Morning Audibles 7.7.10 - The Beatings Will Continue





Obama Says Direct Israeli-Palestinian Talks May Be Imminent: (Translation: Israeli missiles will be flying towards Iranian nuclear reactors soon, and we're here to help).


Excerpt:
July 7 (Bloomberg) -- President Barack Obama said direct Israel-Palestinian talks may get started within less than three months, praising Israeli Prime Minister Benjamin Netanyahu as a leader prepared to take “risks for peace.”

Translation: It'll be much easier to "talK" to the Palestinian Authority after their funding is cut off... Next headline, BP takes "risk for closing spill" by detonating a nuke...

The fact that the president suggested that direct talks are imminent means “he knows something that we don’t,” Aaron David Miller, a public policy scholar at the Wilson International Center for Scholars in Washington, said in a telephone interview.

Translation: The President knows that the US has placed a aircraft carrier unit on the Straits of Hormuz... Imminent talks? You betcha!

“What Obama now understands is that fighting with the Israelis is inevitable and appropriate if it driven by a strategy that can ultimately make the president, Israel and the Arabs look good,” said Miller, who was a member of the U.S. mediating team for Middle East peace efforts under former Presidents Bill Clinton and George H.W. Bush.

Translation: Especially if it makes "the President" look good... And he could use a convenient distraction at the moment with the DOW crashing and oil soaked seagulls...

---

Krugman Says U.S. Economy Is Facing a ‘Long Siege’ 

Excerpt(s):
July 6 (Bloomberg) -- Nobel Prize-winning economist Paul Krugman said the U.S. should have a “kitchen-sink strategy” that uses all fiscal and monetary policies possible to prevent the economy from sliding back into a recession.

Translation: Didn't Hilary (and others) try that "kitchen sink" thing before?



- At a time when European countries such as Germany are calling for austerity measures to rein in budget deficits, Krugman is calling for more stimulus to prevent a repeat in the U.S. of Japan’s decade of economic malaise in the 1990s.

- “The most effective things you can do, in terms of actual bang for the buck, is actually having the federal government go out and hire people,” he said. “We are deep in the hole here, and you need to be unconventional to get out of it.”

Translation: Prof. Krugman, YOU SIR, are in the deepest hole of all...

He said too many policy makers and commentators are overly concerned that the ballooning U.S. deficit would set off a crisis of confidence similar to Europe’s sovereign debt crisis. “I worry about the politics,” he said. “I worry about our ability to get a consensus to do the pretty straight-forward things we need to do to balance our budget in the long run.”

Translation: How about "passing a 2010 budget" for starters?

The projected U.S. budget gap in 10 years can be brought under control with a “combination of modest tax increases and reasonable spending cuts,” particularly on health care, Krugman said, adding it’s “extremely unlikely” the U.S. would ever default on its debt.

Translation: How about "passing a 2010 budget" for starters? As for taxes... Do you mean "tax hikes" like these? http://www.atr.org/sixmonths.html?content=5171

“I’m not aware of any example of a country that got into fiscal difficulty because it began a stimulus program and couldn’t take away the stimulus program,” he said.




“If you’re serious about fiscal responsibility, you should not be saying, ‘let’s skimp on aid to the economy in the middle of a financial crisis.’”

Translation: How about "passing a 2010 budget" for starters?

“We are, I think, sliding into a situation where we’re likely to see several bad years ahead,” Krugman said. “Given what I see in the political process, the odds are against us avoiding a really prolonged bad period.”

Translation: Moynihan (below), would disagree with you...

---

Liquidate, liquidate, liquidate
Commentary: Some inconvenient facts about fiscal austerity

Excerpt(s):

- A possible corollary in the context of the present rip-roaring debate about the macroeconomic impact of our dawning age of fiscal consolidation and austerity is that Nobel Laureates, especially, aren't allowed to make up their own history.

- So Professor Joseph Stiglitz please get out your copy of "Historical Statistics of the United States" and, after perusal of the GNP and government finance tables, consider retracting your preposterous statement on CNBC last week that federal spending cutbacks caused the Great Depression. Perhaps you might copy Professor Krugman while you're at it.

- When the public's new-found enthusiasm for autos, appliances, and home goods couldn't be funded by these new lines of credit, winnings from the stock market were available to make up the difference. While buying durables and stocks on credit is not an original sin, a central bank policy that caused consumers to plunge off the deep end into unaffordable debt possibly is. In any event, after the music stopped in late 1929, durable goods purchases virtually ceased through the mid-1930s.

---

Ah, hell with it... This is REALLY why the S&P can't catch a bid (other than PPT, MOMOS, & Kass)...

Lindsay Lohan Is Sentenced to 90 Days in Jail


Clearly, Ms. Lohan has seen better days (along with most of the other protagonists in todays narrative)...

232 comments:

«Oldest   ‹Older   1 – 200 of 232   Newer›   Newest»
bob said...

I have some issues with that marketwatch piece, the author switches between GDP and GNP at will to try and make his argument stronger.

"In 1929, the nation's GNP was $104 billion and by 1932 it had plunged to $59 billion."

GNP is GDP plus Net income from assets abroad, which would have been massively negative.

In the very least its a dishonest comparison.

mcHAPPY said...

CV,

Informative and entertaining as always. Particularly enjoyed the picture of Paulson and Bernanke in the strainer. That about sums it up, except it didn't show Blankenfein coming on the yacht loaded with suitcases full of 100's, beeeotches, and blow to save them.

Anonymous said...

excellent post CV-

that picture of Paulson and Bernanke bailing out the colander is priceless-

and of course- the Lindsay Lohan image staggers me

also- check out this post from Slope of Hope-

i am the most pathetic piece of crap i hate my f'in life and this f'in world i don't thin ki can survive i'm only alive b/c some ppl i can't hurt like that but i don't really care anymore the pain is too much to bear.

wow- now there is someone who needs to step away from the computer screen- had some bad trades, disillusionment or both

mcHAPPY said...

