SPX Bearish long day (opening marubozu). Confirmed evening star pattern. Stayed above the 1.786 fibo (using low) of 1190.89 (next is the 1.8276 at 1218.63). Midpoint above 10 SMA (uptrend still intact). Daily 3LB reversal (down) with reversal now 1211.67. QE2infinity.
DXY Bullish spinning top day. Closed below 21 SMA and 10 SMA. Closed back above the 55 SMA (go figure). Midpoint below 10 SMA. No daily 3LB changes. Now trading back above the weekly 3LB reversal at 80.44.
VIX Bullish LONG day. Traders needed new underwear after today. Blew through the 61.8% fibo ext (support). Midpoint is well above 10 SMA. Five days of indecision...decided. Daily 3LB reversal (up) with reversal now 15.58.
GOLD Bearish long day. Still above all SMA's. Tested the 14.6% and 38.2% fibo ext. Failed both. Daily 3LB reversal (down) with reversal now 1161.60.
EURUSD Bearish short day. Midpoint above the 10 SMA. Closed below the 55 SMA. Next fibo level of 1.2935 is still a target in case of weakness (don't worry it's coming...yup yup). Daily 3LB reversal (down) with reversal now 1.3658.
We're getting VERY CLOSE to the "kill zone" that I'd identified on my post of April 7th...
Reprint of APRIL 6th Chart.
Today's open market trading will be DAY 49. Remember also, that the 'correction' in January began in EARNEST on the Tuesday after OPEX WEEK. Today is is an OPEX Friday.
Some say history doesn't repeat itself, but it RHYMES...
A blast from the past.
The P2 "rally" wave (after the Stock Market crash in October, 1929 lasted until April 16th, 1930). So HAPPY 80th Birthday!
Is It April 1930 All Over Again?
That last leg up to the very top in April 1930 took on a similar slow-motion grind like the recent one. From the top in April 1930, investors and traders experienced 27 months of hell as the Dow completely collapsed until it finally hit the bottom in July 1932.
What’s interesting is the DJIA had several failed rallies (+19.3%, +27%, +31%, +39%, and +28%) on its way to falling 86% from that 1930 top.
If the DJIA continues to repeat the 1929-32 sequence of market events, we’re talking about a Dow Jones Industrial Average of 1500 somewhere in 2012.
The first loss of 7729 points on the DJIA from October 2007 to March 2009 will look like an absolute picnic if this final down leg in fact materializes. The good news? From 1929-32 there were several mini bull market moves mixed in with that 86% decline.
But everyone KNOWS that will never happen again, right? And even if it does, everything will be fine and dandy in the world, and you can just sit there all the while in front of your trading platform with a slice of pizza in your hand, and a 2 litre bottle of coke by your side...
I expect to see a lot of George Soros types running around within 27 months from now. Let's all exchange e-mails so we can all buy property together in the Hamptons for when that day arrives!
SPX Bullish spinning top day. Could be start of an evening star pattern (third day needs to gap lower). Stayed above the 1.786 fibo (using low) of 1190.89 (next is the 1.8276 at 1218.63). Midpoint above 10 SMA. New high on daily 3LB with reversal now 1196.48. QE2infinity.
DXY Bullish short day. Closed below 21 SMA. Closed below the 55 SMA. Midpoint below 10 SMA. No daily 3LB changes. Now trading back above the weekly 3LB reversal at 80.44.
VIX Bullish doji day. Still showing traders are not fearful. Did not test the 61.8% fibo ext (support). Midpoint of candle is below 10 SMA. Five days of indecision. Weird. No daily 3LB changes.
GOLD Hanging man day. Still above all SMA's. Tested the 38.2% fibo ext and passed (barely). No daily 3LB changes.
EURUSD Bearish long day. Midpoint above the 10 SMA. Closed below the 55 SMA. Next fibo level of 1.2935 is still a target in case of weakness (don't worry it's coming). No daily 3LB changes.
