Thursday, December 14, 2006

The Rich Get Richer.......

Well, the bull's commanding grasp of the market is not loosening. The bears have been - as the kids say - "pwned!" It's painful. It's relentless. But it's real.

One reader has sent me a "domed house" graph of the market (a couple of times), predicting a reversal in the Feb/Mar timeframe. Hey, that prediction is as good as any other. Here it is.......


I'm just waiting for the insane press and books of the late 90s to return to us.


The MidCap 400 is one of the few indices that hasn't blown into full breakout mode, but it's close. Just a whisker's breadth away.


The NASDAQ 100 ($NDX) is actually relatively weak, in spite of a strong showing today.


Here's a much longer view at the market, this via the S&P 100 ($OEX). You can see where I've drawn the Fib retracements. Today was a blowout bullish day. It is visible even from this "height."


And here's the broader S&P 500. The bulls have been totally in control for five solid months now. You can just about lay a ruler down from mid-July to mid-December and see the market zoom straight up. Ugh.


The $VIX, which was in single digit territory a couple of weeks back, has returned to that astonishingly low level. The $VIX had risen for a bit, given us poor beleaguered bears some hope, but it's come full circle. Is it theoretically possible to below into negative numbers? I suppose not.


Here's a closer look at the $VIX.


Finally, the $XMI was the earliest index I made a bullish call on (begrudgingly), and its super clean pattern continues. A burst up from a saucer, plain as day.


This is probably the first time I'm pointing out more "Buys" than "Shorts", but - - if you can't beat 'em, join 'em. I've got six ideas for you bulls out there. AKAM has been profoundly strong and is in new high territory:


BZH, mentioned many times already, is worth a new look:


CRVL has been superpowered by surging volume.


PWAV seems to be turning the corner as well, after a long fall:


Here's PXP:


And, finally, Redback (RBAK), mentioned many times. The volume is terrific, and this is up about 35% from when I first pointed it out.


Now, for those insane enough to be bears (like me) until their dying breath, a few short charts. CTX:


John Deere (DE):


Lehman Brothers (LEH) which, in spite of blowout earnings, actually fell on this +100 point (on the Dow) day.


MEE, an energy short:


I sure must have been a lot more fun to read in the summer when I was full of P&V. At this point, I'm just showing up, hat (and charts) in hand. Grumble. Being a bear really sucks.

26 comments:

Anonymous said...

Trying to catch the top of these markets that are artificially floated higher by increasing amounts of M3 and foreign liquidity is impossible.

How can you possibly compete with a government/financial institutions that can pump virtually UNLIMITED amounts of money into the markets?

If "They" want the markets to go up, they'll go up. When they've made enough profits, they'll pull their money out and sell their shares to retail chumps at the peak of the markets.

But since they NEED retail chumps to continue to dump money into their funds, they can't let them fall very hard.

It's a game. Play the game WITH the crooks, on THEIR SIDE, or stop bitching. Crying about why the markets are going up is fruitless. Either go long and get on board or else just stand aside. But betting against the multi-trillion dollar financial industry and the money-printing Fed is just plain suicide.

Anonymous said...

Repeat after me everybody:

1) I will never fight the trend

2) I will never fight the Fed (low interest rates)

kapiche!

Chris said...

you want weak look at smh !

yup ya got to trade price and the DOW is pegged to 12,400 for options tomorrow.

CPI that should be rosey as always ( all govt is) and then monday well its a new week.

i am bullish on QCOM as the party continues.

Anonymous said...

INVESTOOLS PROPHETCHARTS WISH LIST
1) CandleStick Pattern Recognition
2) Advanced Elliott Wave Analysis
3) Swing Indicator: Test of Top/Make or Break
4) Price Headley's Acceleration Bands

INVESTOOLS SEARCH WISH LIST
1) Ability to search for stock with three closes below 50 day moving average in a six month period.
2) Ability to search for stock option with 2 consecutive closes above 10 day EMA or 1 close below 10 day EMA.
3) Ability to search for stock which meets potential Test of Top/Make or Break swing criteria.
4) Ability to search for stock which has closed above or below its upper Acceleration Band.

cwo

Anonymous said...