MarketWatch headline:

"Tuesday stock gains to wilt"

You mean all 5 of those SPX points are dying on the vine?

CV said...

@bob

True, but in the grand scheme of things I think that part of it is a little like splitting hairs...

The argument that trumps all arguments is...

Keynesian economics, or no?...

I hate to be that blunt about it, but too much time and effort is wasted (IMHO), trying to split hairs and come up with "soft landings", or try to shield various populations from the impacts of a downturn...

Of course... TO BE FAIR... CV, essentially, is also "talking his own book" here because I'm prepared as once could be (I suppose), for the worst...

In the end, I'll probably get steamrolled along with everyone else, but at least I TRIED... :-)

If anything, I'm going to stand in the front of the pack, draw my sword, point it at the enemy, and say... "Here I am - come & get me"...

Maybe I can take down 3 or 4 DROIDS in the process before I bite it...

bob said...

CV

I'm not trying to draw swords. That's a false dichotomy.

The author worked for Reagan during his first term, when the GDP to debt ratio started it's massive take off. I bet it wouldn't take me too long to "prove" he was a Keynesian with his own words.

http://www.usgovernmentspending.com/federal_debt_chart.html

I'm just suggesting that as with every other former founder of blackrock and hedge fund guy from CT he has an agenda.

Anonymous said...

Once a Floor, Now a Ceiling

karen said...

good morning! great one CV... : )

CV said...

@bob

No doubt...

No FREE PASSES intended here...

But two things strike CV as being particularly relevant here...

- In 1981, the Fed Funds rate was near 20%...
- Now, it's near, um ZERO...

Therefore, it would seem to me that "throwing the kitchen sink" at the problem (in terms of "stimulus spending" & in todays amounts & and for what, in terms of REAL PRODUCTIVITY it produces [other than keeping grandma's meds coming and giving here the cash to get to her bingo game])...

Is questionable policy...

Treasury is already doing about a $660 billion monthly roll on debt... More than $580 billion of that is in bills...

Do the math...

Anonymous said...

re stimulus/QE 2-

would the $ not take it on the chin- also- I wonder if the inverse relationship that occurred between the USD and the stock market play out the same-

I am sure that would be everyone's wish-

but I am not certain that would be the outcome-

also- look at the incredible amount of debt already before us- a congress that won't even pass a budget because of the glaring big spot light that would inevitably be cast upon them-

I wonder if a collapse in confidence could occur rather quickly w/ another unprecedented stimulus agenda-

I mean really- how long can we keep this stimulus game going- or is it now an ongoing strategy to limp along until someone pulls our card and calls our bluff

CV said...

@ahab

I'll get to that in a minute...

Looking for a short entry here...

Nic said...

Great post this morning CV.
Don't even get me started on Israel and Iran. If the economy flounders start another war, right? What is another one when you are already running two and one of them is the longest conflict in US history.

I love Lindsay Lohan as much as I love Paris Hilton so of course I am gutted today ;)

Nic said...

Ambac is about to be delisted, no surprise

bob said...

I'll take the other side of that, for argument sake.

He was writing a budget that was borrowing money @ 20%, now it's near zero. Who's getting the better deal?

The national debt during his "reign" doubled.

The ultimate problem we face is confidence now. I'm not sure that any amount of spending can change that. I'm not sure any politician can either.

bob said...

I saw a picture of "lilo" over the weekend. It's been a hard few years on her.

Nic said...

I cannot see how Benocchio can get away with more QE politically. Maybe I am wrong but the treasury lied to congress once ("we need to buy the toxic assets NOW") and perhaps next time they won't be such sheep.

Nic said...

I don't hate Lilo et al, I just think it is a shame that they are such big role models for SO many young girls.

karen said...

look at the chart formation of vxx..

bob said...

Agreed nic. We need some leadership. I just hope it's not the wrong kind.

Although, he can take a good whipping and still maintain his prozac gaze when being yelled at.

Maybe the sheep in congress can just yell at him for 2 weeks this time before they roll over.

karen said...

anyone tempted by faz this AM?

CV said...

@bob

I still beg to differ...

- First of all, at least they actually tasked themselves with drafting a budget back then (for better or worse)...

- Also, If you know that rates are 20% (a historical high), you're probably looking at the prospect of rates coming down (or some "mean reversion")...

- Now, with rates near zero, the ONLY THING THAT CAN HAPPEN is for rates to blow out and exacerbate your problem...

- Unless you know that rates will stay low forever...

- Which means that the printing presses will be running NON STOP...

- Which makes the Weimar Germany on that FINE DAY when you realize that all your stimulus has "worked" and it's finally time to withdraw "liquidity" (which, I know, is a stupid word)...

All that's happening with STIMULUS now is for the THIEVES to get their hands on raw goods (with printed dollars) while they're still cheap...

When the music finally stops, the average person (who is living hand to mouth) is going to up the creek because he doesn't own stockpiles of those
raw goods (because the crooks looted the Treasury to hoard it for themselves)...

On a weighted basis, the cost of food & raw goods ranges from 60% - 75% CHEAPER than it was back in 1980...

When those prices revert back to mean (when STIMULUS IS REMOVED)... It's going to be a bitch...

The more you "stimulate" now, the worse it's going to be...

karen said...

we've been open less than 3 ten min candles and i already feel as tho it has been half a day! maybe i should go back to bed, laughing.

mcHAPPY said...

Karen,

I just took a position in FAZ at 1033 on SPX.

McFearless said...

