Friday, March 30, 2007

Shoving Match

The bulls and bears are really starting to hate each other. Today was a total shoving match. First the market blasts higher. Then it does about a 150 point reversal. It ends the day basically unchanged. Just look at the action over the past couple of weeks. You can see where the bulls and bears are starting to brawl at the red and green markers I've laid out.


The first quarter of the year is over, and in the coming weeks we can look forward to earnings season - - to, once again, see if there is anything that will give this market some direction. If you believe it has direction, you're wrong. Let's examine the percentage change of the major U.S. indices.

The Dow 30 - three months of trading - and basically unchanged.


The NASDAQ - basically unchanged.


The S&P 500 - basically unchanged.


Even the Gold & Silver index ($XAU) - basically unchanged. What......a..........bore!


I'm going to let my massive post from yesterday stand on its own. I'm charted out. The week's done. Enough charts for now!

Finally, I was surprised and disappointed at the absence of comments from yesterday's video. As your punishment....Christian Clown College: Part 2.

34 comments:

Leisa said...

Toshi
Yesterday's clown video (I'm not watching this one) was neither sad nor depressing, but rather it was uplifting in that it showed human compassion. Here's a video instructing people who clown as either a vocation or avocation, easing the physical and emotional isolation of elderly people.

Some things can be mocked because they deserve to be. I think you could find a greener pasture than this one. It's okay if you find this disconcerting--no worries, for you are automatically entered into my pillow of mercy program--at no charge since I've learned so much from you.

TOMTHETRADER said...

Tim ,
What a matchup ..the Bulls V. BEARS in APRIL...what could be better. I think I have talked to more Bears in the last week than i have in over 19 yeras dating back to Novemebr 1987...and we have had a 5-7% correction in most indexes ...more in most stocks. So with the earnings season coming and the bar set so low even WEEE - Man could jump it ...isn't it time to say the Bulls can have April ?? Just kidding my gut tells me there is more bad news out there but it was the perfect storm for Bears this week and all they were able to accomplish was to stop weak hands in the options market out. So with respect ..I am now back to extremely bullish and with that close on the IWM ( man that had to hurt !) up.4%..I can't join the doom yet...maybe May May we can get the Bears back into the game ???

The Book is better than a Swedish massage !!!!

http://www.ttthedgefund.blogspot.com

TTT

John said...

I am commenting so you will have at least one comment. No more Clown videos please. Thanks

Tim Knight said...

Wow, what a bunch of sweeties! This is more typical of the reaction I see:

"This would frighten the hell out of me if I was an elderly person. Not because I would fear the clowns, but it would mean my life had totally degenerated to the point where 'christian clown / mimes' are supposed to make me feel better. I'd rather be eaten alive by alligators than be bedridden and forced to endure this stuff ..."

Leisa said...

I'd rather be eaten alive by alligators than be bedridden and forced to endure this stuff ..."

That is why my pillow of mercy problem will earn me big bucks with this aging population. So if you see a clown with a pillow (and you are actually enjoying your life) be afraid, be very afraid.

mde said...

Thank you tim the bear. No more videos please as they really make the blog seem cheap.
The market will rally next quarter and most likely put in some large gains ( >9% avg) based on my bull market statistical model. I hope you load the boat with your spx puts so you can get smacked around some more.

Vic said...

tim , keep the videos coming. they reveal a side of you that I like. i bet you grew up watching monty python. it has been a boring market. I miss old Greenspan, he was a bears Godsend. Unfortunately back then i was a buy and hold type of guy. nOw I am ac/dc and we have big Ben who likes to print money to soften his blow. Just damn!

Dougo said...

It's great if some people find such a clown visit benificial.
It just plain creeps me out.
Question Tim: On the CAL chart do you see any possibility that the last 3 months are forming a falling wedge? Or is the fact that it is just coming off a (nice) head and shoulders grossly outweigh any chance of bullishness?
I already made my money here and got out today but will be watching...

ctkwtk said...

Tim, is it only coincidence that when the markets bottomed last July, oil peaked. In case no one has noticed oil is up. Perhaps in anticipation of our new and improved version 2 (or is it 3?) of war on 'terrists' (Iran). XLY/USO. Do we get back to the oil up/markets down scenario?

JakeGint said...

On the clown thing. Sure, it's kind of creepy, but clowns ANYWHERE are kind of creepy. Steven King wasn't exactly inventing the Zeitgeist when he drew up the terrifying monster (to kids!) of "It."

That said, it's kind of lame to poke fun as some nice people who are going out of their way to try and brighten the day of a bunch of old folks who are usually left to rot out their lives.

