Wednesday, August 16, 2006

What a Drag..........

Dear Readers,

I gotta level with ya, it is not fun to write this blog in this kind of environment. Another nearly triple-point rise today. Ugh. I notice the comments section has gone stark, raving mad - nearly 200 comments. If the market had been slammed today, I'd love to go check out the comments. As it is now, I'd rather not see what people are saying!

Well, as has been pointed out by readers before, there is no right or wrong in the market. There is simply the market. It seems hard to believe that less than a month ago (July 18th) we were flirting with breaking Dow 10,660 and heading into a major descent. Seems like a million years ago, doesn't it? Sad. My only hope is that my emotions tend to inversely correlate to the bearish prospects of the market. I'm feeling like crap, so maybe we're at a turning point, eh? Or maybe not.

The $INDU has risen to the point where it's become very demoralizing for the bears. There's really no "line in the sand" left to speak of. If the high set today is crossed anytime soon, the only goal left to conquer is the high set back in May (and, if that is crossed, the all-time high set in January 2000). The Dow "should have" (definitely in quotes....) resumed its fall where the green arrow is pointed (remember, click any image to see a much bigger image). But the bulls grabbed this ball and ran with it.


The NASDAQ 100, like many other indexes, is just underneath its former support line. There is a chance (hope springs eternal!) that this could be a turning point, since the former support is now resistance.


The S&P 100 is in a similar position.


Here is a heavily marked-up S&P 500 chart. We're still in the lower half of the channel that extends back for quite some time. I'm not exactly sure what to make of this graph, except that it sure was more fun to be a bear from June 1 to July 15 than it is now.


The Dow Utilities are looking pretty toppy right now.


The Amex Major Market ($XMI) looks like it's making another serious attempt at a breakout. The last time it did this, marked in yellow, it failed. We shall see if it fails again or pushes off to blast away from this consolidation zone.


The energy shorts I've got were just about the only bright spot in my portfolio today. There is some weakness here, and this is about the only graph I can point to as looking really primed for a fall.


What a bummer of a day. Yuck!

175 comments:

Anonymous said...

Tim,

I love the work you have done on your blog since the spring...so many different ideas. It's appreciated.

I sensed last week by looking at the Stoch and realizing that this selloff wasn't that intense that it was time for me to cash out of my puts.... Luckily I got out.

And judging from the board it is almost time to reenter but I am going to be patient. Has anything really changed? No. This market got forced up... artificially. That is why so many shorts got squeezed this week.

Earnings are going to be weak in October and growth will slow....patience.

Cheers

Anonymous said...

tim, been readin this blog for about two mos now, love it , you do great work, but the comment section has gotten ridiculous. its like a aim page for a bunch of "yes men". used to be intellegent posts with forethought and opinions with base, now like a penny stock site with a shitload of baseless opinions. i never agreed with hurricane5 but at least he did'nt just spout off.
love your "tech" take on things , but the comments have gotten sad.

Anonymous said...

Charts are fine for analyzing what HAS happened. They can't look into the future, they can't predict inflation, CPI, etc., things that set the market off. Look at the market day by day.

PB said...

comments are sad 'cause of too many anonymous posters without a name ... ring any bells?

Anyways, I think I have it figured out now! A decrease in liquidity (or appearance there of) will send the markets lower. Any indication that the liquidity spout is staying the same or opening, is enough to send the market reeling higher, no matter what the technicals or fundamentals say. That's why low GDP numbers are good for the market, 'cause it leaves the taps open. It's a tipsy turvy upside down world that leaves many people scratching their heads, including me!

Really and truly, LIQUIDITY is all that matters to the market right now. And now that I figured it out, the market will change to a different drummer! Gotta love it!

Anonymous said...

For the remaining of the week, I think a little upside is still left specially in nasdaq100. But next week is bear's week..

Ray

Nona said...

I know this has been a horrible week for you, Tim, so I just want you to know that I (like many) really enjoy your blog, including -- and maybe especially the fact -- that you always tell us what you really think.

I was introduced to the idea of cycles a while back. I think there's something to them (I think of them as "reversion to the mean") which is why I'm in the bearish camp: we're "scheduled" for a correction in '06. But unlike planetary cycles, market cycles are not exact and can be shorter or longer in duration than the "should" be.

My guess? You'll be vindicated -- just not yet.

Meanwhile, I love your blog, including its energy and verve. Thank you for creating it, hosting it, and (espcially!) for letting us know your thoughts, complete with charts!

~ Nona

Anonymous said...

pb: This is what I posted on the last blog:

I agree regarding inflation. Bernanke talked up a storm back in March-May trying to convince everyone that he was hawkish on inflation. In reality, it was all just a head game to crush the speculative hedge funds in the commodities markets.

We all know now that the Fed is not only dovish on inflation, but is completely controlled by the big money players in the markets. And with Paulson at the helm of the treasury, say goodbye to the US dollar.

Liquidity is the name of the game here. Dollar value and inflation are just pawns in the game. Once the markets start running south, they turn on the faucets to float the market higher. Maintain confidence in fiat currencies at all costs, regardless of inflation risks, by refusing to flinch in the global economic scene.

M3? What M3??

-Tony

2:01 PM

UrquhartCastle said...

I've been researching cycle theory lately (Seasonal and Presidential Election) for the last few weeks, and a lot of it makes sense to me. I am still holding on to my short positions, since I believe that the best is yet to come. From what I have learned, the bear paw will probably swoop down in the October/November period. THAT is when the markets will take a big ride down.

Anonymous said...

I don't want to advertise other sites here, but since this is a blog and not a for-profit website, I figure it's ok.

www.stocktiming.com has a pretty reasonable subscription price. The subscriber updates are "different" than the standard junk you read on the web. New technical indicators and just plain good information on liquidity flows, program trading, institutional activity, etc.

Anyways, I just thought I would share. I've been a subscriber for only one month so far and it's likely that I'll continue my subscription. Very good stuff. And like I said, it's different than the standard junk you typically read on the web.

Boy, I used to love Don Coxe's weekly webcast. That guy had the inside scoop on just about everything. Unfortunately, he has discontinued his public webcast and limited it only to BMO clients. If I had enough extra cash, I'd probably float some over to BMO and get signed up as a client. It would be worth it.

-Tony

Anonymous said...

Maybe this will cheer our fellow bears till bear market.



http://www.marketwatch.com/News/Story/Story.aspx?column=John+Dvorak's+Second+Opinion&siteid=

PB said...

Hey Tony,

looks like your sniffing around the same evidence I am ... Bernanke is gonna mess this up BIG TIME, and (hopefully) I'll be there to profit from it, on the downside of course!.

Yeah, Don Coxe, has a pretty good grasp of the big picture and he points to liquidity as the factor that drives this market ... good minds think a like I guess.

Anyways, always unleashing liquidity in troubling times will only compound the problems in the end. I truly think a big nasty crash is on it's way before this decade is out, which will then give birth to the next bull-market. Until then, it's just the same BS.

PB said...

Remember, Mr. Market's job is to take as many people's money as he can, how do you do that? By crashing the market, NOT by running up prices! This is just a little 'juice' to get the retail guys all wet and have them plow in before the next swoop down. Also, why the heck are interest rates so low? 'cause all the 'big/smart' money is in there and not the stock market. Why? Excesses from the early eighties onwards have not been fully flushed out of the system. Pappabear is coming to town!

Anonymous said...

Here is what I think happens tomorrow, we get an early morning rise followed by a minor selloff, I would be adding to QID at NASDAQ 2165-2170.

HPQ will lift the techs but how much, if i was in NVDA, SMH, AMD, INTC or BRCM as of last Friday or early Monday I would be certainly selling for a profit. Amazing how quick everyone forgets about the JULY lows when the markets are in rally mode. I dont think were jumping out of a trading range just yet, I think the dow tops off at max 11450-11525 and starts its next fall. NASDAQ TOPS 2200.

Trader 2006

Super Bull said...