C,

Nice post man, lots there. As for Lohan, the pic they showed of her in court on yahoo yesterday didn't look like the pic you have....she looked old, but that's what too many drugs do to you, Keith Richards based on appearance is probably like 215 or so.

for the group,

any of you familiar with floating rate funds?

just throwing this out there, we get a lot of (annoying) visits from mutual fund wholesaler companies that want to pitch us on their "fund o' the quarter" or whatever is "hot".....the hot item this year are floating rate funds, and mutual fund companies are all over this action. Every single person that has come in this year, many of them multiple times, has pitched floating rate, so it's in everyone's script.

the last thing I can remember that all of the wholesalers talked about like this was late 07 to mid summer 08, and it was China, China funds, decoupling China, etc.

McFearless said...

I see that statement a lot lately:

"we need leadership" and I do not at all disagree, however, from a socionomic standpoint...this is worrisome, what kind of leader is the current social mood going to put in place???

Nic said...

ZH: Baltic Dry Index Slides 5% To 14 Month Low, 30th Consecutive Day Of Declines http://bit.ly/cJRrHp

bob said...

CV, I am not going to defend letting this group of jerks spend anymore on themselves.

But I also have a big problem listening to a guy lecturing about the need for austerity when he did the exact opposite when he was in charge, and he was paying a lot more for it.

That, and what is good for a hedge fund guy is probably not good for me.

72bat said...

@ bob
"I have some issues with that marketwatch piece..." the author, indeed David Stockman of "trickle-down" economics reknown:
"As David Stockman, Reagan’s budget director, put it: giving small tax cuts across the board to all brackets was simply a “Trojan Horse” that was used to get approval for the huge top tax bracket cuts."

Nic said...

I-Man
SPX is a bearish gartley fibonacci pattern, invalid if price breaks 1038.5

CV said...

@Nic

"Maybe I am wrong but the treasury lied to congress once ("we need to buy the toxic assets NOW") and perhaps next time they won't be such sheep."

Nancy Pelosi says...

"We just have to pass the Healthcare Bill to see what's in it." - Nancy Pelosi (Quoted March, 2010

bob said...

"What kind of leader is the current social mood going to put in place???"

That worries me too.

Floating rate funds sound a lot like ARS, without the AAA.

McFearless said...

Ok, I had to read the MarketWatch article, i wasn't going to, but you guys.....


anyway, my reply:

anyone that thinks government can stop the current problem is a dumbass in every way possible, 70 something years later and we are still debating what "caused" the great depression, you can't solve a problem if you don't know what it is.

McFearless said...

this caught my eye:

http://finance.yahoo.com/news/China-AgBanks-massive-IPO-apf-1297191091.html?x=0&sec=topStories&pos=3&asset=&ccode=

bob said...

EURUSD

1.2550 is the level to end all levels. Above, all in to SPX, below and everyone runs for the exit.

CV said...

@bob

I'm not trying to get the last word in here (or defend DM)...

But all I can say is... For arguments sake... It's RELATIVE...

Frankly, If I bought a house & financed it at 20% (then rates came down and I was able to do a REFI at 10%)... I think I'd be A LOT better than someone who bought a HUGE HOUSE with a 0% TEASER ARM...

"Look honey... rates are low and I can make the monthly nut... Let's get the McMansion!"...

AmenRa said...

What did I miss? Why is the market trying to push higher? Did they feed Johnny some BS and he bought it hook, line and sinker?

CV said...

@Amen

Johnny bought the "hook & line"...

The "sinker" is forthcoming...

bob said...

CV,

I agree, I can't argue with that.

CV said...

1039 is the 78.6% fib retrace between a straight 1026 and a straight 1044...

McFearless said...

I don't think Johnny is buying, nor have they been for many months...but the doug kass' of the world are....I know most of you don't watch CNBC, but it might help some of the confusion about why the market is still being bought, it's "pros" in most instances that are calling for dip buying.

McFearless said...

C,

re: 1039

i'm thinking one way or another that neckline on the H&S needs to be tested....that's closer to 1050, so maybe we play the "18" game again....I missed my last chance above 1040, I will not do that again if we go there.

CV said...

@bob

Cool...

& that's the only point I'm trying to make here...

I think it's VERY DANGEROUS coming up with trillion dollar stimulus ideas at near zero rates...

On a sovereign level, it's like Johnny buying that McMansion (with a teaser rate) back in 2005...

The sovereigns HOPE that GDP will improve (just like Johnny HOPED his house value would rise to the moon...

Hey, no problem... If that pesky "debt servicing" gets in the way, I'll do a CASH OUT equity re-fi... Right?

CV said...

@McF

You could be right... I'm not waiting around... I took a shot at 1039...

Not the whole nut though...

McFearless said...

banking sector looking pretty stout so far today....

CV said...

@McF

Look - If this thing happens to break resistance and go up...

Frankly... I don't think it will stay up for very long (at least past the 200 or 50MA's)...

"Feels" to me like some managers may want to make HAY for Q3 all in the space of one week, then hunker down to cash for the rest of the quarter...

Nic said...

There is talk in the market that struggling software giant Microsoft may buy struggling mobile phone giant Nokia,
Nokia has a market capitalization of about EUR 25 bln…
Rumor only, but may explain some of the buoyancy in the markets today…
From ForexLive (not just good for forex)

Anonymous said...

Replay of yesterday. Bots buying and selling.

CV said...

Look...

SPX hit 1010 on July 1st... If you were "FIRST MAN IN THE WATER" (and bought that - as a manager)...

You could have unwound at 1040 for a 3% pop...

When Q3 is done, I'll betcha 3% is going to be a GREAT performance...

McFearless said...