GOOG Bullish spinning top day. Negated evening star. Held the 61.8% fibo ext. Tested the 85.4% fibo ext and failed. New high on daily 3LB with reversal now 576.45. *Currently getting killed in after hours post earnings.
The Bond Report 4.15.10 (courtesy of LB)
Another solid day across the board in the fixed income universe. HY outperformed IG and TIPS > vanilla Ts. Interesting to see a steady flow of money into bonds with the equity market flying so high.... JNK is just about to complete a "double top".... hmm....
We did nothing. So far this week, our not trading has correlated with our not losing any money... we are clearly geniuses at Schadenfreude Asset Mgmt. "If you don't know what to do, do nothing.."
"Or, even if you DID SOMETHING, say you KNOW NOTHING"
In my 'speechless' mesmerized condition (with regards to the 'levity' of equity markets), I offer only an AUDIO-VISUAL representation of CV's STATE OF MIND... Note: the markets are likely, AS EVER, to be totally absurd and un-tradeable, so you might as well just entertain yourselves all day with my offerings...
First, the usual...
Now... "Let me tell you how it will be... One for you 19 for me"...
Which is APT... As 'soon' we will all be singing this song... (you don't know how LUCKY you are)
Pissed? Needn't be... Just sing THIS to cheer yourself up... ("brah" to you I-Man - Life goes on)
But if your name is "TIGER", you're thinking more along these lines...
Whatever you do... EVERYONE... Just remember the following... Despite the INEVITABILITY that "These [aforementioned] birds will have FLOWN", someday... Simply remember, in the end... YOU'LL NEVER WALK ALONE!
"Hold your head up high, And don't be afraid of the dark. At the end of a storm, There's a golden sky, And the sweet silver song of a lark. Walk on through the wind, Walk on through the rain, Though your dreams be tossed and blown... Walk on, walk on, with hope in your heart, And you'll never walk alone... You'll never walk alone. Walk on, walk on, with hope in your heart, And you'll never walk alone..." You'll never walk alone...
Here... I'll help you SING it! (in a way that some of the lads from above would)...
A couple of things have been on my mind the past couple of days... Most of it has to do with "telltale" indicators (such as VIX), and "one trade" indicators (such as DXY)...
I'll start with the VIX... Last week, I put up some charts showing that the VIX had "pierced" the lower BB's on DAILY CHARTS (and was close to doing that on WEEKLY charts as well)... This has been a precursor to "market corrections" in the recent past... I'll put those charts up again...
VIX WEEKLY
VIX DAILY
What strikes me most are two things. Not simply the BB aspects, but the relationship to "peaks" & "troughs" to the number 55 (a fibonacci number)...
There are dozens of "overbought" signals that have begun to flash recently, but that, to me, is the most compelling (and perhaps one of the MAIN reasons why this latest period seems to defy logic and seems to be MGUF)...
Another thing that has been bothering me are all the calls for DOLLAR CORRECTION... Last year, it was the "one trade" meme (DGDF & SPXGUF)... Why does that seem to be broken now? Or is it? Applying the same "55" logic to the DXY, here's the chart I came up with...
The DXY is now sitting on it's 55MA (and has not "closed" under it just yet)... This probably means one of two simple things...
- It's going to break down - The 55MA will act as SUPPORT for yet another dollar wave
"One foot on the pedal, and one on the brakes"... Can YOU drive 55?
Everybody knows the story - It's DAYS away - (or hours -or minutes). Please hang around... Oh Yeah!
SURVIVOR CAPITAL MOTTO
I won't let you down I will not give you up Gotta have some faith in the sound It's the one good thing that I've... got I won't let you down So please don't give me up Cause I would really, really love to stick around
OH YEAH!
Heaven knows I was just a young boy Didn't know what I wanted to be I was every little hungry schoolgirl's pride and joy And I guess it was enough for me To win the race? A prettier face! Brand new clothes and a big fat place On your rock and roll TV But today the way I play the game is not the same No way Think I'm gonna get myself happy...