Short term the market will be alot higher. But next year, if there is high inflation, then the Fed will be once again forced to raise rate and that will kill the market. But right now, you got to long stocks. One recommendation is SHLD which really got its cost into control.

The Hube said...

Mr. Market's job is to take as much money as possible from everyone, longs and shorts alike. Right now he is taking it from the shorts. As soon as the shorts get squeezed out and the longs grow more confident, look out,
Right now I'm thinking we are likely to see a double top in the $INDU before we crash. The next one will make May look like a picnic for the bulls. Sooner or later fundamentals matter.
I can't count the number of times I heard talking heads mention evidence of a soft landing. I have seen lots of evidence of a slow down, even evidence that the economy is slowing faster than most economists anticipated, but I have seen zero evidence of a soft landing (which I think, in any event, would only be able to be seen in a rear view mirrow).

bsi87 said...

PB

You're close but Mr. Market can also take money by skinning the bears and getting the bulls to chase. And he got 'em at 10700 by skinning the bulls and getting the bears to put on short positions.

chanon said...

Make money both way, Long and Short.

Tim, I use MarketMatrix throughout trading hours, to scan for strength and weakness. I wondered if the sector column...it will be great help if it show the intraday percent gainer or looser, much like the one on Yahoo industry center Yahoo Industry Center

I try to find weakness in stocks of intraday sector gainers.
I don't how difficult it is to implement it....just my idea.
my picks

Anonymous said...

many coming out saying dow 12k, dow 11700, dow up another 400 points by the end of august....come on guys. A while ago there was a 2-3 day rally and everyone was bullish a few days later everything came down and the bears were owning the market. I feel the same thing this time, we may go higher but not much higher. Before you know profit taking will be back and those huge triple digit drops will be back again.

Trader 2006

PB said...

Trader 2006

you're right, nothing's changed, the picture actually looks worse (except for price) , but participants are still too complacent which is not conducive to a lasting rally. The market thinks we'll have a soft landing, once it's clear things will 'hard' land, today will be remembered as a damn good day to short! This is exactly what I've been waiting for (never actually thought we would see it) but things always seem to run deeper/higher than I think.

fastermasterblaster said...

The technical consolidation period following a long term linear downtrend (especially the recent Nasdaq trend) allows the scales to balance the other way. What was bear advantage is not in the deuce court, but definitely advantage to bulls. We should continue to see a strong bull run that will be newsworthy. I suggest bears head for the hills until the market over reacts the opposite way. Nasdaq is going to be a hot play from here on out.

AT said...

I think I mentioned in some previous post that fund managers were sitting on a lot of cash and were desparate to invest. I stand corrected - The Big Picture blog (http://bigpicture.typepad.com/) has some charts showing low cash levels with mutual funds (4.5%). So if the funds are not powering this rally, who is?

Anonymous said...

PPT (plunge protection team) of course, why do you think they stopped reporting M3?

Watcher said...

Anyone notice QCOM's meteoric rise over the last couple of days and the simultaneous favourable remarks by Merrill Lynch? A few days back, QCOM was falling to $33 because Sprint adopted WiMax instead of QCOM's CDMA technology. Now, its options expiry, and surprise, surprise, max pain for QCOM is $37.50. How convenient that QCOM moves up 4 bucks in 2 days, without any news. Well done, Merrill Lynch, we all know there will be no accountability, no SEC probe, when QCOM just as mysteriously dips back to 33 next week.

Anonymous said...

The NYA program trades have been floating a ton of liquidity back into the markets. You can see it between 1:45 and 2:15 PM on the past couple of days.

Adding fuel to the fire is the fact that margin players are getting squeezed out in the process. All sorts of resistances have been just absolutely demolished in the last 3 days. The resistances have been absolutely NO RESISTANCE whatsoever. And nobody considers that as "odd"??? Say it with me, folks: M-A-N-I-P-U-L-A-T-I-O-N.

Whenever things need to get shaken up, they just turn on the faucets. This is pure maniplulation, it's not "stupid bullish retail investors".

Unfortunately, there's no way to know whether "They" want to float the markets up, or crash them down. I guess it depends on whose money they want to take, the bulls or the bears.

Back in May, it was the bulls. This time around, it's the bears. My guess is that it will be the bulls' turn to get their money taken away pretty soon. The only question is, when?

After a 4.4% gainer in the Naz, I'm suspecting that it will be sooner than later, so if we do get another 20-point day or more on the Naz, I'm doubling up on my QID.

-Tony

Anonymous said...

Watcher,

Thanks for sharing the info on QCOM. Where do we get the max pain numbers for a stock? Looks like this is probably a good way to stick it to "them"

- Jay Mac

Jason said...

Hey guys, dont want to pump my blog (which is just my thoughts among many) but i found a great picture of a look into the future of a BULL trader in the next 4 weeks.

Just joking, it can be a bear also, but its a funny pic.

www.thetenreport.blogspot.com

Anonymous said...

Hey, anyone out there notice that Ford (F) has risen over 30% in the last 3 weeks???

HAHAHAHA!!

The stock has been overbought for more than 2 weeks now, gapping up 4 or 5 times in the process.

That's hilarious.

-Tony

Anonymous said...

Tony

That is the joke of the day for me. What the f*** are people who are buying this sh** thinking? Looks like a good short for me.

As you mentioned the stock is way over-bought, but it above both the 50 and 200 Day MA

- Jay Mac

PB said...

Ford is a screaming short, as is GM, but where do you see the gaps?

Anonymous said...

I guess "technically," the gaps have all been covered. But not very well. I would definitely NOT rule out the possibility of a 62% Fib retracement here, which puts it around $6.89.

As I said, it hasn't shown weakness yet, but it's running up against HUGE resistance in the low $8 area. If it gets pushed back from here, I wouldn't mind piling on the shorts for a quick 10% gain or better back to the low $7s.

-Tony

PB said...

at $8.50 (F) I'm shorting ... it's funny how all the crap got bot during the last two days!

Speaking of gaps, AAPL, SNDK and ISE among others, have nice gaps to fill on the downside ... just a matter of time!

Anonymous said...

Great comments by everyone.

TONY agree with your comments.

As for the overall market i think it is manipulation, complete manipulation. Its program buying, thats all. They can pump this market anytime they feel like it. BRCM up over 35% on what basis. NVDA had some options game going on stock falls over 2 bucks to 22 now over 27, QCOM hahaha sadddd.

So many are wanting in on this market. I for one am looking at 2 possible position tomorrow:

USO at 65.50
QID 65-65.50. I dont see another 25+ gain on the nasdaq.

Anonymous said...

by the way Ford is looking very good to short.

Trader 2006

forgot to sign my last post at 8:48pm

Anonymous said...

new shorts for tomorrow TOL.

Stock has bo reason for the last rise.


trader 2006

Volvosan said...

I would make a few relevant technical points on the Nasdaq - first, the rally is just now hitting it's head against the 38% fib level in counter-rallying from the 340 point drop it saw starting April 21st. Second, the VXN has hit it's lower Bollinger band yesterday, and actually bounced up today, and third, the Nasdaq itself is just now hitting it's upper Bollinger Band. Thank you very much, Mr. Bollinger!

Anonymous said...

Jay Mac
Here's a site with a max pain calculator:

http://www.iqauto.com/cgi-bin/pain.pl

btw, right now, max pain for QCOM is 35 not 37.5.

bsi87 said...

MasterBlaster: How's things in Bartertown? Great movie. All major indices are in nontrending modes except the Naz and the indices are touching resistance areas. Nice 2 day rally but no new highs and divergences popping. We'll see in the next few days as opts exp unwinds.