C,

make no mistake, huge bear here, but,....

we could use this rally to help work off the oversold conditions

we've got opex coming up...

most important

if we are in some sort of wave 3 as EWI has been saying, well, you have to have your doubts at this point, there are other wave patterns that point to different outcomes that are likely more valid in the near term, yesterday's decline looks like 7 waves so color me skeptical in the very near term

McFearless said...

oh, and btw, from yesterday's low to now you can see five up.

mcHAPPY said...

We just broke yesterday highs on DOW. Sugar.

Anonymous said...

Lots of people need a nice big exit rally, especially now that we have seen the Death Cross. Credit market doesn't seem to be buying this.

McFearless said...

Total Solar Eclipse is July 11:

http://eclipse.gsfc.nasa.gov/OH/OH2010.html#SE2010Jul22T

AmenRa said...

I get it now. They're trying to recapture 1040. I call BS. The banking sector is BS also. There is absolutely no reason for them to trade higher. Flat is cool, higher isn't.

McFearless said...

I'm thinking some people were trading the small H&S today, thinking today was going to be the right shoulder and then down we go


foiled again....

McFearless said...

"There is absolutely no reason for them to trade higher."

but wait, since markets are efficient and we just got that "news" they are running drug money...no this makes perfect sense, think about the profits!

snark-tastic.

CV said...

@McF

I won't dispute your "short term" prognostication...

My mind keeps coming back to the June 15th - June 18th candles (also OPEX)...

That was an important level as well (around 1110, which was the .09 MF from 1220)...

3 straight "doji day closes above that level (without much thrust)... Then, on OPEX Friday, and attempted breakout, move to 1130, BAM - selloff)...

1041 is a MF just as 1110 was...

Look where we are... Does the market seem ENTHUSED as it was at 1110?

Ask yourself...

CV said...

Tesla Watch - Day 2

LOL

http://www.zerohedge.com/article/telsa-drops-post-ipo-low-hits-1556-stocks-go-berserk-no-news

McFearless said...

fibo this and that....here, just rationalize the market going up with some news:

http://www.bloomberg.com/news/2010-07-07/u-s-retailers-sales-increase-most-in-four-years-overcoming-job-concerns.html

McFearless said...

who was it that was questioning the price action in Tesla after the IPO?

I can't remember.....hehehehe

Anonymous said...

The next train wreck, probably in 2011.

Banks and Munis

McFearless said...

here is google's view of the renewed interest in "luxury"

huge bounce eh?

http://www.google.com/finance?q=GOOGLEINDEX_US:LUXURY

CV said...

I don't have a job, my unemployment has run out and I'm TOTALLY STRESSED OUT...

So I think I'll go shopp(lift)ing...

McFearless said...

but anon, I had the blago look-alike from Eaton Vance tell me exactly this:

Muni's won't default, and if they do Ambac will just pay.

I almost swallowed my pizza crust whole when he said it...

CV said...

Bobby Gonzalez Is Accused of Stealing

http://www.nytimes.com/2010/07/07/sports/ncaabasketball/07gonzalez.html

Hey - If you're gonna shoplift, you might as well go after the LUXURY ITEMS...

bob said...

MCF

Sounds more and more like ARS.

Vuvuzela said...

Blow me.

McFearless said...

bob,

no joke....pretty scary.

there's 1044 and here we go to test this neckline.....1,100 should offer stiff resistance, looking for shorts now, haven't done anything yet though...

bob said...

MCF, wrong fund, my mistake.

I followed the beginning of the bond insurance thing here in NY. I followed most of the pols involved. Not pretty.

Spitzer asked, in the week before the hooker came running out of the closet, "why is NYS paying for bond insurance when the CDO's and MBS's are going to completely drain any cash they have, leaving none for the protection of the munis".

Anonymous said...

What's that hissing sound? No bubbles in Canada, ey?

Pop

Anonymous said...

b22-

I like that google chart-

luxury going down yoyoyoy . . .

McFearless said...

ahab,

no no, you are looking at that chart all wrong you nabob of negativity

look at THE LAST FEW MONTHS

huge!!!!!

lol

mcHAPPY said...

The NAZ filled the gap from yesterday's open but it has not broke yesterday's highs like SPX and DOW.

RUT has not filled the gap nor has it broke yesterday's highs.

Hmmmmmm..... higher?

McFearless said...

mcHappy,

fwiw, I often will look at that type of non-confirmation the other way, when the higher beta naz doesn't confirm I think bearish...this is how it played all during Primary Wave 2 and also often during Wave 1.

mcHAPPY said...

From yesterday's lows to now we have an A=C.

Possible that something ended at the lows on the first?

Maybe in a 4th wave with 5th to go?

That would take us to 980 pretty easy.

ALthough there seems to be a lot of 980 and 878 talk around the net.

I'm sure it is most likely as the destination is rarely the issue, just the route.

McFearless said...

@I man

you out there?

what are the mini's orders looking like?

this is a major battleground right here.

McFearless said...

McHappy, we won't stop there in a wave 5 if that's what this is, I'd bet it'd be an extended fifth and appear more like a mini crash than just stopping in that range.

I-Man said...

I'm here... riding the waves.

Trading dow mini's this week for training, havent peeped the ES.

Without glorifying anything, my best trades today have been on the long side, and dont really see a reason why that wont continue today.

This is the day I thought we would have yesterday!

Nic said...

I paged I-Man

bob said...

OPex-

This is one of those months where VIX expires the week following the equity and index options.

April was the last time this happened.

mcHAPPY said...

Well, I'm all short. 1/3 positions put in at 1033, 1040, and 1044.

A break of today's highs or a solid 3 waves down will have me out in a jiffy.

McFearless said...

alright, neckline was basically tested, no strong break up over it....double test?

I have limit orders in on Sep puts but I'd rather not say which ones....nothing filled yet, I put some lower bids on it thinking we'll revisit today's highs at least once.

