Hello friends and fellow Capitalists (provided capitalism is still legal),
I'm going to skip doing a Scribd document this weekend due to time constraints. Will just "cut to the chase" here:
The S&P 500 had a pretty solid week, no doubt about it. I'm still counting the intial move down from 1345 as only the a-wave of a more enduring correction. Taking out the 1345 level would put that concept in the ol' trash can of "Wrong Counts." First and second levels of support in the week ahead would be 1319 and 1300. Bulls, or new longs, should consider those levels for various "stop loss strategies."
The Head and Shoulder concept that we've been talking about for more than a month now is still "in play." The chart below highlights the key support and resistance for that concept.
Silver continues to "congest" nearer the highs, which, in the short term, is NOT bearish at all. My short term "bet" would be for more "triangular-ish" price action this week. First and second levels of support would be $36.87 and $36.41. Obvious resistance lies at $38.16, which was the previous "high" for this move. Bigger picture, I would still point back to last weeks Monthly chart--Silver is still in the zone of MAJOR longer resistance. So, the bottom line is: Be really nimble...go ahead and get long for that next little blast higher (if you want), but don't get too greedy with those profits.
Just another look at Gold in the "bigger picture." No real changes here as the "yellow metal" remains in a longer term bullish trend. Highlighted on this chart are critical longer term support levels.
~~~~~~~~~~~
Some NCAA Tournament Thoughts:
The deeper and more physically fit teams "survived" those Semi-Finals. The failure of Kentucky to get their "game legs" under themselves down the stretch was the difference.
Not sure why VCU kept with the Full Court pressure AFTER Butler had figured out how to "crack" the pressure. The end result was that the VCU players seemed more tired in the second half. That fatigue showed on several occasion as the VCU "bigs" couldn't get the "close looks" at the hoop to fall.
I LOVE the underdog story and will be rooting for the Butler Bulldogs Monday Night. If they can keep playing that stingy defense and if Matt Howard can knock down some shots (he missed a TON against VCU), then the Bulldogs have a legitimate shot.
It should be a fanstastic game if you like "Guard" play. The game features the two best "CLUTCH" guards in the tournament in Kemba Walker and Shelvin Mack. Those guys were both unreal on Saturday Night, hitting very difficult shots with men "in their face."
Best of Luck to everyone in the week ahead!
@wunsacon from last post:
ReplyDeleteNo, I suppose that could be done for tertiary providers, but if it came down to that I'd just get large the market again...
New weekly 3LB highs/lows:
ReplyDeleteDJ Trans Avg - high
SLV - high
WTI - high
EURUSD - high
CAT - high
BIDU - high
XRT - high
Weekly 3LB reversals:
AUDJPY - up
MSCI - up
KOSPI - up
ATHENS - down
The US recovery is little more than an economic 'sugar-rush'
ReplyDeletequote:
"Global investors are increasingly wondering what happens when the money printing stops and those debt service costs rise. More and more interest is being shown in the fact that America’s total sovereign liabilities, including off-balance sheet items such as Medicare and Medicaid, amount to $75,000bn – no less than five times’ annual GDP.
It is against this backdrop that the Obama administration and Republicans in the House of Representatives are now arguing over miniscule $30bn spending “cuts” – a row so vociferous that it could see the US government “shut down” at the end of this week, leaving government contracts unserviced and state employees unpaid. This would do serious damage to America’s image as a credible borrower, focusing more attention on its fiscal weakness and its financial vulnerability when the money printing stops.
So beware of the siren voices claiming that shares on Wall Street will keep rising. Beware of anyone who is so deluded that they point to surging oil prices as “evidence” that the US - the world’s biggest oil importer by far, of course - is “fit and healthy” and “ready to rock”. Yet that was the cry among many Wall Street denizens last week. “Oil is rising – we are saved!” I paraphrase, but not a lot."
Ok I'll admit I'm watching The Borgias...
ReplyDeleteWas out on the town tonight...had a good customer in from "other parts".....
ReplyDeleteWe took some people to Morton's Steakhouse downtown Houston. To be honest, one of the reasons we picked Mortons was because a few other places were totally "booked."
So, while hanging out around 6PM, we see Kareem Abdul-Jabbar, Dennis Rodman, Chris Mullen, and Roy Williams (coach of the North Carolina TarHeels) walk in....
We were in the "right spot" this night.
Dennis Rodman wears a Boa no matter what's going on...TV cameras or no TV cameras.
Weird.
Good Eats at Mortons...can recommend.
I see the AH weakness has been checked. Will weakness ever carry over to the cash open?