Watcher: There's a "playbook" that hedgies and others have on their desk for days when they need to jack performance. This play is called "Grab high beta liquid stocks and pump my YTD returns". SNDK and QCOM have been favorites. Full disclosure: I'm short SNDK as of yesterday and was watching QCOM to hit 38 or so and reverse but no soap.

re:homebuilders. JMO and no position but ST there's support not too far underneath current prices. I'd look for those with a 5 pt minimum downside between current price and 20 day Bollinger Band.

shorts: I'd go to Morningstar and look at the QQQQ top holdings and look at longer term charts for each, try to find those that have broken down already and look to short them on rallies to shorter term MA's. Just a cursory look turned up AMZN as a potential. Do your own homework.

EddieFl said...

Here is a good stock to short. I missed the last move up from end of June to now where it has gone up about 85%.

I have shorted this stock before it is a good trending stock. I miss the move up, but I am lookinf forwarding to riding it down.

The stock is: TNT (russian oil company). The only thing that worries me is these adr's from other countries can collapse over night, its great if they drop and you are short, but if not, watch out.

Anonymous said...

Ford has a date with it's 200 day at $7.46 --- pile on the shorts! It might trade down in sympathy with the GM downgrade!

Investor 2006 (used to be trader '06) but this market is messing with me!

Anonymous said...

Thanks eddie, TNT looks great.

Money flow is very weak, volume is low, stochastics are way overbought, and it's way above its 50- and 200-day MAs.

Looks like a low-risk short here, too. Maybe 6 or 7 points on the upside, and I can't even count how many points on the downside... maybe 35-40??

I had looked into TNT earlier in the year, but forgot about it since its big decline.

Thanks.

-Tony

EddieFl said...

I know Tony, check out the daily on TNT on a one yr chart. Look at the move before the late june rise, what a decline, its about 50+ points each way.

Its on my radar, it trades kinda strange, on a huge up day or down day it actually doesnt correlate, it trades on its own accord,

Anonymous said...

Ok, I don't get this. Please can someone explain it to me??

QQQQ is up 0.08% on the day so far.

QID (double inverse of QQQQ) is down 0.37%.

Why is it more than 4 times the inverse???

-Tony

Anonymous said...

I think I may have answered my question. It appears that there's a 0.2% fee that's tacked onto the ETF.

Nice.

Anonymous said...

tony i usually judge QID movement by the NDX 100

trader 2006

Anonymous said...

Market is looking for direction this morning, may be a while before we find one. Nasdaq off 1 dow up 5. BOring if you ask me. Not worried to go long any sector ETF when I have SDS and QID as back up. But im waiting patiently for QID to head back to $72+. The patience will SURELY pay off.

Trader 2006

Anonymous said...

I think it will be time to enter into USO soon, im waiting patiently for something under 65


Oil falls sharply on healthy fuel stocks


http://news.yahoo.com/s/nm/20060817/bs_nm/markets_oil_dc

Sanjay Sola said...

i'll let the market get overbought and short the heck out of it. right now, i'm in cash. September is a tough market month usually and with earnings season out of the way, it will be easier.

Anonymous said...

anyone think 1297 will be taken out on the spx, yesterday some guy on cnbc said that is a key level.

Anonymous said...

They upgraded AMD today, that stock has had a nice steady rally these last 3-4 weeks. Up over 38% since its mid july sell-off. If i was invested in some of these companies with 25-45% gain i would be selling. There is no way these stocks gain another 25-35% in the next 4 weeks.


trader 2006.

costas1966 said...

Ideas, NCTY just cleared resistance at 25.2 volume run rate about 700,000 (very heavy) it can go to 27 even higher

bsi87 said...

PSQ. Bought a bit yesterday. Set a buy stop above the high of the first hour.

VXN popped up at the open, showing some good fear. Has since dropped. P/C dropping. See what happens this afternoon.

Anonymous said...

Markets flat, HPQ and AMD are keeping this market higher. IF HPQ had reported a dismal qu it would be a nice day for the bears. DELL reports tonight, not looking for anything great. That stock used to be a big market mover but not that much today. Patiently waiting to add more to my QID postion.


Trader 2006

Anonymous said...

Man, it certainly looks like this rally's out of steam. But for some reason, it doesn't seem to want to break down.

I don't get it. Someone keeps pumping money into this market. Obviously, the day is FAR from over, but it's not looking very weak from where I sit. The markets tried several times to get into the red, only to pop right back up again.

The Naz is now sitting at a 5% gain in only 3.25 trading days.

Unreal.

-Tony

krispytoast said...

I am going to be in cash for the next few weeks. Hopefully by then the there will be some kind of market direction.

IBD is saying that we are in a potential rally.

who knows for sure?

Watcher said...

More on the options expiration and max pain theory. Look at SIRF - a few days ago it was dropping below 19. Now its risen to around 24.7. No news. And would you believe it, max pain for SIRF is 25!

I think shorting QCOM and SIRF around this level tomorrow will make at least $4 each next week.

Anonymous said...

"IBD is saying that we are in a potential rally."

of course after the fact.

No one could have predicted this. Market is being pumped up by the hedge funds. They own the market. Im sure most of them on days like this are sitting on tens of millions worth of gains.

Trader 2006

AT said...

"No one could have predicted this."

You're right. I try to check different sites and blogs, especially those with contrary views. But this time, almost all were bearish. But I forgot that when everyone is bearish, its time to get bullish. Just like when the bulls get overexuberant, its time for the market to drop. This is an old, old observation, and I wonder why most people forgot this.

Anonymous said...

agree at as I see the markets touching intraday highs. Just as we sold off 3-4-5 days in a row, we are pushing higher the same way. SPX 1300 is 1 point away, some bull on here said once 1300 is crossed its going to 1340.



trader 2006

Jason Y said...

Folks, I bring you good news. Be patient till Monday. Let the options manipulations get out of the way. You will see your market drop, you will profit from your shorts.

Right now you are seeing an enormous pressure by some of the big boys, those who wrote the puts and calls. They have to make sure that most options expire tomorrow. Or else they go out of business. Its a matter of their survival.

This rally is completely artificial. You can plainly see most of the run up is in the stocks with the most options, and to the point of 'max pain'. Friday AH or Monday AM you will see big blocks of these stocks dumped by these guys.

So stay tight, don't fret, and be ready for the downswing. This week's gains will be wiped out next week.

Anonymous said...

Jason agree about the options statement. Someone on wallstreet has to make money and get their fat bonuses on wallstreet.

Trader 2006

Jason said...

16 Minutes till the Philly Fed report, lets see wht comes out

Anonymous said...

I have been telling folks about this rally on Tuesday. The precursor was there on Monday. The fact that alot of you refuse to believe it and use the fundamental basis as a way to hold your short position is pure ignorance. The market will do it's thing.

The person that needed help 2 days ago with his deep losses are now even in deeper hole, assuming he didn't get stop out and listen to some of you here to hold.

Trader II

Anonymous said...

The market is breaking out and ready to challenge the old highs soon. Either you join the bull party or sit on the sideline.

Anonymous said...

Is anyone else out there getting stopped out of trades on a regular basis? Mostly short, but I've had a few longs go against me as well.

Also, is anyone trading in a TAXABLE account? Just wondering what you do about all the trading documentation when tax season comes around.

Thanks.

Jerry

costas1966 said...

Another long setup, Elos double bottom with a handle formation. it can go to 26

Anonymous said...

Trader II

"precursor was there on Monday"

explain, market was showing nothing of the sort, this rally is based off of the CPI and PPI data THATSSSSS IT. Nothing else. WAtch the selloff carefully. Everyone will be wishing they sold up here...



Trader 2006

Anonymous said...

oil had something to contribute to this rally but I feel oil will make its way back to $75.

Trader 2006

EddieFl said...

Spx 500 high today at 1299.00, ok I called 1300.00, two weeks ago.

Honestly since this rally is on the fron pages and newsletter everywhere, it is probably coming to an end soon.

Although I will ride the trend until it changes and the trend is up.

Anonymous said...

cnbc is hyping it up left and right. Kudlow is happy as anybody, saying this is the greatest story never told or something like that.

Anonymous said...

HPQ giving up, nearing intraday lows

Trader 2006

Anonymous said...