Spiro T Agnew said...

It's "nattering" nabob of negativity you moron...

Get it right dammit! :-)

McFearless said...

what did I say yesterday about not being a dummy on placing your stops right near the neckline, and here we go with a post from Dan's board:

"Stopped out basis 1043, ouch!"

that shouldn't happen....

I-Man said...

For the YM, (dow mini) I could see a case for 10K again before we get back to fun on the short side.

As some were saying late last week, it almost felt like there were too many shorts for the mkt to breakdown further...

Market wanted to throw the bulls a bone, let them dip buy, get us back to 10k, have everyone let out a "phew!"... and then reintroduce them to the downtrend.

Just part of the tapestry...

Still looking for new lows in July, but not for a week or two. The full moon on the 26th looks like it might be interesting.

McFearless said...

Spiro,
I left off the nattering since I don't actually speak with ahab but hey, I really hate messing up sayings of guys like Larry Kudlow so thanks for the correction...Larry deserves better.

Phil Connors said...

@I-Man

This is the day I thought we would have yesterday!

"I was in the Virgin Islands once. I met a girl. We ate lobster and drank pina coladas. At sunset we made love like sea otters. That was a pretty good day. Why couldn't I get that day over and over and over..."

mcHAPPY said...

1083.56-1010.91

.382 = 1038.66

.5 = 1047.24

McFearless said...

here comes our second test....

also, up for consideration:

If we are going to run with an impulsive count then today favors us being in wave ii, in which case we might be able to tag 1098.....it's not my call, just preparing for it.

CV said...

1098 is one of those "18" numbers...

McFearless said...

perhaps some sort of triangle will now form, 3 legs on the intial move down off today's high, three moves back up to try and retest it

McFearless said...

some people at Kenny's are counting that rise today as an E wave of wave iv....I'm not sure about that idea...but it's out there now.

McFearless said...

where the hell is everyone today? This is the most exciting market day we've had in a couple weeks imo.

Anonymous said...

. . .and people like Kass-

I wonder if he is saying the lows are in for the year because he's all in- long

pretty much a lock-

that's why everything financial pundits say should be greeted w/ skepticism

and this Altucher character- his "unleashing the PPT"

wow- pretty much says it all- I guess all morality and ethics and any fleeting sense of fair play would be tossed out the window for the policy goal of supporting stock prices-

my impression is that the Fed had been involved w/ futures the whole while anyway- but I doubt they would do so overtly

CV said...

@McF

I think everyone is fed up with how BLOGGER was behaving yesterday...

Nic said...

Doug Kass interviewed by Jon Najarian this morning:
http://finance.yahoo.com/tech-ticker/doug-kass-stocks-have-hit-bottom-for-the-year-517083.html

McFearless said...

Here's some thoughts...
looking at a dow daily bar;

if you go back to the all time peak in 07 when we started our intial descent into what I think was Primary Wave 1 it took 69 days high to low in the first big move down into early January 2008

If you look at the march lows to the June 2009 highs that took 67 days from low to high.

If you look at the middle part of the decline I'm calling Primary 1 from the top of wave 2 to the bottom of wave 3 it took 131 days, from that wave 2 high to the Primary Wave 1 bottom in March 09 it took 201 days.

Now going back to what I think we would call the Primary 2 rally, the middle of that rally from last summers lows on the failed H&S to the highs from january of this year was 134 days, the entire middle portion of the rally from that first reactionary low last summer to the peak in April was 201 days.

from the April highs...67-70 days of intial decline to start P3, followed by a reactionary high that could take a few months and then some wicked selling off that top for 130-150 days.

I gotta step out for a bit...would love to hear some thoughts.

18 said...

limit order for SDS filled, 36.65
see what happens on this swing trade

will cash out if SPX gets to 1026

CV said...

@McF (12:01)

Here's what BRADLEY thinks...

http://forbestadvice.com/Money/Gurus/DonaldBradley/BradleyTurnDates2010.html

karen said...

okay, i'm back! AR @10:42 (coincidentally!) agree, agree!

karen said...

another must read: It's time to pay for lunch.

If inflation once again becomes a monetary phenomenon and that phenomenon is pointing to deflation, then policymakers are facing two conflicting and irreconcilable truths. On the one hand, the fiscal conservatives are absolutely correct that the current fiscal condition of our cities, states and nation is structurally unsound. Budgets are not in balance, and borrowing continues hand over fist (particularly at the national level). On the other hand, the risk of deflation is more real today than it was when the Fed last expressed concern about it in 2002-03. Critical segments of our economy are still struggling, and unemployment seems to be changing from a cyclical problem to a secular verity.

America has enjoyed a free lunch for quite some time—our currency enjoys reserve status around the world, and we pay our debts with currency we alone print. We can’t escape the feeling that the check for lunch is about to come due.

mcHAPPY said...

A break out off a triangle?

OR

A collapse off failure to push through for quite some time?

I-Man said...

breakout

Nic said...

Patriotism ... Dutch pornstar style (get google to translate this page for you)
http://www.telegraaf.nl/prive/7130987/__Pornoster_deelt_blowjobs_uit_als_Oranje_wint__.html?p=2,2

arbitrage789 said...

Nic @ 12:55

"Pornoster deelt blowjobs uit als Oranje wint"


Not sure that really needs translating.

Anonymous said...

Classic! Lowering the tone delightfully, there.
Here's one for the ladies....

Super Squid

I-Man said...

boom!

arbitrage789 said...

I-Man,

You seem to be less "wedded" to either the long side or the short side than you've been in the past.

A good way to be, for a day trader.

McFearless said...

"A good way to be, for a day trader."

I'd think you have to be as a trader if you expect to win on balance...

I'm gaining confidence we see the 1098 but we'll see, long way from there still.

