Friday, April 13, 2007

Deep Dive

With ten of the past eleven stock sessions up, I feel the need to step way back and take a broad look at the market. I want to look at industry groups, do some scans, and basically take a fresh look at the market.

I'll have something this weekend. I don't want to rush an entry out today. Things are acting just too weird for a quick afternoon post. Visit me this weekend.......

25 comments:

Stimit said...

Tim - can you please cover how the trading volumes and money flow is doing. Today's action looked like a short sqeeze prior to options expiration to me. But we are so close to all time highs and there is still no desire to lock in profits..that makes me real wary!

Thanks a lot for taking the time to post.

Tom2oc said...

Tim, looking forward to your analysis to compare notes. Don't miss that large cup and handle pattern from April '06 to Nov '07 though. Good luck!

Best,

stock_trad3r said...

Get rid of Anonymous account postings.

Anonymous said...

Tim,

I think that's a good idea that you take a fresh look at the markets.

I can share your so-called 'permabear' thoughts but I have to admit that being a professional trader, you haven't really adopted the 'trade what you think' attitude over the past few weeks, which is kind of ironic since you are a technical analyst. I think your 'wanting' of the markets to crash has clouded your judgement. Could the markets collapse later on? Absolutely, but neither myself nor you can predict that.

I am HUGE proponent of trading what you see, not what you think and the fact remains (at least for the time being) that the market is going up. There is no way around that (unfortunately!).

I am an avid viewer of your blog and appreciate you taking the time to post your thoughts. Please don't take any of this as negative criticism. In my own trading, I have caught myself many a times in situations just as this but trading based on what you want, or what you think is trading incorrectly as you appreciate.

Cheers,
Alex

Anonymous said...

Hey Tom2oc, what's happening with that cup handle on AAPL? Looks like it's melting. Or is that a sloppy Head & Shoulders?
Gunner

Anonymous said...

stock trder why are you posting here, stick to elitetrader....

your too bullish, wait till the market takes a big dip and your there holding your long postions in the next bear market.

Anonymous said...

markets are soooo overbought its not even funny. The yen carry trade is holding this market up. Once the yen carry trade disappears your going to see a nice wave of selling across every market around the world. Dow is up 10 out of 11 days. What the hell is wrong with this picture. Amazing that everyone thinks the market only goes up. Wait till it starts its next sell off and everyone who buys the dip only sees the market drop even further. This market is completely irrational and its quite pathetic that many dont even see it that way.

Ravi said...

View on AAPL. I am short the stock. Please see the divergence on RS. A logical bottom would be around $75. Same with COH.

I think, the energy stocks are hiding the market weakness. Too unfornate that BOJ did not raise interest rate.

Carry trade will stop. Question is when? When it does, Feb 27th will be replayed once again. Every asset class is so risky right now. Can they go up, ofcourse..

We will wait..

Geoff said...

Tim,

I'd be very interested to know how you "step way back and take a broad look at the market." I'd like to know what you look at and what you're looking for when you do this. Obviously I realize this would probably very time consuming so I understand if you don't, but if you're looking for something to write about I think that would be cool to see.

I find your blog very helpful and think you do a great job on it either way.

Sqroot said...

AAPL - look out, it printed a hammer today !! Agree totally energy is making this pig fly.

b.healed said...

I am very interested to hear the process that you went through in your reassessment of the market. Also, I am very excited to have seen you decide to step back and take another look. I was starting to think that this was a bear blog and not so much a TA blog. That really brought a feeling of balance to this since I am so new to reading this. thanx

tradertime said...
This comment has been removed by the author.
stock_trad3r said...

So your thankful for 'helpful' advice even if it is wrong advice? That makes a lot of sense.

Anonymous said...

"If anything, do not fight this creeping trend by betting against it. That behavior is exactly what keeps the trend oozing (by shorts covering)."

from afriadtotrade.com

knowledge is necessary for wisdom, but not sufficient for it. Wisdom is attained out of one's own self disgust for stupidity.

shorting oil soon

humble

wincity said...

Tim,

I'm afraid of you turning into a bull just when the market is about to reverse into a bear. The craziness out there feels exactly like the days before Feb 27th. I doubt this would last.

China has been up 1% a day for a month now. Will it be a trigger again?

And the craziness of oil stocks. At this price, I doubt they'd move up on any news, no matter how good.

IMO, the market has topped. It's too late for the bears to remake themselves.

Anonymous said...

I wouldn't give up too quickly on a market turn. Possibly what we will soon be looking at is divergence of indices at a retest of the Febuary highs. Those Feb highs are really major resistance and would need to be exceeded for the Bull to continue. With a lack of follow through,it very well could turn out to be a double top on the charts that could hold for many months to come.