Trader 2006,

On Monday we have a 100 point move on the dow only to fade in the afternoon. Clearly the market is showing strength in wake of those 2 big numbers (PPI, CPI). When the numbers confirmed the follwing 2 days, the market finally reviewed it's hand. The Dow is up over 300 points the last 3 days and most of the shorts here continue to fight this trend.

Look at the daily dow chart over the last 6 months and you'll see a symmetrical move with double bottom at 10700. If this move plays out the way it does, 11,700 should be fast and furious.

Trader II

~ Nona said...

Jerry,

I do all my trading in my IRA accounts precisely to avoid tax reporting headaches.

Over half of the value of my regular account is in cash because I, too, anticipate the possibility of a serious decline. That said, I made two purchases yesterday (MO and SYT) and one today (DOW) in my regular, taxable account; all are positions that I expect to hold for a long time. Yesterday's purchases were additions to long-held positions; today's was the first purchase for a position that I expect to build over time.

I don't know that I'm doing the right thing vis-a-vis the taxable and non-taxable accounts, but this is the way I'm dealing with the issue. I, too, would love to hear what others have to say.

Anonymous said...

After seeing the rally fade on monday I think was selling ahead of the PPI data, thats all.

As for 11700 the charts may show it but I do NOT SEE A CATALYST for this market. I just dont. Even if 11700 is taken out and 12000 is reached congrats to all bulls but im holding onto my QID and SDS. Last time I bought QLD the markets were in drop mode and everyone thought i was crazy well now I own QID and will not sell until I see plenty of green in my portfolio. I think a drop in the nasdaq back 2050 is certainly possible. Im not betting my entire portfolio on a drop just about 40% of it. Time will tell.


Trader 2006

Anonymous said...

Trader 2006,
Very seldom do the market show a catalyst and let you get in for the ride. By the time the catalyst unravels it will be too late. It's best to step aside for now. Alot of charts are starting to break their downtrend and it's only gearing up for the next leg up. I've been pounding on the STOPS for 4 days. USE IT!

Trader II

Jason said...

I dont like that the fact the trannys arent participating, still denotes IMO that the problems that were at the surface awhile back are still there and just being ignored, and that can come back and bite this rally attempt in the near future.

Basically the trannys should be acting better than this.

Anonymous said...

I think the thing that bothers me most is the fact that as soon as the indices show ANY signs of weakness, the money just gets pumped right back into them.

For example, early this morning, the indices were quite weak, drifting into the red for a while. Also, right around noon, the Dow drifted back to a gain of only 17, but within 10 minutes, it drove back up to 37, the highest point of the day.

Somebody or some organization is floating this market. This is not "normal" price action. There is absolutely no profit taking, no weakness in ANY of the indices. And all of this because the core CPI was 0.2% instead of 0.3% (even though the CPI itself was 0.4%, as expected)???

There's absolutely NO way that those PPI and CPI readings should have had this effect on the markets without serious manipulation and money being floated into the market. Hedge funds? M3 money? Who knows.

I just don't see why those simple readings (which are frequently inaccurate anyways) could cause a rally like this. Earnings and guidance CERTAINLY have NOT been the cause.

Anonymous said...

IYT was down around 75, was going to buy last week but said nah this market is headed lower. Now close to 80 Go figure, I never have any luck in this market.

Anonymous said...

Hedge funds is why this market is floating higher, im watching the the dow and agree that everytime it has weakened by 5-15 points it moves to a new high for the day, im not trading that. Unless the market weakens by afternoon than maybe but this market is being manipulated. Incredible.

Trader 2006

Anonymous said...

1300 on the SPX is .45 away, lets see how they cheer on 1300. lets see if we have a run to 1340 like one of the posters said.


Trader 2006

Anonymous said...

It's global liquidity gone wild. Have a look at the Hang Seng Index. It printed new 52 week, 5 year highs this week and money continues to pour in. We'll see that here soon. It's now a global game.

Trader II

Anonymous said...

Hedgefund???? You think with the volume explosion to the upside the last few days it's because of hedgefunds? This is institutional buying. Pure & Simple.

fastermasterblaster said...

Naz is leading the charge and this rally is just starting. Since the scales of justice are tipping toward the bulls the completely oversold techies (think Kmart 50% off blue light specials) plus covering is adding fuel to the rally. I see no manipulation, just participation.

Anonymous said...

A quote from Tim last night.

"If the high set today is crossed anytime soon, the only goal left to conquer is the high set back in May (and, if that is crossed, the all-time high set in January 2000)."

Anonymous said...

So i guess thats it, ill cover and sell my puts and go long because now there is a 100% chance that the dow goes back to 11700, thats it, what happens when and if 11700 is reached and october starts creeping up. Will that be the excuse to sell and go short.

Anonymous said...

What you are seeing is a classic, textbook example of how a bullish reversal takes place.

When everyone is doom and gloom and shorting with all they can, a few of the large institutions use some excuse (this time it was PPI & CPI, could have been anything) to pump up some of the shares. Shorts with tight stops are taken out, the institutions unload their shares on them making a profit. Then they repeat this process taking out new bunches of shorts at higher and higher levels. The big institutions keep making profits at each stage - its the shorts who lose out. The process is self-sustaining because of the large number of shorts who panic, and keep covering on each dip. The shorts with the tight stops suffer the least losses. Where the rally stops depends on the number of shorts, the number of profit takers, and any external news. In this case, news has been good (good HP earnings, lower oil and gas, ME ceasefire holding, etc.). So we may see the rally sustained for some time. I don't agree its all because of options manipulation. Some of it may be that, but because of this process, we should be seeing a sustained rally.

Anonymous said...

Anyone still short from 11K should have their tradings re-evaluated. No reason anyone should take a 360 point jam against you.

Trade Safe

Trader II

Anonymous said...

I don't agree that it's just fund money. There's just absolutely no way they would continue to buy, buy, buy for days at a stretch like this.

Manipulation is seen when the indices absolutely fail to decline even 5 points or so. It's a perfect straight line upwards. If funds were buying, they would buy in blocks, not in a steady stream over the course of 4 days.

Just like when the markets go down, the sellers hit the bid and short at the same time.

Think of it this way: SOMEBODY had to be selling their shares over the last 4 days. And for the indices to rise in such a straight line like that, there's no way it's just "random chance."

Look at the 5-day behavior of COMPQ, INDU, SPY, QQQQ, or whatever. There aren't even any dips or spikes at all. It's a nonstop stream of buying.

That is NOT how funds operate, especially in this environment.

Anonymous said...

Good news is bad news and bad news is good news. When does that factor change. When does a bullish GDP become great news and not bad news. When does a great job numbers become great news and not bad news. Seems that the trend were in now is that a bad GDP is great along with light employment numbers.


Trader 2006

costas1966 said...

"I don't agree that it's just fund money. There's just absolutely no way they would continue to buy, buy, buy for days at a stretch like this."

I dont agree its just fund money either. I did a little bit of buying today so there is some of my money in there as well. :)

Anonymous said...

"Look at the 5-day behavior of COMPQ, INDU, SPY, QQQQ, or whatever. There aren't even any dips or spikes at all. It's a nonstop stream of buying."

Sorry to be rude, but this is actually funny. To see un-abated straight line buying for 1, no 2, no 3, no 4 days!!! And yet you didn't join the party. The problem isn't the government nor the market. It's you. Alot of folks here have embledded bearish views here about the economy and the market. Market fundamentals don't drive the market liquidity does.

Trader II

Anonymous said...

costas the bear turned bull or???

Only possible way I would buy these markets is on a minor dip, say if the dow backed off to 11250 and nasdaq 2125. Then i would add, only buying into ETFs such as SMH, EWZ, PSI, PHO, PIV etc. Knowing my luck ill add on a few long positions only to see profit taking kick in at 10am tomorrow morning.

Trader 2006

Anonymous said...

Look at USO dropping hard the past few days trading around 65.90

Sitting on the sideline for now.

- Jay Mac

Anonymous said...