CV said...

@DL

Playing "counter trend" and being Doug Kass ought to make a lotta bank in P3 don't cha think?

I suppose your chances are 50-50, right?

I-Man said...

@ DL

Thanks!

Its forced me to trade what I see, no time to think really.

bob said...

We're at some pretty critical support resistance in currency world.

GPBUSD at recent double top. USDCHF near 5 month low. EURUSD back at recent top too.

arbitrage789 said...

CV,

Not sure what you're saying, because Kass is currently long. However, since he spends more of his time on the short side than on the long side, he should do well in a real P3.

CV said...

@DL

Forget about Kass...

You're missing my point... I'm going to drop it...

Have fun playing counter trend...

Leftback said...

JPYUSD double top. Keep an eye on the carry trades. BoJ selling could spark a little move for the commodity currencies here and that tends to carry equities along for the ride, for a while.

1040 will be back to being the floor and not the ceiling, but only if we close above that level. The Death Cross/KT would be the limit for any upside move.

arbitrage789 said...

CV,

I think the market can rally over the next 2-3 weeks.

McFearless said...

lefty,
there have been times in the past that the death cross marked a major bottom actually...I put up the spreadsheet of all of them since about 1920 a couple days ago.

I-Man said...

Anyone else gettin pumped for Germany/Espana?

:)

Leftback said...

Death Cross hardly ever fails in ZIRP/QE regimes. As you know I am a student of keiretsu phenomena. Note how well the DARK ONE predicted the Nikkei waterfalls, in these charts from the 90s:

http://garyscommonsense.blogspot.com/2009/08/japan-during-deflationary-90s.html

BTW, I am net long equities, and added HY credit last week as well. I like DL's call for a 2-3 week rally, unless earnings crater, which they won't... yet, thanks to accounting magic.

Look forward to the usual revisions and restatements in the Fall, and then the Kitchen Sink Quarter.

Shaken, not stirred.

McFearless said...

left,

nice, I hadn't looked at that and considered it that way re: Nikkei...thanks!

CV said...

@McF

I made a comment about that chart yesterday...

Results are MIXED, but there's the kicker...

The major "crosses" since 2000 have been as follows:

2000
2004
2006
2007

2000 and 2007 went VERY bad...

2004 & 2006 didn't do so bad, but we were in the middle of a time when the "subprime mess" had hardly even made it to the airwaves yet...

People were pulling money out of their houses like the was no tomorrow, banks were lending, S&P had been rallying, VIX was going down...

I also noted that upon making the death cross, there was a tendency for the market to go up and at least test the 50MA...

The kicker on that is that YESTERDAY was 50 days since 1220...

Within 6 more days (after today), the FLASH CRASH candles and beyond will factor into that average... It's at 1104 now (and about to drop like a rock)...

Meanwhile, SPX has moved from "oversold" to "overbought" quickly on the shortest term indicators as of today...

93 a minute ago on the 2 min tickers (with 3 bearish divergences)... 78 on the 10 minute tickers...

IOW - This market better move FAST and quick if it expects to REALLY regain any lost ground...

Which is why I'd have to politely disagree with the notion of 2-3 weeks of rally...

Picking flowers along the way (just like we'll do as we skip on down to re-test 666, I'm sure)...

Nic said...

LB
Bespoke Invest has a good article about earnings performance just posted:
http://www.bespokeinvest.com/thinkbig/2010/7/7/earnings-season-starts-monday.html

I-Man said...

who you got today, LB?

And is Germany without Mueller today?

Leftback said...

McF: There are regular markets and then there are QE/ZIRP/HFT/PPT markets driven only by liquidity infusions. Different rules apply.

"Don't let the smooth taste fool ya.."

Bruce in Tennessee said...

Q: Why did the cyclops quit teaching?

A: Because he only had one pupil.

Leftback said...

Trochowski in for Mueller.

I have got Spain, b/c they are solid enough not to concede early.
As for the Final, after Nic's post, LB would have to go Dutch.

Nic said...

I am shouting for Spain today

Leftback said...

Spain have the patience to sit back for a long time, are unlikely to concede a crappy goal from a set piece or punt down the middle, and are not going to get sliced apart on the break by German speed because they keep a better shape than England and Argentina. Müller is a significant loss.

arbitrage789 said...

McF @ 1:46

On the subject of the Japanese market:

http://tinyurl.com/2a7m7dv

CV said...

I also noted (10:44)

That as far as REGAINING critical levels is concerned...

It tried to do that at the 1110 level a few weeks back as well... 3 straight closes over that level (then a morning thrust up on OPEX Friday)...

Then - trap door...

H&S patterns, to CV, have the same value as Bernocchio's PHD... Take 'em for what their worth (as far as affixing confidence to them)...

Nic said...

Vix Sonar report:
http://www.youtube.com/watch?v=XZVhM1uAaRI

Nic said...

How noisy is that pit haha

Nic said...

MR TOPSTEP:Top Notch Cruel Summer
http://www.youtube.com/watch?v=bs8VKx1U2Dg

Anonymous said...

Pass the Bear Lube, please.

McFearless said...

C,

I do not subscribe to the notion that the rules are different in QE than they are in "normal markets" however that is going to be defined otherwise I'd have to disreguard my primary market tool which is EWave, it could not work then if that was actually the case. While I thought the Nik observation interesting, I never trade with ideas that come from moving averages.

perhaps I am, but I do not think I'm using a tool that doesn't work, I've made way too much money with it for it to be "luck" and I've seen too many amazingly accurate long term forecasts to chalk it up to chance, such as the one where EWI called for a huge rally last Feb before any QE announcement or PPT stunts.

as for how long the rally lasts based on the way I'm mapping the fractals of P1 and P2 and the time durations of trading days during both as I laid out up above I dont' think it would last 3 weeks, maybe a week/week and half....I'm not day trading, so my only motivation is to identify these rallies to take profit ahead of them or to identify short entries.