Don't want to sound moralistic, and I've every piece of IP that Monty Python every produced. This ain't it, folks.

Tim Knight said...

"The market will rally next quarter and most likely put in some large gains ( >9% avg) based on my bull market statistical model. I hope you load the boat with your spx puts so you can get smacked around some more."

Hey, MDE, I'll make you a deal.

If the market gains 9% or more in Q2, I'll shut down this blog forever.

In return, for the entirety of Q2, you won't make any comments.

Deal?

plunger said...

i dont know which is creepier, the clowns or "leisa". she weirds me out with all that pompous grammer..

any how, long time no see, tim, still a great blog, keep it up man

Archer said...

Are there, in fact, a lot of bears? Perhaps, but I submit that anecdotal evidence such as, "I've talked to more bears since '87" doesn't mean jack. Individual investors don't move the share markets and haven't for years. Clearly the economy is in poor shape, and primed to get much worse. So what will tip the share markets into an umistakeable bear posture. The realization amongst a critical number of the movers and shakers within a short period of time, that conditions are, in fact, dreadful, with no immediate improvement in the offing. With that in mind, the quake that has, of late, severely pummeled the sub-prime marts is just the beginning of all sorts of inter-related accidents that will, one by one, lay waste to most sectors of the share markets.

But, we are not yet there, which isn't surprising since the folks who make the markets move blow so much smoke up their own asses it will take far more obvious evidence of systemic distress to shake themslelves out of their terminally bulllish posture.

In the meantime, there are some very astute onlookers, Paul Kasriel, Marc Faber and a few others with decent track records, who see the handwriting plainly on the wall, and are calling it a recession a recession.


So don't be fooled by the happy talk and the seeming lack of an apparent "trend". The share markets look the way all share markets look in the early days of a bear, indecisive.. but with a decidely unsteady tilting in a southerly direction.
The fundamentals look as they do also, badly exposed balance sheets where the path of least resistance is further deterioration.

Ergo, this is no correction, sports fans, this is the beginning of the next leg down in the secular bear market that began in 2000. Yes, that all but forgotten bear market, the one that seven years on has not seen its old highs surpassed in real terms.
Put that in your pipe and smoke it.

P.S.

We shouldn't be surprised if there is one more final attempt to run the stops near last month's highs, a run I have every confidence will be nothing more than a last gasp selling op before the real hideousness to the downside ensues.

z-stock said...

HEY MDE are you talking about....Dow 12,000...up to 13,080 = up 9%....Q2....because that’s plausible, I suppose.....(I'm taking everyone's and all numbers, because I'm clueless, as to market direction)...
z-stock...

z-stock said...

Tim
Bulls versus Bears, WHO... prevails...???
Tim, If you agree to DOW 12,000..as the starting point....I think this is going to be the greatest bet of all time!!!!!..

I started adding the numbers....DOW at 12,000 (MAR low) multiply by 9%...(9% exactly equals EPS growth estimates for Q2),,..
I wind up with DOW at 13,080...sometime in Q2...

As for me, I’m clueless as to market direction...But I will say this...13,080..is very plausible, if the Dow decides to rally...into and during earnings season....

Tim Knight said...

"I started adding the numbers....DOW at 12,000 (MAR low)"

Who said anything about a March low? Where did THAT come from?

Tim Knight said...

"i dont know which is creepier, the clowns or "leisa". she weirds me out with all that pompous grammer.."

Aww, don't pick on Leisa. Personally, highly intelligent women make me weak in the knees.

Tim Knight said...

Regarding the clown videos.......

Listen, if the clowns were visiting a home of severely mentally retarded people, it would make sense.

But the people are simply old. To behave in a way that would be entertaining only to an extremely young child has no dignity. It's utterly demeaning to the elderly there.

I'm all for people cheering up those in retirement homes. I remember as a young child that I sang in a choir any number of times at such places, and it made their day. But these clown antics make the Three Stooges look positively highbrow. It's demeaning to the helpless residents upon whom these clowns are foisted.

I bet the clowns are all CNBC watchers to boot.

Leisa said...

Plunger says: "i dont know which is creepier, the clowns or "leisa". she weirds me out with all that pompous grammer.."

Plunger, I can honestly say that I've never met anyone in my life that would have ever admitted to my creeping them out. Yeah, I know I write and talk a little differently. I have a special love for vocabulary and grammar (with an "A")--it's a DNA quirk. So with that quirk I try hard to be charming company which by most accounts I've been fairly successful with.