Anonymous 10:04
Its the shorts covering on each dip which you see as buying. The institution just buys a block of shares early, drives the price up, and then sells the shares to the shorts who got stopped out or panic and cover. Old, old trick, I wonder why no one saw it coming.

costas1966 said...

trader 2006 i bought ncty today at 25.62 and elos at 22.69 and ezpw at 35.56. They are all bullish setups that could work in a matter of 2-3 days after that I am out and i reevaluate what the market wants to do.

EddieFl said...

anon at 10:00 a.m., good post.

You have to sit back and think, what do you really want from the markets. Do you want your opinions to be validated, to verify your jr.economist analysis. OR do you want to trade the markets and go with trends up OR down with technical indicators.

Its been flat to up for the last month, with the last 4 days, showing itself in force.

If you trade the econ news, much easier would be to go to http://www.economy.com and just trade from the headlines, dont even look at the charts. They have a nice blog there as well. Its would save you time and commissions

"Everybody gets what they want from the market, what they REALLY want"--Ed Seykota

Anonymous said...

"Its the shorts covering on each dip which you see as buying. The institution just buys a block of shares early, drives the price up, and then sells the shares to the shorts who got stopped out or panic and cover. Old, old trick, I wonder why no one saw it coming."

Those are your assumptions. No one knows, nor confirm this. We use technical analysis to spot entry, exit & price trends. I think we should use it.

Anonymous said...

Trader II here is a list of reasons why I think new great highs on the dow is limited

Inflation on the rise, people who think inflation isnt there has problems.

ARMS are in reset mode, individuals paying more out of their pockets then they were a year ago to live in their nice new house that they bought with NO MONEY DOWN!!!

M3? what M3???

Housing bubble has popped, I continue to read the news about a glut of houses and condos on the market. The sector is done with. I see another 5% drop in housing prices by the end of 2006 and 8-12% dip by end of 2007.

People using there houses as piggy banks is nearing an end. How much can you borrow against your house to fuel your spending habits. With rates up the cost to borrow is going higher. 2/3 of the economy is based on consumer spending. Without the consumer spending what do you think happens.

NEGATIVE savings in America. Everyone spends spends spends. Major debt on the rise.

Value of the dollar continues to drop.

OIL still trading above $70.

A war that is costing billions and billions of dollars

Possible recession in 1st half of 2007.

Corporate profits slowing.


Trader 2006

Anonymous said...

watching the dow trade up 43 down to 40 back to 41, soon to be 46 if the the manipulation continues.

Trader 2006

Anonymous said...

"Think of it this way: SOMEBODY had to be selling their shares over the last 4 days"

_____________________

That's entertaining, considering you're posting this on a bear site. Ever occur to you that selling and short selling look alike?

Anonymous said...

haha AMZN up $1.55 and EBAY up over $1.85.

Incredible.

these 2 g net stocks that had such pathetic earnings taking advantage of the 3 day rally.

Trader 2006

Anonymous said...

Trader 2006,

Again, those are fundamentals/news of the market and since we are all know about it, it's already old news. I have pointed out that if you look oversea in the Hang Sang Market, it have just printed new 52 week high and 5 year highs. The Hang Sang market are facing the same issues here. A bubble housing market, inflation, high oil/gas prices etc. but YET it still print new highs? Why? I don't know, nor does anyone else. But what i do know is it was able to climb to new highs despite all the negative news. My years of trading have taught me to see a trend and don't fight it. The news is all noise.

Trader II

downosedive said...

So you think those with influence are buying as an investment at these ridiculous levels? Ok, so where were these dumb tossers when the market was below 11000? Do you all think serious investing institutions just sit around and wait for news to come, wait and see what the market reaction is and then join in by buying. Thats whats amateurs do. The prices are being marked up by your marketmakers and the amount of buying actually going on at those inflated levels is very basic. The sustainablity has more to do with a lack of sellers than anything else. Simple as that. Few people want to take on the market by selling, whether its the futures or actual shares under these circumstances. Until there is collective selling of substance or until the marketmekers decide to protect their wholesale trading positions against a possible selling spree by marking the prices down instead of up, this farce carries on. I think at any time now though, that protective cover will come and then be reinforced by some good old fashion profit taking. If you were a fund mamager wouldnt you rather buy a 'good thing' at a low price and not a high price? As it happens the entire markets are so over inflated, none are worth buying. Role on a repeat of 1987, because this is very similar to what happened then, in terms or sentiment. Remeber the Titantic was thought to be unsinkable......and that misjudged, ill informed and arrogant belief is exact what exists right now

Anonymous said...

AMZN filling the gap up 33 to 29.

I read so many posts with detailed analysis recommending going short on AMZN at 25. Now it is close to 30. This is incredible.

Guess what? The max pain price for AMZN is .............


30


- Jay Mac

Anonymous said...

"Think of it this way: SOMEBODY had to be selling their shares over the last 4 days"

_____________________

That's entertaining, considering you're posting this on a bear site. Ever occur to you that selling and short selling look alike?

10:32 AM



Now let's be reasonable. You can't use the argument that this rally is fueled by short-covering, then come back and say that all of the sellers in the last 2 days are short sellers!

So which is it? Short covering or short selling? You can't have it both ways. I don't know of one single short that covers his position, then reshorts immediately.

Anonymous said...

Downosedive said:

"Do you all think serious investing institutions just sit around and wait for news to come, wait and see what the market reaction is and then join in by buying. Thats whats amateurs do. The prices are being marked up by your marketmakers and the amount of buying actually going on at those inflated levels is very basic."


Wow. Very good stuff there. I completely agree. You don't see fund managers waiting until the train has already left the station before joining in the buying spree. If stock prices are so damn cheap at Dow-11,350, then doesn't it stand to reason that they were DIRT CHEAP at 10,700??

This is manipulation, plain and simple. There is no other alternative. Big Money buyers don't buy stocks when they're already 20% off their lows and on a major 4-day runup. They're SELLING at these prices.

It's amateurs like some of the bulls around here that are buying their shares, just to jump on board the train. That's fine, if you can scalp a profit, but I get the feeling that when this train stops, people will go flying off.

Watcher said...

Jay Mac
Glad you are using and proving the max pain theory.

Next time, you can make a killing from it.

Anonymous said...

I know on the next dip people will regret not selling now. If we go red thats it for the day, profit taking will begin. IF we stay green could finish the day strong but who knows.

As for AMZN jay, i would be willing to short but that would just increase my risk in my portfolio, im good with my QID and SDS for now. Have cash to play with but really waiting for USO to drop under $65 so i can buy. Last time it dropped to the mid 60's it rallied. Not saying it will happen again but I think oil looks oversold.

Trader 2006

Anonymous said...

watcher where can i find the max pain theories


Trader 2006

Anonymous said...

I remember watching Cramer last week talking about how AMZN and EBAY were out and VCLK, NILE and IACI were in. Funny EBAY and AMZN are up about 2-3 bucks since then. Cramer times everything perfect ahhahahaha

Trader 2006

PB said...

Volume explosion?? In which market?

Volume has been anything but explosive? We are looking at a global slowdown and you'd have people buying in here?

Anonymous said...

Hey guys! The rally seems to be fizzling.

But watch out for institutions to step in in again - they have to keep it up till tomorrow. After that, its downhill all the way. Yipee!

PB said...

Nothing has to be kept up 'till tomorrow ... if a position is profitable today, why not take it and be done with? Without any 'good' news, this market will turn to Mr. Softie ...

We are now just bouncing up from that first trip to 10,700 ... next time around, the market will just slice through it.

Anonymous said...

Wow, the Dow just dove hard and fast down from 42 points to 6 points in like 20 minutes.

Looks like the liquidity faucet has been turned OFF today for the recent 2 PM market float.

If profit taking ensues and continues past 3 PM, the bears could be in good shape.

-Tony

bsi87 said...

Well gotta get my 2 cents in here.