ReplyDeleteGood morning everyone! I'm back from the week-long floating food fest. All in all, it was a good week. My mother enjoyed her birthday, my daughters found true love (boy magnets at ages 7 and 9?!?!?!), and my son didn't fall overboard (note the high expectations here). We swam with stingrays and didn't get stung, we hiked in the Honduran jungle without bug spray and didn't get bitten (although a giant macaw ate a button off my husband's shirt -- Brooks Brothers isn't a good choice for jungle attire!), we swam with dolphins in Mexico and only had our credit card stolen (they bought groceries at a Food Lion in Rocky Mount, NC -- weird, huh?) We flew Southwest and lived. Unfortunately, it is not possible for our family to travel without some sort of mishap. I was hoping that having the credit card # stolen was enough...but sadly, the cat my husband and I adopted together the Christmas before we got married (12 years ago now) died while we were away. So, I have to deal with an upset cat-sitter, an angry vet (we were hard to reach and they needed family authorization to euthanize) and some pretty sad kids today. Thanks for the charts, Andy. I'll be back later or tomorrow.
ReplyDelete@Andy
ReplyDeleteThanks for the charts!
Mortons is one of my favorites...
AUDJPY, EURJPY are down but DXY is down also. Gold and silver still pushing higher. C'mon bears. Stop hibernating. Or did they shoot you with a tranquilizer?
ReplyDeleteMy data feed is back. They had some weekend maintenance work and some accounts needed to be reset. Go figure.
ReplyDeleteNo one watching the markets?
ReplyDeleteWell, spent the weekend OOT...but bought a little more UPRO BTB this am...
ReplyDelete...Until they make me stop...
the weather here today is about to get ugly in East Tennessee...
Amen:
ReplyDeleteI don't have the slightest doubt we collapse sometime in the future...not the slightest.
But until then, I will follow Macke's crayon and Uncle Tepper's advice....
As usual, we are busy in the mine this morning, or I would comment more...
ReplyDeletehttp://www.bloomberg.com/news/2011-04-03/fed-answering-brazil-china-germany-axis-over-qe2-with-u-s-growth-restored.html
ReplyDeleteFed Answers Brazil-China-Germany Axis With U.S. Growth
"Concerns that U.S. inflation would surge and foreign investors would shun dollar-denominated assets haven’t materialized."
...?
..I suppose if you aren't eating or moving, that might be considered true. The CPI in Europe's best managed country, Germany, is up at a 6% YOY rate...actually nearly all the countries that matter are now having significant inflation.
http://www.rttnews.com/CorpInfo/EconomicCalendar.aspx
We have been buying CIM this morning. Big yield on sale here. Update on bonds later. Goldie downgraded GDP today, guess they were long Tsys... they certainly triggered my stops on TBT.
ReplyDeleteWe made massive $ while doing nothing on our vacation. There is a lesson there i suppose..
We have been very long. We were lucky to have cash at the time of the Japanese event and have done very well. Lucky lucky boy.
61% long equities (30% divvys, 21% SPY, 5% QQQQ, 5% EWJ).
15% bonds (9% JNK, 3% AGG, 3% TLT)
Monthly results 2011, Jan +2.8%, Feb +3.0%, Mar +2.9%.
No, we are not Madoff or a relative, just lucky, and nimble.
We need to reduce risk.... and hedge our JPY exposure....
CIM trading at P/E 5.8 and yield of 16.7%.... there are worse deals. The idea that REITs will be slaughtered by massive rate rises sending 30y mtg rates to the moon is idiotic. Fill yer boots is what we say !
ReplyDeleteMost of the recovery is priced in the long end, it's the short end that might be more of a concern for punters.
I SPY Apple stock down again while the S&P 500 is up a smidge.
ReplyDeleteThere's a "disturbance in the force."
CIM cut its dividend from 18 cents to 14 cents March 21?
ReplyDeleteLearned something interesting about banks and hedges...
ReplyDeleteIf a bank takes down, let's say 1mm bbls of Cal-15 crude, and they want to hedge it by selling Cal-12, they discount the Cal-15 in "net present value" fashion. So, instead of selling 1mm bbls of Cal-12, they might only sell 950,000 bbls in Cal-12...something like that.
It struck me as odd, but I'm told that's the way all the banks "value" their forward crude and natty exposure.
So, "if" rates do rise, you will see A LOT of buying down the curve in either natty or CL. A LOT.
Bruce
ReplyDeleteLook at the MBB chart and you'll see why Q4 was bad for mortgage REITs. That was a one-time spike in yields...
LB
PM fans will find this of interest:
ReplyDeletehttp://news.yahoo.com/s/ap/us_liberty_dollars_raid
Short term top dead ahead for the PMs?
Charlie Sheen has apparently "peaked"...
ReplyDeletehttp://www.myfoxdetroit.com/dpp/news/charlie-sheen-live-show-gets-torpedoed-in-detroit_04022011_dk
WTI appears to be making an evening star formation. But recent past experience has told us how reversal patterns get crushed.