Hey CWO,

As far as candlestick recognition Stockcharts.com has a FREE search for candlesticks.

Doug

Anonymous said...

Hey all you bulls!!
Have I got a great buy for you!!!

Ticker is is SHIT

Trades on Nasdaq, has no earnings. It finances crack for inner-city bums without any paper work or down payment. It's actually one of those stocks that makes money no matter what happens in the economy. If the economy is good, people buy crack cause they feel good. When the economy is weak, people buy crack to feel better. (It could actually be argued that a weaker economy is better, because more people would buy crack to feel better) Goldman Sachs and all the other big money institutions also have long term contracts with SHIT to supply their traders with it.

DOW 95,000 here we come. Let's light up those pipes and buy stocks like they were free! Hang on, they are free!! The FED gives us a few billion each day to prop the markets up. Do we worry? NO! This market is going to the moon!

Anonymous said...

I have been extremely bullish this year and feel DOW 15,000 is just around the corner. Probably will happen by next Halloween.

sage08 said...

the doom house is a pattern which can be superimposed almost at random.. i had someone superimpose the pattern from sept to nov and declare tht the mkt will crash in dec..

i've converted to a short-term bull very recently and hv since made some gains.. tonight cpi is where all the rage is abt..

z-stock said...

It looks like 1998, The dow went on a 5 and ¾ month march straight up. Very similar to the 2006 march. It finally ended with the Dow falling 200+ points in one day. In 1998 the dow climbed 21% before the 200+ bear day occurred. This 2006 run has climbed 16%, and is 5 and ½ months along. One more week to go, and it’s match or break the 1998 record.
z-stock

Anonymous said...

It's " domed " house pattern, not " doomed " house! Talk about a Freudian slip! Listen folks this raging at the Fed and this printing of money that may help the leveraged buy outs but that doesn't buy stocks! It's really quite simple, pay attention... Stocks began going up when housing began going down! Disingenuous high finance types and old money wealth who were fed up with 5 years of a go nowhere market began piling all their spec money into condos and real estate and art!
Now they are back to buying stocks. Should the art market crack- ironically, it will bring even more buyers into the stock market- so what we have is a very interesting situation- the more the real world cracks- the more the paper world goes up!
When housing roars again suprise stocks will be stuck in the mud.
Also, If you trace the domed house pattern out a little further I believe you see the profile of Bart Simpson! Happy Holidays- the stonedinvestor

Anonymous said...

The markets are on fire. PreMarket gap up and time to buybuy as Jim Cramer said.

Anonymous said...

WOW!!! Whata CPI release for the enf of year!!! Inflation is lowering. Maybe - just maybe you stubborn bears have missed many months of some great gains. Love you like brothers and sister but..... how long do you stay glued to the floor refusing to get up?

Merry Christmas and a Happy New Year!!!

John

Anonymous said...

we all know CPI is a sham! Just a simple look at the commodity complex will tell you that inflation is more than 2% per year. I think this market has blinders on and is not accounting for properly for all the risks out there.

The US has been in Iraq for longer than it participated in World War II

pepsi

Anonymous said...

Well, this morning was the final nail in the coffin. I wouldn't be surprised if the Fed does achieve a soft landing. I don't see these markets going down. There is simply no fear for investors, and they have the 100% full support of the Fed backing up the financial institutions. Manipulation at its finest.

I agree with the lack of bearish sentiment here. The markets will continue to rise, regardless of economic outlook, because there is nowhere else for the tremendous global liqidity to go. It will continue to go into paper (stocks) until something better comes along.

The only reasons stocks went down in 2001 were "fear", housing bubble, commodities bubble, and profit-taking from the 1990s. There are simply no such catalysts today. Any negative news or downturn in the markets are a buying opportunity, plain and simple.

I'm afraid this will be a repeat of 1995. Which means we have at least 4 or 5 more years of this nonsense before people pull their money out. And if the Fed starts cutting rates in 2007, the markets will be even stronger.

The big guns will not be satisfied with a 10-15% return in equities this year. They won't sell until they're good and ready, which means not until the markets go much higher. Much higher.

