So I've decided we're going to play a game called Quien Es Mas Macho? Sorry, bad SNL reference there. Actually it's called What's Bullish; What's Bearish?
Let's start off with what's bullish.
First off, we have the SPX chart. This chart is still quite bullish intermediate-term.
The short-term SPX chart looks bullish as well, though I would expect a deeper retrace than we had. The retrace from the last couple days doesn't look deep enough to be a 2nd wave, so I have relabeled the chart. If it was a 2nd wave, then bears are in real trouble. 2nd waves usually retrace 40-60% of the prior move.
Bears will immediately notice the alternate count, which allows for the possiblity that the rally off the 1340 print low will end very soon and constitute ALL OF wave (v). This is indeed possible, but generally one would expect more from a fifth wave at this degree.
Please note my annotation regarding the bullish trade trigger. I was anticipating a deeper retracement than the market gave us yesterday -- and without that deeper retracement, I feel the potential for whipsaws around that trade trigger is markedly increased.
Also bullish is the fact that the Dow Industrials have closed the last 3 days above their 2011 highs. This is a key breakout level for the Industrials.
Now it's time for what's bearish.
First off, as I spoke about yesterday, the dollar looks bullish -- which is generally bearish for equities. The dollar continues to maintain closes above its key trigger level.
I also did a short-term dollar chart last night, and the dollar has so far proved this chart quite accurate.
Another potential bearish factor is the VIX, which basically closed right on its lower Bollinger band yesterday. This often leads to a bounce in VIX, which is usually bearish for equities. Further, the VIX has reached a long-term horizontal support zone, which may also argue for a bounce soon.
So, it's still a market of mixed messages. Unfortunately, the market gave us nothing to work with yesterday, so putting the possibilities all together on one chart looks very similar to yesterday's.
In conclusion, the market didn't give us much to work with on Monday. While the SPX charts don't look at all bearish, the dollar seems like it may have plans to put the damper on things. Unless we have another day like yesterday, these questions should resolve soon. Trade safe.
Good morning. :)
ReplyDeleteGood morning, it seems everyone is sleeping.
ReplyDeleteJoe
G'mornin'
ReplyDeleteYeah, quiet this morning. Meanwhile, the dollar just broke out above its prior swing high, and my Euro shorts are killin' it.
ReplyDeleteGood job with those EUR shorts. Not sure we'll see turnaround Tuesday.
ReplyDeleteTired
ReplyDeleteHey, I clicked the "good post" button. Haven't read article yet but otherwise I might forget, like yesterday (which was good). When I say good, it means very good, since when is your article not very good? :-)
ReplyDeletety, DD
ReplyDeleteFrom ZH...
ReplyDelete"As a reminder, China made it very clear last September that it will (somehow) save Europe, if however Europe no longer pursues trade
actions against it. Well, Europe just announced it would join the US
in the WTO case against China on rare earth metals. Sure enough, China
is about to pull the carpet from under Europe all over again. End
result: EURUSD under 1.3100 and sliding. "
PL, I put together a short macro/TA piece on the USD/JPY and why it should continue its impressive reversal further supporting USD strength. I will only post a link to the site if you approve. If not no worries at all. Didn't want to just post a link like that...
ReplyDeleteFlux and Super8 seem lining up for rally beginning 9:45.
ReplyDeleteGood morning
ReplyDeleteI think EUR has to bounce soon to min.1.32
What if VIX breakout the support? Who guess whats the target? Down to 11?
ty for asking. :)
ReplyDeleteGo ahead and post the link.
Well, that news tidbit certainly wasn't telegraphed by the charts at all. :D
ReplyDeletehttp://silversaxena.blogspot.com/2012/02/japan-black-swan-rising.html
ReplyDeleteThanks, PL. If this reversal is true, USD/JPY could potentially rally for the next year or more, which would greatly support the DX in addition to EUR/USD weakness. Once tax season is over with you'll be getting a nice donation from me as well :)
What! You mean you did not see the H&S?? ;-)
ReplyDeleteExcellent article PL. Thanks for watching the VIX...glad to see it dragging bottom. It'll make a pop that much nicer.