Rather than debate, I looked at the Naz 20 day prophet chart, 2 hour time frame. It's very instructive. You can see the Fed rally, the jobs rally, etc , all of which died on the vine. On this scale, there was a nice H&S pattern that, if the neckline at 2050 had broken, would have put the Naz below 2000. But late Friday afternoon last week when it didn't break, I closed all my short positions. That was a good move since there was a gap up open this past Monday.

But it's like someone threw a switch, there's a straight trendline support up. One might have gotten long when the descending trendline resistance from the head and right shoulder was broken but that was at 2080, 1% in, 1% out and so far the rally is a 4%, netting the trader 2% in about 3 days. That's a good return but tough trading IMO.

One would be better served being flat during opts expiration week IMO. And I don't think traders should beat themselves up over "missing" this rally/trade.

Luck to all, buy stops above the open for PSQ and SH.

Watcher said...

Here's the site with the Max Pain calculator:

http://www.iqauto.com/cgi-bin/pain.pl

It has links to the theory too. Amazing articles. Cramer (I always thought he was a nitwit) wrote an article on it in 1997. Too bad his stock-picking isn't better than a monkey's (www.cramerwatch.org). But the theory itself seems to work. Purdue University has done some serious work on it.

Anonymous said...

IMO
people who say that the fund managers are playing with the market are assuming that all fund managers are great at their job. " that is untrue "

there really is only a few great fund managers. considering that there is thousands of funds , there cannot posibly be thousands of good managers.
yes, they have more money to work with, but they will still have their own HERDING mentality

I refuse to believe that they act in concert with each other, they compete with each other

bsi87 said...

Shorted QCOM at 37.84, now reversing. Buy to cover at 38.07/38.14 stop/limit.

bsi87 said...

SNDK now below its open and close like QCOM.

The big boys are leaving.

Anonymous said...

Cramer is worth $60 million. He can say whatever he wants!

Anonymous said...

BSI you mention:

"On this scale, there was a nice H&S pattern that, if the neckline at 2050 had broken, would have put the Naz below 2000. But late Friday afternoon last week when it didn't break, I closed all my short positions. That was a good move since there was a gap up open this past Monday. "

thats why its tough to trade this market, the charts were showing that but when the economic data came out all was changed in seconds at 8:31am tueday morning after the PPI was out.

Anonymous said...

those "amateur" bulls made a lot of money in this unexpected run.

funny, in another much earlier post i mentioned the gnomes would jack up this market. Paulson, no doubt, was ordered to "make it happen" and given the liquidity to do so - and he is.

the question is whether this rally will sustain until the november elections are over. keep in mind that this administration has not generated any good news since its inception and incumbent republicans are panicking.

inflation? according to the gov stats inflation is under control. the real danger is that the dollar is in danger of being yanked as the world's currency. if that happens gold flies high and the major players with all their short positions will fall heavily. now that would be a crash!

housing? bubble is leaking. refinancing provided a lot of liquidity for consumer spending. don't count on it in the coming years.

energy? might drop if there is a significant slowdown in the economy but a hard winter, hurricanes, and midEast instability will float this sector.

my pov is that this rally is all political. the question is will the gnomes attempt to break dow 12000?

i got caught with puts and got my behind whipped. well, that's the trader's life...

as a closing: let us think of the poor soldiers in iraq who are being forgotten. i may have lost some money in this market, but they are losing their lives, hands, legs...

good luck to all.

john

bsi87 said...

If the indices close below their open and previous day's close, I'll put sell stops below this morning's low and trail 'em for PSQ, SH, DXD, etc.

costas1966 said...

weaknes in anything metal related copper with names pcu and pd titanium with names like tie ati, steel: nue chap zeus. Next intraday rally i am goin gshort side on some of those guys

PB said...

Oh come on!!! what the BIG F, happened here??? I thought we were going to DOW 12K by friday???

This is the best time to buy kids!! Don't let those lying bears lead you astray! The only risk is NOT buying!!!

Anonymous said...

bsi87,

You seem to be an experienced trader. I am a beginner and lose a lot of money(painful lessons).

Are your trades profitable?

bsi87 said...

anon re economic data.

Couple key pts. The mkts had a helluva chance to crack last Friday. When they didn't by the last hour, I thought it was time to get out. And when the mkts did the opposite during opts epir, I should have put on at least a small long position but I'm human, I thought the DJIA would get to 11,100 or so and that'd be it.

Definitely tough to trade BUT by using smaller positions and sitting on your hands, you can make some money AND not lose much until either the mkts hit tops/bottoms in nontrending situations or they resume trending again.

JMO.

vince said...

"IBD is saying that we are in a potential rally."

You mean the one that's been happening the last 3-4 days? LOL. If you're not already on the train, I guess you could wait for a pullback, but we are headed to historically the worst month of the year AND pending 4-year cycle lows in autumn.

Anonymous said...

tie is fun to short if you time it right you can make quick money. Traded it a few times before. Last short i had on it was $32.50, right before a fed announcement, after that the stock went up and I sold, if i would have only held onto it. hahah. Never traded it after that.

Trader 2006

Anonymous said...

could someone tell me to hold off on USO im sooo tempted to buy it here. I think it could be trading back at 67-68 sometime next week.

Trader 2006

Anonymous said...

Right now every bear in here is wishing they added more to their short positions and every bull is wishing they sold. I for one was going to add more to my QID at 67 but held off, then at 65.90 i was tempted but said no way. Ended up with no trades today, just sitting back waiting to see where we head by 4pm. Next week is a different story.

Trader 2006

Anonymous said...

Is there any rhyme or reason to this market? Bearish, bullish, bearish, make up your mind!

Anon 10:24 "Those are your assumptions. No one knows, nor confirm this. We use technical analysis to spot entry, exit & price trends. I think we should use it."

Technical analysis is useful and I rely on it a lot, but did it indicate this rally? Or this reversal we're seeing right now? All the trendlines, patterns, indicators - nothing forecasted this. So you have to know how the market works, too.

bsi87 said...

anon painful

Not every trade is profitable. I have my share of losers. I have my share where I let my ego trade.

Suggest you find Elder's Trading for A Living and Come into My Trading Room. Most libraries may have them or get thru interlibrary. Read them both about 3-4 times esp parts of position size and money management. Not every trade has to be a winner if you practice good money management. And control risk thru position size, good entry/exits, and stops. (And yes, I know that stops don't always work).

Good luck.

Anonymous said...

I got margined called yesterday even though I've been saying that 2145-2150 will be met with heavy resistance. People ask me why I don't stop out. Stop out with losses? Are you crazy? A crash is coming and you expect me to accept losses. Today proves my point. I'm setting up a loan on my house to reshort that puppy. I can only be wrong so many times. Ive seen it before. REALITY ALWAYS CATCHES UP. NAZ crash here we come. Bears prepare to be rich, heavy resistance is gonna drown the market.

-Anon who used to be in trouble but richer in the future.

costas1966 said...

CME another shortable stock over here. Hte 3 days rally had barely any effect on the stock now it will fall appart

Anonymous said...

JUST SCALPED ebay for 5 cents ha

Trader 2006

Anonymous said...

"Think of it this way: SOMEBODY had to be selling their shares over the last 4 days"

_____________________

That's entertaining, considering you're posting this on a bear site. Ever occur to you that selling and short selling look alike?

10:32 AM



Now let's be reasonable. You can't use the argument that this rally is fueled by short-covering, then come back and say that all of the sellers in the last 2 days are short sellers!

So which is it? Short covering or short selling? You can't have it both ways. I don't know of one single short that covers his position, then reshorts immediately.

10:40 AM

======================
A.) That was my only post of the day (until now). I didn't "come back" and say anything.

The selling would be comprised of daytraders taking profits, and retail shorts who can't take a hint.

Nasdaq short interest is at an all time high. In case it's escaped your attention, everybody and his dog has shorting capability nowadays, and they sell bottoms the same way retail longs ('Mom and Pop') buy tops.

Pause and reflect on the tone of the posts on this site.