Tim, I appreciate your effot and charts, but the sentiment is way off. Yes, bears can make money, but not in these markets. It's a waste of time trying to go against the grain when you have literally trillions of dollars working AGAINST you, trying to take your money, any way possible.

I won't be visiting this blog anymore. It really has hurt my trading, to be quite honest. I should have known better, but hey, any lesson learned is a valuable one, even if it's a little too late.

-TonyB

Anonymous said...

Tony,

I commend you for your courage but.... There will always be indivudual bear plays as they there will always be individual bull plays. I do not condemn Tim or his "fellow bears" but I do think they have been left out of realizing any real gains this year because of their stubborness relaize that a trader follows a trend not a thought. As for the political posters who love to live here in the bear cave? I hope you have a nice long hibernation as you continue to dream of conspiracies and proped up free markets. Have a nice winter!

I wish you the best Tony and hope you get your trading back on line.

John

Anonymous said...

fundamentals don't matter in this market!

keep in mind, SUPPLY and DEMAND determine stock prices, nothing else.

DEMAND side is surging with dollars being printed like its the end of the world.

SUPPLY of stocks continues to fall with company repurchases and private equity taking out whole companies.

DEMAND UP

SUPPLY DOWN

= PRICES UP

as much as we bears don't like it, that's the reality!

Michael Newton said...

"This is probably the first time I'm pointing out more "Buys" than "Shorts", but - - if you can't beat 'em, join 'em."

A sign of the top?

And VIX down below 9.5. I may be young, but I never though I'd see that happen.

BTW, I'm starting to think the market will close down today.

Anonymous said...

Look at the bright side of market.

There are so many fat pig to short.

That is if you are still survived so far.

short AKAM, NVDA, FFIV, TTWO, CAL, RIMM, XOM,X, T

Anonymous said...

Why do my charts show a gap up at the open on $spx and a gap down on spy?

Anonymous said...

maybe I should stop reading this blog too. behavioral finance guys call it confirmation bias. you tend read things that match your ideas and then feel that you are correct.

Anonymous said...

9:48 am

Right On!!! It does affect your thinking. I suggest minimal at best for reading any Blog.

John

Anonymous said...

im with tony, today was it. Today was it for the bears, forget about any decline anytime soon. Only thing will see is a 1-2% decline. Nearly every analyst has raised their estimates for the s&p. Today another major bank raised their 2007 dow estimate from 12750 to 14000!!!!!!!!.

I think will see 13000 before 12000, thats the game. Complete manipulation.


depressed trader 2006.

Anonymous said...

Some observations I am seeing. Market breath is down and basically at this point in time the market gains are all GE related. Some leaders are struggling IE, goog, bidu nyx crox cme. Investors intellignece bullish sentiment is 60%. I tink the market is losing momentum.


Zeus111

Anonymous said...

This is eerily similar to what happened only 6 years ago. Today cnbc dude was pumping an OTCBB stock (IFLI). It is some fight club thing that has a huge market cap now. Some people never learn. They were laughing at how it ran up so many points before they mentioned it. Looks like someone tipped them off to pump it beforehand.

Anonymous said...

I cant believe the network fell for that. Some hedge fund manager got the story to air. This is a bubble folks and it will continue higher until there are no more bears and only suckers left.

Anonymous said...

Monday, May 01, 2006
Former bear turns bullish on global economy
Is this the final bear capitulation phase ?



The world economy may be able to unwind its current imbalances without serious disruption, Stephen Roach, Morgan Stanley’s famously bearish chief economist, predicted on Monday, in a remarkable revision to several years of gloomy prognosis.

Mr Roach had long warned that the US current account deficit and Asian central banks’ ballooning currency reserves risked destabilising the global financial system.

But on Monday, in a note to clients, he said: “I must confess that I am now feeling better about the prognosis for the world economy for the first time in ages.” His comments came as the dollar hit a one-year low against the euro and seven-month low against the yen, as investors remained confident the US Federal Reserve was nearing the end of its interest-rate-tightening cycle.

Mr Roach said the tipping point had been last month’s decision to mandate the International Monetary Fund to begin multilateral discussions with the aim of resolving the largest trade imbalances. At the same series of meetings, the Group of Seven highlighted the need to address the imbalances, underlining policymakers’ apparent resolve.