ReplyDeleteSo BOJ is going to do what at this point, pay banks interest to borrow overnight, one wonders when this race to bottom is going to stop?
ReplyDeleteLOL...I miss your sarcasm throughout the day... :)
ReplyDeleteThanks in advance, Rob. :)
ReplyDeleteHope so. I've locked myself into a buy and hold strategy Lol.
ReplyDeleteI was trading the 50% retrace of the impulsive dollar wave. The head and shoulders is a bonus if it works. :)
ReplyDeleteWhen we hit the bottom, and not before then.
ReplyDeletePL, $SPX just touched your "Trigger to rally high" from yesterday, I think.
ReplyDeletewould you look at vix. multi year low. if market closes over 1380, then1425 is in the cards. riding it up
ReplyDeleteWell BOJ has two options right. They can either default/restructure, which would completely wipe out their pensions - so not gonna happen. Or since they're in the unique situation where nearly all Japanese government bonds are domestically owned, they can print and buy those bonds to support their bond market. All while expanding debt-to-GDP ever more egregiously than their current 200% rate, BUT continuing the ponzi for as long as possible...Neither ends well, and no one wants to be the bearer of bad news...
ReplyDeleteYou mean the 2/29 impulse, 3/8 retrace?
ReplyDeleteGood morning PL,
ReplyDeletehere is SPX showing a completed 5 wave structure which I don't think is the last word since the overnight market pegged a new high.
It looks like we are due a biggish 'C' wave down then up to the last 5th with the previous A- B being 1 - 2.
What say you?
kind regards,
pop and drop day?
ReplyDeleteOh OK, you did say in one of your charts that without a solid retrace, you have less confidence in the bullish trade trigger.
ReplyDeleteLowest since June '07. Crazy.
ReplyDeleteSo have I with a small amount...painful isn't it. It'll pay off. I was thinking of starting a VIX support hotline, 1-800-KILLNME.
ReplyDeleteDon't know whether to laugh or cry. I'll do both. OK, dialing 1-800....
ReplyDeleteThere is no one left in Japan to purchase any more domestic debt. They have bankrupted the pension funds and have nowhere else to turn. Overseas will be the only market and this will cause interest rates to rise. The US will also have to start thinking of starting QE3 soon because there are very few buying US treasuries. Bernanke is as bad or worse than John Law ever thought of being.
ReplyDeleteJoe
We are experiencing a higher than normal call volume today, please try again later....
ReplyDeleteLooks a lot like the green count shown above. :)
ReplyDeletehttp://3.bp.blogspot.com/-7waJWhWZqUc/T187q_M__VI/AAAAAAAABeI/nETVLK69M_8/s1600/swag.png
Oh OK, you were probably doing the 50% retrace thing shown on the 5th chart of the day.
ReplyDeleteNo, the one shown in the article above. Although I was trading the 50% retrace in the Euro, technically. Bugs me that I didn't hold my E7 long from yesterday morning, would have made double the money and nailed it each way. But I dumped the long early.
ReplyDeleteI would say a bounce to 1.32 anytime soon is highly unlikely, unless the decline today is a b-wave, which I doubt. But that's what stops are for. ;)
ReplyDeleteI just bought some TVIX here. If VIX breaks 14, I'll dump it.
ReplyDeleteAll my posts back on last thread.
ReplyDeleteI was wondering if you went out for Chinese. This is about the longest an article has ever been up without a katzo post, so I went looking for ya. :D
ReplyDeleteyeah, its tough to hold these shorts right now, but I'm playing for that move. Any level you think knocks that count out?
ReplyDeleteEuro looks like it's doing a 4th wave here, so should still make new lows for the move. I'm so far in the money on this trade, I'm just letting it ride with a reasonably wide stop for the time being.