Tim I was at the video store and saw a video-Fear of Clowns! . Thanks for defending my honor.

wincity said...

z-stock, you're creepy. How in the world did you come up with Dow 12000 as starting point? Shouldn't it be a given that we start from the closing price for March?

JakeGint said...

"So with that quirk I try hard to be charming company which by most accounts I've been fairly successful with."

Y'mean "company, with which by most accounts I've been fairly successful?"

(Muttley laugh, Muttley Laugh)

Just tweakin' ya, Leisa, don't come after me with that pillow just yet.

________________

Tim -- Call me an old line Catlick, but I give these folks points for the try, whether it's considered condescending (or merely frightening) to "entertain" with mime clowns. We all define our corporal works of mercy differently I guess, but as long as we're out there doing them...

______________

Zee -- you ineffable cheater! Why not just start at 11,500, and then the MDE Troll wouldn't have to get out of bed until July?

-----------

Second aside to Tim: Why does the anonymous screener sometimes ask me to "verify their code" twice? Is it they want to make REALLY sure I'm not AI?

junior35 said...

Hi Tim,
I love your blog.I get the impression that the small investor has no clue as to how to participate in option trading.What do you suggest is the best bway to try ones luck in options?

MarkM said...

Leisa bashing? Wow, that has to be a new low.

And I love the deep analysis of taking now-in-big-trouble earnings estimates of 9% (LOL) and multiplying it by some Dow numberto get an extrapolated market position. Tim, love your response.

Dennis said...

Well, this market is doing a damn good job of frustrating both bulls and bears. The bulls are hanging tough because they say that as long as people have jobs then they can service the debts and so far this has been the case. There is a dichotomy of the economy in this country. On one hand, the richs are doing very well thus the inflation rate is quite high. On the other hand, the poors are doing very badly because of the debts and subprime problems and thus deflation. The Fed wanted to raise interest rate because of creeping higher inflation but can't because that will only make the real estate problem worse. But it can't lower rate to help the real estate market because that will make inflation even worse. So the Fed is stuck and is doing nothing. But I have a feeling that the financials will do the tightening for them. So far we already have commodities going up (witness oil price) and dollars going down. The next shoe to drop is for the long bond to go down in value and thus raise the long term interest rate. This will compress the PE ratio of the stock market and make stock prices go down. The best case is that we will have a severe correction in the stock market (more severe than any of the corrections since the bull market began in 03). The worse case is a protract and severe bear market. I do hope for the best case because it is easier for me to make money in bull market than bear market.

Tim Knight said...

"And I love the deep analysis of taking now-in-big-trouble earnings estimates of 9% (LOL) and multiplying it by some Dow numberto get an extrapolated market position. Tim, love your response."

I notice pencil-dick hasn't said anything yet. I guess bandying about absurd predictions is shut down fast when you're asked to back it up with something.

Of course, my side of the bet is much heavier. Taking down this blog would be huge. Whereas dorkface could just sign up for another profile and continue to harass me.

All the same, the silence is telling.

Tim Knight said...

"Second aside to Tim: Why does the anonymous screener sometimes ask me to "verify their code" twice? Is it they want to make REALLY sure I'm not AI?"

I think that only happens if you get the code wrong, and it's just giving you another whack at it.

z-stock said...

This crowd is too tough for me....I’ll be happy if the Dow fails to make any new yearly highs.....
z-row....

Leisa said...

Regarding the 2x code verification--I think that it is a flaw in the program. I always have to enter it twice for my first posting on a comment (not for subsequent if I'm feeling especially chatty) both here and on R. Nusbaum's site. I know that I don't get it wrong the first time everytime.

Dougo said...

Clowns, love them,...or hate them.


http://www.spikedhumor.com/articles/19762/Like_Clowns.html

JakeGint said...

Thanks for saying that Leisa... I was worried that given the amount of times I got asked to input a second round of gibberish letters indicated I should expect a visitation of mime clowns any time now...

mde said...

I have returned after a long vacation in Cabo San Lucas due to a nice chunk of change acquired from a DNDN options trade. The deal is questionable but after sleeping on it I decided you have a deal. You will be surprised how much the markets move up this quarter and make you look like an even bigger clown. Good luck Tim.

toober said...

I can't make heads or tails. Which one of those clowns is Akbar and which one is Jeff?

Lauriston said...

The last red marker you have would suggest a target 1,400 on SPX. With financials weak today and semis looking sick, that is beginning to look quite possible. I would love to see SPX 1,400 soon. Sweet...

mde said...

Tim,

markets up big again today and you should fold that foolish bet. This website is done.

MDE:1 TIM:0