Morning Corner 2.25.11

New Highs New Lows






Even though the SPX and Dow closed lower there were more new highs than new lows. That might more to do with the late push in the afternoon. Dip buyers? Knife catchers? Nothing wrong with trying to fake the bullish case…not that there is anything wrong with that ;-)



Comparative Currency Performance






From 2007 (pre GFC) to present. Obviously Gold (+101.48%) has outperformed all fiat currencies. Hard to believe the Yen (+43.66%) is doing better than the Swiss Franc (+32.12%). The laggard is DXY (-8.90%).



90 Day Treasury






From what I see here the Fed will not be raising rates anytime soon. ZIRP forever.

I've uncovered an unknown Nostradamus document. It said the identities of those pictured are The Fed, Bank of England, ECB and IMF.

AmenRa's Corner

A place where a skillful caddy always offers cool contemplation when it comes to your "stick" selection.

Creditcane™: Who threw paint on the masterpiece I was creating?

SPX
Spinning top day. Midpoint below EMA(10). Still below SMA(21). Tested and held the 23.% retrace (1303.70). New low on daily 3LB (reversal is 1340.43). Now trending down on daily 3LB. QE2infinity. JBTFD?…



DXY
Spinning top day. Midpoint below EMA(10). Further below the 14.6% retrace (77.54). Below all SMA's. New low on daily 3LB (reversal is 78.46). Below weekly 3LB mid.



VIX
Dark cloud cover day. Midpoint above EMA(10). Above all SMA's. No daily 3LB changes (reversal is 15.81). Back in the "fear" zone. Currently does not have a monthly 3LB reversal.



GOLD
Bearish harami day. Midpoint above EMA(10). 0.0% retrace holding. Still above all SMA's. No daily 3LB changes (reversal is 1385.10). Back below upper trendline. Must have the precious.



EURUSD
Bullish short day. Midpoint above EMA(10). Still above 1.3506 (the 50% retrace). Above all SMA's. Closed above 1.3782 (fibo .09). New high on daily 3LB (reversal is 1.3534).



JNK
Spinning top day. Midpoint below EMA(10). Failed SMA(21). Back below its 50.0% retrace (40.47). Also still below lower trend line. No daily 3LB changes (reversal is 40.34).



IQI
Bullish short day. Midpoint below EMA(10). Still below all SMA's. Above its 23.6% retrace (11.68). No daily 3LB changes (reversal is 12.30). Closed at its weekly 3LB mid (11.76).



10YR YIELD
Spinning top day (failed to confirm bullish harami). No test of 0.0% retrace at 37.44. Held SMA(55). Midpoint below EMA(10). New low on daily 3LB (reversal is 37.25).



DJ TRANS AVG
Bullish thrusting day. Still below SMA(89). Midpoint below EMA(10). No daily 3LB changes (reversal is 5298.10).




TLT
Spinning top day. Midpoint above EMA(10). Now above SMA(55). Above lower trend line. New high on daily 3LB (reversal is 89.92). Currently does not have a monthly 3LB reversal (down).



WTI
Dark cloud cover day. Still above all SMA's. Midpoint above EMA(10). Closed back below the 23.6% retrace (96.95). No daily 3LB changes (reversal is 87.66).



SILVER
Bearish engulfing day. Still above all SMA's. Midpoint above EMA(10). No test of 0.0% retrace. Couldn't hold upper trendline. No daily 3LB changes (reversal is 31.58). Blythe brought out the big guns.

LEFTBACK'S BOND REPORT

The Bond Report 2.24.11

Another solid day of consolidation in US fixed income markets. HY was flat, IG had a modest bit but investors were still keen to flee to the safety of Treasuries.

Munis have had a good week, and so have mortgages, as at least the "rate risk" has been squeezed out of munis for now.

EM bonds are steady but variable. Remember that Chinese and Indian markets are struggling but Russia and Brazil are fine for now.

The curve has flattened a bit, 2s10s now at 282 bps, 2s30s at 381 bps, and as we pointed out 10s30s had to come in from where it was. So those who dig the long bond have had a good week.

Corpies: LQD 0.11%; AGG 0.02%; JNK -0.01%; HYG 0.08%
Govies: TLT 0.64%; IEI 0.04%; TIP 0.36%
Munis: IQI 1.28%; MUB 0.51%
Mortgages: MBB 0.27%
Specialty: ZROZ 1.90%; TBT -1.20%; EMB 0.11

We did nothing, we had a very small hedge on and got stopped out. That's telling us not to hedge for now. We started a EURUSD short today and we were bottom fishing for NZT as our falling knife. Sticking with about 39% fixed income.