ReplyDeleteLeftback
ReplyDeleteAre you sure there won't be any massive long bond rate rises?
I took some more profits today. I am in the process of reigning in my risk position from about 60 percent to 40 percent (about half way there at the moment).
ReplyDelete@AmenRa:
ReplyDeleteWhat do you mean by massive?
The yield curve is still historically steep, even if it has come in a little bit in recent weeks. I think the front end is acting like a tether on the long end.
In my opinion, we would need to see at least moderate increases in the front end before there can be any kind of significant selling pressure in the longs. This seems unlikely given the tepid growth and high unemployment.
I would be curious to hear other opinions on the curve going forward.
Recoveryless recovery? Not for these people...
ReplyDeletehttp://finance.yahoo.com/real-estate/article/112472/where-rich-moving-cnbc;_ylt=AhjckdX1u8FqbBwHBtzi5QS7YWsA;_ylu=X3oDMTFhOTdqbXZxBHBvcwMzBHNlYwNwZXJzb25hbEZpbmFuY2UEc2xrA3doZXJldGhlcmljaA--?mod=realestate-buy
Matthew
ReplyDeleteI am with you, almost exactly.
Risk, about 60%, feels a bit heavy.
Long end. Going nowhere.
Short end. Risky business. No need to play there.
Curve, max 2s30s is 400 bps or so. minimum 250 bps.
Oscillate, rinse and repeat....
Short end good for "parking" cash, 2-3 weeks. That's all.
ReplyDeleteRa,
ReplyDeleteAre you sure there won't be any massive long bond rate rises?
YES. Unless you are Japanese....
zzzzzzzzzzzzzzzzzzzzzzzz...................................
ReplyDeleteFixxy,
ReplyDeleteit's funny that you brought up CIM ..
I was looking at that, last week, thinking ~"hmm, that's odd, I wonder what LB thinks about that.."
given this Chart..
http://finviz.com/quote.ashx?t=CIM&ty=c&ta=0&p=w
are you 'worried', at all, that there's been a 'trend change'?
AAIP
Where is Karen? Ben? I-Man?
ReplyDeleteNot really. The Q4 was difficult b/c of the quantum move up in yields after the QE2 announcement, and it's hard to hedge that properly. Most of these high divvy stocks trade down when they are ex-dividend, and are sleepers for a while. But stable low rates will be good for this one. You know my views on housing and mortgage rates....
ReplyDeleteJust got back. I see I didn't miss much in the markets. LB & Matthew: who will buy the long bond after June?
ReplyDeleteRa: Same as it ever was...
ReplyDeleteChina. UK.
Pension funds and investors fleeing commodities, industrials, tech, retail, emerging markups, munis and junk bonds.
Banks. Tier 1 Capital, innit...?
NEXT.... (don't be long emerging markups or short long bonds in May, please, LB cares about your welfare. Especially if you wear red heels....)
Fans of the long bond will be interested to know the POMO is 10s tomorrow and 30s on Wednesday, after that you can get short into the April 13-14 auctions... your humble servant...
LB
Fixxy,
ReplyDeleteI hear ya, looks like ex-div was 29 March..
what do you think about Fading the May 4put?
AAIP
JNK, HYG, LQD, TIP, IQI, MUB, AGG all higher.
ReplyDeleteDXY, GOLD, SILVER, WTI all higher.
AUDJPY, EURJPY, AAPL, BKX, XLF all lower.
You decide.
AAIP
ReplyDeleteFade the May 4 put. Fade it, and buy June calls.
CIM rallied. LB moves markets again....
ReplyDeleteLB,
ReplyDeletelooks like that can be done with a 'Credit' ..
I'll shoot that over to the Margin Clerk..
ibid.
Woo hoo! I've got some National Semiconductor in a small IRA account somewhere...a failed experiment with some "reconvert" that busted and I got the stock. Texas Instruments buying it for $25/share.
ReplyDeleteAs AAIP would say... always be selling....
ReplyDeleteAnother good day. The sun is shining on Bananamerica. Or is that a reflection of the moon off BB's arse?
The idea that the treasury market will implode at the end of QE2 is so misguided as to be akin to looking down a microscope using the objective as the eyepiece.
ReplyDeleteSomething is going to have a clavadista at the end of QE2 and it isn't Treasuries. One shouldn't blithely assume that any asset can go up indefinitely.....
I would not want to own junk bonds, miners or PMs in June. Treasuries not a problem. Get 'em while they are cold... next two auctions, fill yer boots.
Look at AA, it has that "sell the news" profile....
ReplyDeletehttp://finance.yahoo.com/q/bc?s=AA+Basic+Chart&t=3m
The Street has already chased it up. This earnings season may be a little bit different. Margin compression?
J-
ReplyDeleteTI is getting a Steal on NatSemi..
almost as good as the deal ORCL was gifted w/ Sun ..
AAIP