Shorts used to be considered smarter than longs, because they often did much more homework on the companies they shorted. They shorted specific companies, and for specific reasons. Shorting now is just herd behavior. (Looks like Tim Knight has failed to notice that he's part of that herd.)

bsi87 said...

Anon in trouble,

Good luck. Mkt doesn't care what you or I believe. You and I don't control anything but the stock/index we price, the price we buy or sell at and the quantities.

bsi87 said...

correction

the stock/index we pick

Anonymous said...

Woo hoo! The PPT is back in action!

Look at those indices float back upward!! Slow and steady, just the way they like it. Turn on the faucets and let the money flowwwwwwwwwwwww!!

Sanjay Sola said...

Keep an eye on WIRE. it has a very bullish chart pattern.
http://finance.yahoo.com/q/bc?s=WIRE&t=3m&l=on&z=l&q=b&c=

draw your chart lines on the last part of the chart pattern.

AKAM may be forming a cup and handle chart, so watch that one too. orderly consolidation. institutions buying it lately.

do your due diligence

bsi87 said...

Looks like they're gonna play the game right up to the end. 2:30PM looked like the crack/end of the move.

Anonymous said...

Anon:
Bullish technicals are there you just missed them. If you look at the Dow we broke out of two bullish patterns yesterday 1. a double bottom that formed in the last three months and 2. a bull flag that formed over the past month. I'm not saying they are going to hold only that they are there. For the bearish, there is however a potential double top but why not wait for confirmation rather than sitting short and hoping it will form.

I'm glad you brought up the subject of technical analysis. I've been reading this blog for two weeks now and except for Tim's analysis there is very little technical analysis discussion in the comments section for a blog titled Technical Analysis and Stock Charts.

Personally, I think it would be great if people discussed what they are seeing on charts rather than talking about how stupid bulls are because they do not read economic indicators the same way they do, which I think serves no purpose other than to totally screw up your mental game which I believe is the most important part of trading.

Staying bullish until a lower low and lower high is formed.

Good luck everyone! MED

PB said...

they'll do anything to show the mkt in green!! MOFO's

the only thing comforting me is a bottle of JD's (just kiddin')

You need to ask yourself this ...
if you were a fund manager, would you be deploying the last little bit of cash you have left into a market that has a US slowdown to confront?

Anonymous said...

Aug 18 9:50 AM Mich Sentiment-Prel. Aug - 82.5 84.0 84.7 -

tomorrow economic data

Trader 2006

Anonymous said...

some tech analysis:

Looks like IGN, IGW and IGV have broken through their upper resistance(downward trend).

am I right?

costas1966 said...

1.303 billion at 15:24. Volume sucks again.

Anonymous said...

DELL goes either 25 or 19. Im thinking 19

Trader 2006

Nancy Drake said...

Yay! Yet another great day for the Bulls. Now the usually pullback and then a nice move up on the S&P 500 which is looking nice (for the Bulls).

Congrats to all of us Bulls that profited from this nice week. Smoke 'em if you got 'em.

=^.^=

Anonymous said...

Ok, here's my technical analysis for basically every stock in the market, INCLUDING the indices:

Major shooting star today after 2 huge white candles following a bullish reversal.

We SHOULD be in the red tomorrow across the board, as well as a very high likelihood of a follow-through red day on Monday.

If anyone with technical background can honestly look at today's action and call it bullish, then I'm calling bullshit on that.

The fact is that options expiry tomorrow will throw all that technical analysis out the window. The markets are doing whatever they want to do right now. Technicals mean absolutely nothing.

Nancy Drake said...

"The markets are doing whatever they want to do right now. Technicals mean absolutely nothing."

Which means your analysis previous to that statement is bullshit as well. ;-)

It'll be Green tomorrow. The Bears were wrong and will continue to be so. The market has made its turn and, sans a NORMAL pullback, the S&P/DOW will be up at the end of the year. There is no Bear market.

The Bears are wrong (as usual).

=^.^=

Anonymous said...

what is happening to the dow with 10 minutes left in the day.

Anonymous said...

Folks, I really do encourage you to pull up intraday charts (at least 5 day) and look at the price action of the indices.

Like a freight train, straight up at a 45 degree angle. No dips, no spikes, no hesitation.

Today, we saw a decline which was again, straight as an arrow at a 45 degree angle, then by MAGIC the indices started on their climb again, at that same 45 degree angle upwards.

I've been watching intraday charts forever and I can honestly say that I've never, EVER, seen action like this. Look at the typical Dow intraday spreads and action. The price action is all over the place. Spike in the morning, selloff at 11, a "noon balloon", then maybe some margin action after 2 PM, with an occasional spike or drop going into the close.

Now we see nothing but pure manipulated price action from start to finish. This is not your normal run-of-the-mill random buying action. This is pure manipulation, plain and simple.

The only hope for the bears is that people regain their senses and start selling off after the 4-5% gains in the indices this week. Or, if the shorts grow some hair on their chests and start shorting like they should be doing here up in the stratosphere.

Anonymous said...

Anon MED
"Bullish technicals are there you just missed them."

And perhaps so did 99% of everyone else.

"If you look at the Dow we broke out of two bullish patterns yesterday 1. a double bottom that formed in the last three months and 2. a bull flag that formed over the past month."

Easy to point out after the fact. How come no one brought this up before?

I'm not trashing TA - I use it a lot. Only want to say that the patterns are subject to interpretation (you see what you want to see), and do not hold when there is major market manipulation like this week.

PB said...

Nancy Drake said...
Yay! Yet another great day for the Bulls


Yay Nancy! go to a bull site why don't you!

what was so great for the bulls today? You bulls are a bunch of herd animals ... follow the leader off a cliff! We'll be there to pick up your carcass!

CIAO!

Anonymous said...

The old axiom that the market loves
to climb a 'wall of worry'is
holding true once again,and
judging by what I'm reading today
on the blogs is that there is still
a lot of worry.In fact the higher
the DJIA goes,the higher the worry
levels are getting.I would have to think that at least until Sept.11
has passed,no major selloffs.That
date has almost become like a new
July 4th for the markets.A new high
on or around 9/11 would be symbolic of our resolve.The psych-
ology of all this is equally as
important as the technicals.

Good Luck to all ! C.H.

AT said...

Dell crashing in AH.
Tomorrow will be RED.
The manipulation has to end.

walter said...

today neutral to bad for bulls, as the indicies are pushing higher, the volume is fading...

walter said...

dell not good for bulls

AT said...

MRK down nearly 6% ($2.35) on adverse court decisions. Where the technical analysis did that come from?

Anonymous said...

Anon
obviously 99% of traders did not miss it. and the fact no one on this site brought it up is exactly why I made my comments earlier.

i'm not biased either way. when i see a higher high and higher low at potential area of support i go long. when i see a lower low at resist. i go short. if tommorrow we drop below todays low i'll go short. i've learned my lesson not waiting for confirmation and trading what i think is going to happen.

i think everything else is just noise. i may be a simpleton but i don't buy conspiracy theories or believe i'm smarter than the economists at Goldman.

MED

walter said...

check out this blog post regarding recent rallies and their associated volume - very interesting

http://bigpicture.typepad.com/comments/2006/08/wanted_volume_p.html

stockshaker said...

fellow bears. nice rants. I love it.

but you KNOW things are not in favor, when we have to start saying that there is "price manipulation" that is causing this new bullish cycle.

c'mon guys.

like you, I would love to see this puppy fall like a rock, but theres no way we can just ignore what has been going on.

OF COURSE, you'll see volume get a little less, ITS BEEN THREE DAYS OF PURE GAINS! of COURSE you'll see some selling tomorrow: WE HAVE HAD THREE DAYS OF PURE GAINS!

There is a systematic selloff that will happen, but now our huge resistance (spx:1280) will now be a huge support level. and if I were anyone on here, I would appreciate when we are wrong (I TOO AM INCLUDED, because i had puts all across the board), and look at this next price action toward teh support as a time to get rid of your shorts, before the indices start moving back up.