I think there's something you should know I think it's time I told you so There's something deep inside of me There's someone else I've got to be Take back your picture in a frame Take back your singing in the rain I just hope you understand Sometimes the clothes do not make the man...
All we have to do now Is take these lies and make them true somehow All we have to see Is that I don't belong to you And you don't belong to me FREEDOM You've gotta give for what you take FREEDOM You've gotta give for what you take
Heaven knows we sure had some fun boy What a kick just a buddy and me We had every big shot good-time band on the run boy We were living in a fantasy We won the race Got out of the place I went back home got a brand new face For the boys on MTV But today the way I play the game has got to change Oh yeah Now I'm gonna get myself happy I think there's something you should know I THINK IT'S TIME I STOPPED THE SHOW There's something deep inside of me There's someone I forgot to be Take back your picture in a frame Don't think that I'll be back again I just hope you understand Sometimes the clothes do not make the man...
All we have to do now Is take these lies and make them true somehow All we have to see Is that I don't belong to you And you don't belong to me FREEDOM You've gotta give for what you take FREEDOM You've gotta give for what you take
Well it looks like the road to heaven But it feels like the road to hell When I knew which side my bread was buttered I took the knife as well Posing for another picture Everybody's got to sell But when you shake your ass They notice fast And some mistakes were built to last...
That's what they get... I say that's what they get... That's what they get for changing your mind...
And after all this time
I just hope you understand Sometimes the clothes Do not make the man I'll hold on to my freedom
May not be what you want from me Just the way it's got to be Lose the face now I've got to live...
--- SPECIAL THANKS to Cindy (Crawford), Linda (Evangelista), Naomi (Campbell), Christy (Turlington), and Tatiana (Patitz) for their help in this narrative...
In football, an "audible" is where the quarterback comes to the line of scrimmage, surveys the defense, and may decide in that moment to "audible" to an alternative play selection if he feels either that the play that was called would not be a successful one (because it appears to be properly defensed, or, if a different play might expose some weakness. Basically, when you see Peyton Manning flapping his arms around like Morris Day doing "The Bird", you know an audible is coming.
It appears that nevermore in the history of the New York Stock Exchange will an audible be required. The playbook is simple. Cover all shorts on Friday. Sleep happy and long over the weekends, and you'll wake up Monday, and be "magically" richer by owning stocks. It's really that easy folks!
So I'm not going to offer any more insights here. I'm going to K-I-S-S. Buy stocks, they go up forever! They don't even decline by 1%. If they ever do go down by 1%. Beg, borrow, and steal (kind of the way our world governments do things).
Illustration?
Greece, over the weekend. (They're the "beg" & "borrowers" - or, should I say, "first in line to do such"). But read the fine print people. Here's what was actually said. "This decision today was no decision on aid for Greece," Finance Minstry spokesman Michael Offer told Dow Jones Newswires. "But it was only about technical preconditions for aid by further specifying the decision of the heads of state and governments. We expect, we hope that Greece is now in a situation where it can continue to refinance itself on the capital markets, as previously."
What CV reads is that there was NO DECISION (until certain criteria were met). Doesn't matter... It's a reason to buy Euros, sell Dollars, and pump the S&P (while everyone was distracted watching golf - congrats Phil!).
Andy T has again given us his "technical" view on the matter. The following is a reprint of his Sunday afternoon thread (which I will make a habit of featuring as the Monday morning thread). Andy's charts offer a "calmer" picture of potential levels (and possibly durations of data points that get processed through the meat grinder which are the capital markets). Good luck people!
Lastly, CV would REALLY like to express his congrats and best wishes for Phil & Amy Mickleson and family. It was a great moment in what has been a difficult period!
---
By Andy T (April 11, 2010)
One of the very interesting developments the last several weeks has been the correlation between the Dollar and the stock market. Unlike most of last year when the DXY and the stocks/commodities were "inversely" correlated, that relationship has been broken. Basically, the "Peter Schiff/Jesse's Cafe Americain" crowd that was predicting both doom and gloom for the U.S. Dollar and the stocks have been wrong on both markets. While the Dollar strength was predictable and anticipated using technical analysis and sentiment, the associated rally in stocks and commodities has certainly been a surprise to me. It will be interesting to see how the stock market now reacts to any Dollar weakness....