Just my .02 cents worth

Ken

gary said...

Watch the dollar. The last time the dollar collapsed through a major support level the Fed had to step in and raise interest rates to protect the currency. That was in May of last year. Interest rates are rising as the dollar sinks again putting more pressure on housing and the economy. The dollar will be the key. I don't think the Fed can let the dollar fall apart. They will start soon with the hawkish talk. If that doesn't work I think they will be forced to raise rates.

Anonymous said...

Tim,
Thanks for the book and your comment. Waithing for your weekend thoughts.

Meanwhile, my tow cents here:
markets have changed psychologically. More people and more $$ available. And most of them by nature, long only. So, every sell-off be fast and furious, met by new comers with money. As long as no major events outsied of market, psychology of markets worldwide is to buy dips.

Fundamental stuffs like inflation, interest rate, Federal reserve policy, etc. causes opportunity for folks to buy dips.

To me current opportunity is for Indian market to make a new high. Accordingly, I've a position in INP, India stock market ETN. I've read, only 3% of population among middle-income group are in the market compared 55% of US household is. So more people with money are not in the market yet. That's my logic for going long.

Compared to past 20 years or so, lot of folks are coming into the market worldwide. As long as more people are coming in, worldwide stock markets are going up. Imagine, if US market drops 5% now, so much money from around the world out there, will jump in right away.

This can only stop, if across the world savings rate at banks jumps to 10% or so.

Thanks.

Anonymous said...

Yen carry trade status and the impact on the S&P 500.
www.10sigmaevent.blogspot.com/

I just wrote this one, what I found was that we are at a very critical juncture here on the yen carry trade and the S&P 500.

Tim I hope it is ok with you to promote my blog although I have nothing to sell just knowledge sharing.

zeus111

beanie11111 said...

When Doug Kass capitulates, then we go down hard.

lol

ross said...

Whether it is meant in jest or not, comments like "when Doug Kass or whomever capitulates then we'll go down hard", are just silly. What some individual's position on the market is, whether they be permabull or permabear, amounts to a meaningless quarter blip on the radar screen.

So lets get down to brass tacks. Here are a few truths:

1.) It's still a bull-since '03 that is.

Why? Price, price, price.

2.) It's a bear-from '00 that is.

Why? Again, price, especially in REAL TERMS.

3.) The short term has been bullish. Duh!

4.) The intermediate term's been bullish.

But here's why Bulls should not (against their usual obnoxious tendency) be cocky:

A.) Rising wedges, a pattern which the major averages appear to be in, are uniformly bearish with a high probability of playing out. We are now at the make or break point with this one. The odds are that market breakdowns very soon, or we get an overthrow first and then a breakdown.

B.) The entire advance from the March lows is on steadily declining volume and with a few exceptions, such as in the case of volume spikes in capitulation and blowoff moves, VOLUME LEADS PRICE.

C.) There's a Bradley turn date on the 20th. The Brad has been decent of late which either way you slice it means lower prices are close at hand. The time window on the Brad is a day or two.

Leisa said...

Without regard to whom I weird out by this post.....

The market v. the fundamentals is asynchronous. Asynchronicity means that the Earth gets wobbly on its axis and that cannot be good for the markets.

TradeitLikeItIs said...

Leisa

Asychronicity is not that weird... and it aptly applies here - to markets that is.

With asynchronous markets things can happen - well - whenever they happen!

In synchronous markets (control and insider manipulation) things proceed in lockstep.

The stock market embodies both of these extremes - and all points inbetween - but probably tends to be synchronous until the insiders get hit over the head with something unexpected that even they did not plan for.

In general there is an inverse relationship between synchronicity and the expected results in the market (ie: it is going up, it is going down)

If things happen in a 100% predictable order ie: market rises along fine channel lines as everyone expects - asynchronicity is near zero.

When asynchronicity happens (ala Feb 27) etc... no order can be expected.

Typically order or some expected market result (say a crash or a peak) is expected within a particular wait time.

As more wait time elapses between the passed expected time and the NOW, the situation tends to asynchronicity - and there is a greater and greater sense of urgency (it has to stop falling or it can't go any higher)- something surely should have happened by now!

Weird out on that.

TradeitLikeitIs

beanie11111 said...

the billion dollar funds use astrology!

http://www.thestreet.com/_yahoo/markets/marketfeatures/10350360.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA


J.P. Morgan, the 1900's financier, did; he said, " Millionaires don't use astrology, but billionaires do/"


booyah!

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