AmenRa said...

There's 1:50 left in the day. The bulls better make sure the pen is locked up tight. If one bear gets in then the rest will follow. They are tired, beat up and hungry as hell.

CV said...

@McF

I'd give it 7 more days max... (takes the 50MA to the flash crash candle, timewise)...

If someone wants to get creative and call that two weeks... Be my guest...

CV said...

@Amen

Danny & Co. were calling for 1052 as a possible target...

Some in those pits think we could easily get back to todays opening level...

Again... Low volume meltup... No BEARLUBE needed...

Anonymous said...

Right now it's looking like spring in Pamplona...

McFearless said...

C,

Like I said about two weeks ago, unless you are a bang day trader like Nic or I-man, going long on these counter-trends is no different at this time than trying to short the huge rally all the way up last year.

karen said...

oh, i definitely see this thing sinking back to the open.. I would be a buyer of sds under 36.. have a limit order in for drv at 7.79..

mcHAPPY said...

Very interesting....

There is a five waves up off yesterday's lows on NAZ, DOW, and SPX.

CV said...

Here's a summary of why Johnny's 401k went up today...

Stocks in U.S., Europe Rally; Treasuries, Dollar Erase Gains on Earnings

http://noir.bloomberg.com/apps/news?pid=20601087&sid=a6fQoMbfj2pE&pos=1

July 7 (Bloomberg) -- Stocks rallied while the dollar and Treasuries erased earlier gains, as growth in U.S. retail sales bolstered optimism in the earnings season and investors speculated that European banks will pass stress tests.

On EARNINGS (in headlines)... In article, "on optimism in earnings season"... details, details...

Oh yeah... and those European banks are going to pass those draconian STRESS TESTS with flying colors...

Rally on Johnny!

Leftback said...

The commodity sector is going to remain weak, and sooner or later there is going to be another huge rally by BUCKY, but we aren't there yet.

There are some tradeable bounces here and there in bear markets and this is one. We reached panic buying levels in USTs and JPY last week and that has to reverse to some degree, which will take some time.

Enjoy the game, everyone, or watching the squeeze, or just going back to bed, as you prefer.

CV said...

@Anon

Do you have a point to make other than talking about Pamplona and bear lube?

Any wisdom? Any market calls? Stories about Lilo that we all missed?

Leftback said...

Any thoughts on crude at $74? Karen?
This looks tempting from the short side here.

CV said...

@McF

Look - I agree with the observations of some that the market has been flashing OVERSOLD signs...

However, the move down from 1220, to these eyes, still has an uncompleted look to it...

And recall the "holiday" shenanigans it required to keep it from going into 3 digits these past days...

Therefore, COUNTERTREND (despite ST oversold), seems a bit of a "coin flip" (which yesterdays trading, and even late day Friday trading, pointed out)...

arbitrage789 said...

Nic,

McFearless (@ 2:18)called you a banger.

karen said...

semi interesting: These tales of hookers and half-hookers and gold diggers and fame diggers and "soul mates"-it all presents itself as censure, but the sheer volume of media, the obsessive attention to it, represents a kind of cheering on. "We really want to believe that powerful men have harems or the equivalent," as a prominent female West Village writer of 50 put it to me, "because it's reassuring us that boys will be boys. The alternative is unthinkable."

She went on to speculate that famous male serial cheaters want to be exposed. "I think being held up as the bad (yet randy!) boy in front of a nation is kind of a turn-on for some of them. A lot of men want to think of themselves as naughty, and of course they know that other men will envy them, which is one reason, no doubt, that they are so ambitious in the first place."

http://www.observer.com/2010/daily-transom/postmodern-hester-prynne?page=0

spoonman said...

nobody seems to have pointed out we're testing the breakdown of that head and shoulders at 1050. Isn't that where you're supposed to go short? If you believe in the power of dandruff, that is...

Leftback said...

C

There are almost no nasty data releases scheduled until existing homes July 22, and we have auctions of Ts next week, so they will sell off the bonds for a bit unless someone lays a massive earnings egg.

After existing homes, new homes, durables and then the NFP soon after that will make the end of July closer to Wile E Coyote time.

McFearless said...

DL,

i guess that could be a yellow card, but I meant it with respect, Nic actually puts her positions right on her blog. I like that, she's not hiding behind anything or making wishy washy calls that can't be proven right or wrong.

C,

Uncomplete move from 1220....ever heard of P3?

lol!

karen said...

Crude oil is simply moving with the indices.. when the spx drops so will crude.. 74-75/1050-60 probably it for the day.

Leftback said...

Just trying to see both sides, man.

Like Spain and Germany.

McFearless said...

spoon,

see my 10:24 post above...

CV said...

@McF

You know I'm talking minute 1 there...

Frankly - I think "futures" and some of the European bourses hit close to their marks...

For some reason, the SPX didn't (I wonder why)...

McFearless said...

I picked ze germans in fantasy...I don't know jack about the game, but that team has look strong from what I have seen, not that I really know the difference though, mainly they put the ball in the net.

spoonman said...

Ah, McF, I see. I'm hard at work, so can't keep up with all the posts, just a quick scan. I think I'm going to take a shot here.

arbitrage789 said...

McF @ 2:34

Just trying to keep boredom from setting in.

karen said...

see? told ya!

OIL FUTURES: Nymex Crude Up As US Equities Rally
2:37 PM ET | Dow Jones

McFearless said...

my limit order got filled...how awesome, my first trade since 6/28....gonna be a long summer.

Leftback said...

