Anyway, the market is hot enough!

DL said...

Mui caliente

AmenRa said...

DL

Better to be itm with a delta of .70 or better. Movement is closer to the underling moves and time decay won't kill you after the 1st Friday of the month.

I-Man said...

That'll get you some more profile views fi sho...

Got any hemp kicks?

I-Man said...

DELTA!

Thats what killed me as an options trader.

CV said...

From the article in the "Obama's Brackets" link above...(this was from a staff writer at TheAtlantic)...

"But Obama is in a unique position for bracket picks: he is, after all, the president of the United States. He's supposed to be responsible, and there are stock markets to think about here. If he picked Montana to win it all, Iran might attack tomorrow. It's not beyond the realm of possibility that Ahmadinejad gets ESPN."

---

Question to group... Is that what Obama is supposed to be thinking about? The "stock markets" and his "NCAA brackets"... I know it's just an article, but it can't be that far from what people think...

Is that why all of you people voted for Obama? So that the "stock market" would rise, and so you'd have something to compare your NCAA brackets to?

Fill me in here...

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