Anonymous said...

For those of you looking for shorts, here are a few:

ESLR
F
AAPL
VOL

ESLR should drop back into the mid to low $8 range.

F needs to retrace. It's way too overextended there.

AAPL, well what can be said there. I guess the potential is there for it to go back near $70 for a double top, but I just don't see much left in the tank on that one.

I was lucky enough to get VOL at $43.75 today, but there's still a ton of downside left. It got rejected by the 50-day SMA and is right at the top of a downward trading channel. Easy $40-37 downside potential, if not more.

Good luck.

-Tony

Anonymous said...

Stockshaker: You're right about the support. I think we've gotten past the panic stage and are once again trying to make a new a bullish trend. A retest of the previous resistances would prove that.

Dow 11,250
S&P 1280
Naz 2100

Good targets to cover shorts and switch to the longside if the technicals look right.

-Tony

Anonymous said...

Hey bsi87: How are you shorting the RUT? I see you can buy puts against IWM, but is there a short ETF?

Thanks.

-Tony

Anonymous said...

There are alot of poor traders here. Some continue to refuse to acknowledge this breakout to the upside. You either learn to trade or GTFO.

Market is up 350 points since monday and we have alot of folks yapping about the coming crash. Unbelieveable!

the trader II

downosedive said...

Your marketmakers (yeah ok Im a Brit) will now start to cover themselves by opening with prices marked down slightly and from then on it will depend on whether there is any selling across the board, or whether trades are roughly equal buy/sell or indeed whether they are more on the buy side (should be inconceivable at these levels). The VOLUME doesnt have the be high in either direction to move the market one way or another. The marketmakers will seek to balance supply and demand for shares by varying the spreads they offer in accordance with their liabilities to settle any outstanding trades, and their existing holdings of shares in relation to actual and anticipated demand patterns from buyers and sellers. They are literally like wholesale traders in an open market. They buy and sell to each other as well as buy and sell with their customers. They dont want to be left with too little stock to sell or too much. They trade 'on-credit' (by commiting to buy and sell) without actually having to always own the eact quantity of shares - any shortfall are settled within marketmakers intra trading agreements governed/approved by the NYSE. Can you see now where the sudden mark ups and mark downs come from? Sometimes the marketmakers react to absolute volume sales or purchases, other times they can in effect set the trasding pattern in motion without any meaningful volume having been traded. If they get it wron then they either have to finance selling too many shares below the final trading periods closing price and have to buy the excess at a higher price than they sold ie they make a loss. OR if they mark their prices too high, they simply wont be ble to trade....because.....there are several market makers for each companies shares, so when a buyer gets a quote to trade a share the spread reflects the most competitive buy and sell price offered from the sum total of all the market maker for that share. Often they quote the same spreads for the larger companies, but more variable spreads for the mid and small cap companies. Can you all see now, there is no conspiracy theory going on, no Fed interferance and no political agenda, other than naturally none in power intentionally wants to be in charge of a failing economy so of course they would like to paint a rosey picture when things are bad, but NOT actual seek to interfere with free market forcces. Only the NYSE interferes with market forces by having the power to suspend all trading of the DJA falls more than x number of points in any one trading session (it used to be 200 points post 87, but has now been changed I think?). So what you are seeing is market makers pushes prices UP, finding a steady amount of buyers (NOT exceptional, just average) and very little sellers of actual shares. Now after such a mindless rally, the marketmakers will start covering themselves by lowering their prices but only if and as long as, the sellers outweigh the buyers. If the two roughly match, prices stop falling, if buyers exceed sellers the prices start rising. Dont suppose anyone will actual read this post, but heck at least I tried! Do at least bear in ming - I trade only the DJA futures (I dont trade the UK markets)

Anonymous said...

"There are alot of poor traders here. Some continue to refuse to acknowledge this breakout to the upside. You either learn to trade or GTFO. "


How easy it must be for you to sit back after 4 straight days of absolutely HUGE gains and say that we're "in a breakout."

My 5-year old son can tell that much from the charts.

So other than flapping your gums, exactly what is your point?? That everyone should be BUYING right now? Or should we be selling?

Did you see this coming? Somehow, I don't recall anyone (maybe with the exception of Eddie) who was saying anything even REMOTELY bullish. Eddie actually was calling for S&P to 1300 while it was still at 1262. Great call.

You, on the other hand, are doing nothing at all, except stating the obvious. Of COURSE we're in an uptrend. The point is not to identify it AFTER THE FACT, but rather the point is to determine exactly what to DO about it right NOW.

And right now, the upside SEEMS limited. Nobody knows when the rally will end or what will happen after it does end. Will it continue sideways? Will it drop like a rock? Will it just keep going up and up and up every single day?

Since you seem to have all the answers and have the balls to call everyone here "poor traders," I am keenly interested in your outlook for tomorrow and next week.

Please enlighten us imbeciles.

-Tony

Sanjay Sola said...

market needs a little bit of pullback. better play it by ear and be flexible. retail numbers aren't bad and oil is falling. market will fall apart, but it might be when the Fed says they will stop.

we're getting some decent breakouts now. Digital River, JC Pennys, PWEI, AEOS. they are all holding up.

HITT looks really nice here. volume is good
http://finance.yahoo.com/q/bc?
s=HITT&t=1y&l=on&z=l&q=b&c=

FORM might be in a cup and handle formation.

http://finance.yahoo.com/q/bc?s=FORM&t=1y&l=on&z=l&q=b&c=

WIRE, AKAM, MDR. have nice uptrends.

bsi87 said...

Tony

UCPIX. You can use IWM but UCPIX is a 250% short and no risk of margin call.

stockshaker said...

Tony, I like VOL a lot, lower highs, beauty.

but dont' you think the downside is limited to a pretty good support at 40?

Im still keeping my eye on FDG. Today, POSSIBLY could be a small breakout from its downtrending channel, but its a really disgusting candlestick today, which would not be a great bullish indicator of a breakout.

downosedive said...

Volume is healthy, suggests buyers and sellers in reasonably equal balance based on this. Cant draw anymore than that, so not much guidance as to where its going to go now (based on volume). Based on any other measure, hell noone knows. Everyone is just saying where they would like things to go. Weve all been thrown by the lack of any dominant selling, just bugger all. Im distraught

Anonymous said...

stockshaker: It MAY have support at 40. It certainly has been a bit of a stumbling block for the shorts at that level.

But Heck, if it does get to 40, that's still a 5% decline from here. It's worth a shot, especially if you look at the poor volume on the latest "run". I plan on covering near $40 and if it does break through, reshorting as close to $40 as possible, depending on the volume and price action.

Or cover at 40, if it reverses, go long back to the top of the channel for another 5% upside. Doesn't really matter much to me. I just don't see it breaking $44 anytime soon. It reminds me a lot of TRLG, which ran from $15 to $24, only to fall all the way back to $15 again eventually.

There hasn't been any price "cover" on VOL since $30. I'm hoping it breaks $40 and continues down in through September/October.

Good luck.

-Tony

bsi87 said...

From IBD.

The IBD 100 fell 0.7%, faring worse than the major indexes. That marked the fourth straight day that the IBD 100 has closed with smaller gains than the broad market or posted losses on an up day for the indexes.

Typically you'd like to see top-rated stocks, such as the ones tracked in the IBD 100, fare better than the broad market. But many of the IBD 100's stocks are oil-related and have fallen hard lately.

It will be interesting to see how the IBD 100 fares in the coming weeks. Many of the leaders of the past few months, especially in the energy sector, have shown late-stage bases or other bearish chart action after long run-ups.

Also note briefing.com

Looks like a number of issues are being taken out back and shot AH.

bsi87 said...

HPQ

Looks like a climax run to me. Sell short limit order at 36.66 good for the day.

The Russell 2000 looks like a descending right triangle. Base is at 670. It tried to break thru the descending resistance line but was turned back. See what happens tomorrow.

Tops are a process, not an event.