This weekend's thoughts were dedicated to the DXY which has achieved all of the price and duration targets we had been expecting. It's probably time for longer term investors to take a few chips off the table. I would not advocate completely exiting long positions, but there is a decent chance of decline back to 78, giving us better levels to buy back in for the next phase of this bull market. The risk is that my count is incorrect and the market will just keep on chugging higher. For this reason, it would be prudent for longer term traders/investors to stay at least a little bit long (maybe 25-33% of a max long position?).
Traders who want to short this market should use 81.91 as a "stop loss." Alternatively, those who want to stay long this market should use 79.50 as "stop loss." That 79.50 has been good support for awhile now, hasn't it?
I don't have a report on the S&P because there's not much new here from last week. The market has not yet "peaked" and seems destined to print a 1200 handle. Short term support for the S&P futures is now 1183 and 1171. So, it won't make sense to bail on length or initiate shorts until 1171 is taken out on the futures.
Hope everyone had an enjoyable weekend. Good luck in the week ahead.
One of the very interesting developments the last several weeks has been the correlation between the Dollar and the stock market. Unlike most of last year when the DXY and the stocks/commodities were "inversely" correlated, that relationship has been broken. Basically, the "Peter Schiff/Jesse's Cafe Americain" crowd that was predicting both doom and gloom for the U.S. Dollar and the stocks have been wrong on both markets. While the Dollar strength was predictable and anticipated using technical analysis and sentiment, the associated rally in stocks and commodities has certainly been a surprise to me. It will be interesting to see how the stock market now reacts to any Dollar weakness....
This weekend's thoughts were dedicated to the DXY which has achieved all of the price and duration targets we had been expecting. It's probably time for longer term investors to take a few chips off the table. I would not advocate completely exiting long positions, but there is a decent chance of decline back to 78, giving us better levels to buy back in for the next phase of this bull market. The risk is that my count is incorrect and the market will just keep on chugging higher. For this reason, it would be prudent for longer term traders/investors to stay at least a little bit long (maybe 25-33% of a max long position?).
Traders who want to short this market should use 81.91 as a "stop loss." Alternatively, those who want to stay long this market should use 79.50 as "stop loss." That 79.50 has been good support for awhile now, hasn't it?
I don't have a report on the S&P because there's not much new here from last week. The market has not yet "peaked" and seems destined to print a 1200 handle. Short term support for the S&P futures is now 1183 and 1171. So, it won't make sense to bail on length or initiate shorts until 1171 is taken out on the futures.
Hope everyone had an enjoyable weekend. Good luck in the week ahead.
This blog should not be interpreted as investment advice of any kind.The authors are NOT representing themselves CTAs or CFAs or Investment/Trading Advisor of any kind.The authors may or may not trade in the markets discussed.The authors may hold positions opposite of what may by inferred by this blog.The information contained in this blog is taken from sources the authors believes to be reliable, but it is not guaranteed by the authors as to the accuracy or completeness thereof and is presented here for information purposes only. Commodity trading involves risk and is not for everyone.
Fictional Character Quote of the Day:
I guess it comes down to a simple choice. Get busy living or get busy dying.
- Andy Dufresne
"The Shawshank Redemption"
About this Blog
This Blog's primary focus is on trading based upon technical analysis. It is run by "AmenRa" and "AndyT," quasi-anonymous traders who employ technical analysis to assess market conditions and trading opportunities. AmenRa utilizes 3LB techniques, Moving Averages and Fibonacci sequences. AndyT's analysis relies primarily on "Wave Theory" and Fibonacci sequences. The Comments Section is uncensored and open to the public. Please try and adhere to the "Blogger Policy."
SPX
DXY
VIX
GOLD
EURUSD