AGG 15%, TLT 10%, JNK 9% LQD 5%.
Equity longs (all divs) 16.5%
Short EURUSD 7%

Morning Corner 2.24.11

ES (daily info)
new low 1305.50
trend=no
direction=down (2 bars)
low= 1305.50
rev= 1342.50; mid= 1324.00


ES daily candle doesn't look like a reversal. This could be a morning star starting to form but we're not really in a downtrend…yet. But failing to close above the weekly 3LB mid continues to indicate weakness. The new candle forming isn't screaming strength.



Swiss Franc (monthly info)
no change (above mid)
trend=no
direction=up (2 bars)
high= 1.0714
rev= 0.8360; mid= 0.9537


Now at all time highs. Intervention failed last year. Not sure what they may have to do to get CHF lower. The more Europe implodes the higher it will go. Last month formed a bearish harami but that will not get confirmed. Currently the month may close higher and will begin trending up on the monthly 3LB.

Get your mind right before the absurdity of the market drives you insane...

AmenRa's Corner

A place where a skillful caddy always offers cool contemplation when it comes to your "stick" selection.

Creditcane™: My masterpiece revisited.

SPX
Bearish short day. Midpoint below EMA(10). Back below SMA(21). Obviously no test of 0.0% retrace. New low on daily 3LB (reversal is 1343.01). QE2infinity. JBTFD?…



DXY
Bearish long day. Midpoint below EMA(10). Now below the 14.6% retrace (77.54). Still below SMA(21). New low on daily 3LB (reversal is 78.61). Below weekly 3LB mid.



VIX
Bullish long day. Midpoint above EMA(10). Above all SMA's. New high on daily 3LB (reversal is 15.81). Back in the "fear" zone. Currently does not have a monthly 3LB reversal.



GOLD
Bullish long day. Midpoint above EMA(10). 0.0% retrace holding. Still above all SMA's. New high on daily 3LB (reversal is 1385.10). Above upper trendline. Must have the precious.



EEM
Homing pigeon day. Midpoint below EMA(10). Still below all SMA's. Failed its 38.2% retrace (45.06). No daily 3LB changes (reversal is 46.48).



JNK
Spinning top day. Midpoint below EMA(10). Held SMA(21). Back above its 50.0% retrace (40.47). Also still below lower trend line. No daily 3LB changes (reversal is 40.34).



IQI
Bullish long day. Midpoint below EMA(10). Still below all SMA's. Passed its 23.6% retrace (11.68). No daily 3LB changes (reversal is 12.30). Still below its weekly 3LB mid (11.76).



10YR YIELD
Bullish harami day. No test of 0.0% retrace at 37.44. Still below SMA(21). Midpoint below EMA(10). No daily 3LB changes (reversal is 37.25).



CRB
Bullish long day. Midpoint above EMA(10). Above all SMA's. No test of 0.0% retrace. New high on daily 3LB (reversal is 342.17).




XLF
Spinning top day. Midpoint below EMA(10). Still below SMA(21). No test of 0.0% retrace. Tested and held the 23.6% retrace (16.53). New low on daily 3LB (reversal is 17.18).



TLT
Doji day. Midpoint above EMA(10). Still above SMA(21). Not testing lower trend line. New high on daily 3LB (reversal is 88.45). Currently does not have a monthly 3LB reversal (down).



SILVER
Bullish long day. Still above all SMA's. Midpoint above EMA(10). No test of 0.0% retrace. New high on daily 3LB (reversal is 31.58). Blythe?!? Blythe?!? RU OK?

Morning Corner 2.23.11

Silver (weekly info)
new high 32.30
trend=up
high= 32.30
rev= 29.27; mid= 30.79



Weekly candle could form a shooting star. From how it looks now it would have to close near the lows. The reason is that a shooting star with a red body is more bearish than one with a green body. But shooting stars are not the best reversal candles. A hanging man w/ a red body (too late for this), a dark cloud cover (still possible) or bearish engulfing (still possible) usually give better results.



Wheat (weekly info)
no change (below mid)
trend=up
high= 973.00
rev= 900.00; mid= 936.50



Foods made from wheat should start getting less expensive. At least it offsets the increase in gas prices. Today wheat closed below its weekly 3LB reversal price (there's still W-Th-F) and if it continues then the monthly 3LB mid is the next level of support. Support becomes the 38.2% retrace at 796.58 if that fails.

Mad skills...