Germany has to get the ball to score. Xavi, Iniesta and Alonso are much better passers of the ball than the other teams Germany has played. Spain will try to control the tempo.

An early goal changes everything, however.

Thanks Karen, re: crude.

CV said...

Speaking of "I wonder why"...

Did you watch the OPTIONS MONSTER clip...

The guy was talking about REALIZED VIX...

Why are the number on the cash not matching up with VIX levels in a "realized" way for the past few weeks...

"I wonder why"

Nic said...

I am a swinger and happy to go both ways for a few days so no offence taken.

McFearless said...

I'm not saying we can rule out that H&S yet, but take a look at that huge H&S once this count-trend rally is over...however long it's going to take...still very much in play, and man is that almost perfect in every aspect, the only things that don't match over the entire decade was the volume a few of the years....everything esle is very much in tact and I've only seen 3 techs go into any detail about it..

It's andy's slide 3 on the most recent update.

Nic said...

74.15 is two equal swings off the low LB so it could very well pull back here.
I am going to try and hold my long for 75

McFearless said...

see, now Nic's 2:41, that was way dirtier than my original comment, hahaha

McFearless said...

cool site:

http://www.sentimentrader.com/

CV said...

Hoenig Says Fed Should Raise Key Interest Rate to 1%

http://noir.bloomberg.com/apps/news?pid=20601087&sid=aDkw7n4HFP7c&pos=6

July 7 (Bloomberg) -- Kansas City Federal Reserve Bank President Thomas Hoenig repeated his view the Fed should raise its target rate to 1 percent, even as some economic reports indicate the recovery is slowing.

---

Not that I disagree with TH, but Blackrock ought to get to putting some hedges back on that Maiden Lane portfolio if this is the case... LOL

arbitrage789 said...

McF,

As I said earlier, Nic and Karen have "immunity".

Doesn't apply to the boars, however.

CV said...

@McF

Did you read my post from earlier?

Here's what BRADLEY thinks...

http://forbestadvice.com/Money/Gurus/DonaldBradley/BradleyTurnDates2010.html

arbitrage789 said...

McF @ 2:46

How about if you get a subscription and then post the info using Google docs?

McFearless said...

peep this:

http://twitpic.com/2395lm


focus on volume...

Nic said...

Spanish players are definitely hotter than the German ones ...

McFearless said...

DL,

How come you don't want to pay for any services?

McFearless said...

C,

yeah, I only looked quick at the dates. What's his track record? And what makes up the Bradley siderograph?

CV said...

@McF

Because presently he's ALL IN on the rally...

In 2-3 weeks he'll be able to cash out his profits and pay the subscription price... :-)

arbitrage789 said...

McF @ 2:49

I've got a long list of monthly services paid for as it is. One has to draw the line somewhere.

CV said...

@McF

it goes back to the 1940's...

The guy was more of an "astrologer" type...

I'm not giving it much weight one way or another, but apparently the track record has been decent over the years...

More of a TIME thing (rather than levels)...

Apparently, REVERSALS take place on the dates... (counter to whatever trend happens to exist at the time)...

That's all

Leftback said...

Yeah, raising rates, like THAT's going to happen...

Karen are you still in the mood for shorts?
With it being so cold there this time of year....

McFearless said...

oh, btw, speaking of the solar eclipse on 7/11, the "18", 1098 figure, the possibility of a wave ii,

max pain is currently at 110 SPY

McFearless said...

DL,

if you don't mind...what do you subscribe to? Just wondering, I've got a few staples but I try a few new things each year, usually end up pitching most of them but I'm willing to look.

Leftback said...

DL doesn't want to give up his PLAYBEAR subscription.

arbitrage789 said...

McF @ 2:57

I actually don't have any subscriptions to any "financial advisory" services at present.

McFearless said...

you can feel ewi calling this a ii after the close today, but I'll know for sure by 6 pm...I think they go that route though.

if this is a ii it's going to be beneficial for a sentiment indicator to tune into some MSM the next week or so.

arbitrage789 said...

LB,

Funny.

karen said...

drv tagged 7.79 but i did not get filled.. last hour could get interesting.. might but order in for sds at 35.56 or so..

CV said...

@karen

Danny (TOPSTEP), mentioned 1052...

We tagged 1051.92

McFearless said...

DL,

Oh I understand, you don't have to say on the board you get Miniature Donkey Talk Magazine & Teen Beat ...it's all good man.

http://www.web-donkeys.com/images/uniflip/uniflip.swf

CV said...

CV's guess is that we're at 1032 by tomorrow and everyone will be back to scratching their heads (or other parts)...

Just a guess...

Leftback said...

Nic,

Who's your fave Spanish player? Xabi Alonso or David Villa?

CV said...

Hight Times, Guns & Ammo, & MAD Magazine...

Plus, of course... The SI swimsuit issue...

McFearless said...

oh, and if this is a ii.....lets not all get faked out by the b wave and think we are going down hard just in time for that C wave to shred us up and apply cold steel.

arbitrage789 said...

McF @ 3:04

"Miniature Donkey Talk Magazine & Teen Beat"

Yes, exactly.

arbitrage789 said...

SI swimsuit right here:

http://sportsillustrated.cnn.com/2010_swimsuit/

CV said...

@McF

That "B" is what takes back to 1032...

CV said...

Swimsuits bitchez! :-)

McFearless said...

C,

it certainly could get us to right around there yes, don't count this short term often though, as I've said before, so it's a coin flip really.

Leftback said...

LOL. Miniature Donkey Talk is for real... hilarious, Ben.

LB gets COLD STEEL magazine, International ROOSTER and FIXED INCOME CHRONICLE.

McFearless said...

I knew it DL!

I did a quick google for strange mags and that was the first one that came up....along with Girls and Corpses, which was a little too strange if you ask me.

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