ReplyDelete"The US will also have to start thinking of starting QE3 soon because there are very few buying US treasuries."
ReplyDeleteActually there was an article in BB yesterday that said : "U.S. banks bought more government and related debt in the first two months of 2012 than they did in all of last year"
http://www.bloomberg.com/news/2012-03-12/banks-buying-treasuries-at-seven-times-2011-pace-as-deposits-beat-lending.html
Yeah, but you don't want to hear it. An expanded flat B wave shouldn't be longer than 138.2% of A... so 1393ish.
ReplyDeleteBe careful w/ shorts here.
Short 1 ES at 74.75, Stop at 76.25
ReplyDeleteyikes...yeah, I'm close to bailing. thanks.
ReplyDeleteAlso took a small position in SDS calls at 16 for $0.10 IF (big IF) SPX drops to 1340 range by Friday, these should be worth around $0.70
ReplyDeleteI could be completely wrong here (as I am 50%+ of the time). Not trading advice, trade safe.
no cross (yet) of 20/50 MA on 15 ES so trade was not confirmed, stopped out break even.
ReplyDeleteDD, what periods are you using for the MACD? If you don't want to disclose, that's fine too. : ) Just wanted to ask. Thanks.
ReplyDeleteIt will pay off in April, not till then. A little birdie told me.
ReplyDeleteNew print high. PL, I know you are (rightfully so) warning to play the bull trigger safely. With the new print high, is 1400 a high probability?
ReplyDeleteshort 75.5
ReplyDeleteDow flying but Russell lagging. Got in and out 3 times early and holding a short here. using your 1376ish as stops. good luck.
ReplyDeleteyup, that is the level.
ReplyDeleteCackling thru the tears...
ReplyDeleteshort esm at 75.5
ReplyDeleteI'm using 8 minutes bars for Super8. I've actually posted the "secret" behind Super8 last week, on Thursday I think. So it's there for the motivated. :-) What Super8 is is this: It measures ES (smart money) against 8 stocks that represent entrenched money, money that is super committed by not dumb investors but actually, very smart investors. The entrenched basket of stocks will not fluctuate on short time frame, but the traders who have look-ahead information will move ES on short time frame. Problem is, there is only a very small number of those ES traders, so picking up their signal is hard. However, by calculating the ES/the-8 ratio, then the MACD, which is what Super8 is, one can detect the very smart short-term money moves, which is ahead of the general moves.
ReplyDeleteThe trade trigger elected at 1374. As long as the SPX maintains closes above that level, the 1408 target is active. Would I say it's "high probability"? I have no clue what's high probability right now. ;)
ReplyDeleteRally time zone is now over. Retrace starting now. 11:30
ReplyDeleteOk, thanks. I will track down your Thursday post. Much appreciated.
ReplyDeleteBut don't expect too much retrace. Super8 is still bullish. ;-)
ReplyDeleteWhat is Super8?
ReplyDeleteStopped out of ES short at 76.25
ReplyDeleteHi PL,
ReplyDeleteI wonder why you count the wave from Oct 3rd low to Oct 27th high as wave a, and then Oct27th to Thanksgiving low as wave b, and from then to now as wave c instead of wave 1, wave 2, wave 3?
As a newbie in EW, I kind of see the entire rally from Oct low until now as a 5-wave move, and we're still only in wave 3, with 4 and 5 yet to come. As I apply the fibs to this, I have the top for this rally as 1450 (small top), or 1525 (medium top), and 1620 (large top)! I haven't calculated the extra-large top yet! LOL!
I'm pretty sure I got something wrong somewhere, so appreciate your explanations. Thanks.
In one hour (12:15) FOMC will affect mrkt action, it will get really whippy.
ReplyDeleteI thought it was 2:15 PM.
ReplyDeleteDid 1377 chnge your thoughts?
ReplyDeleteThat's what I thought, DD.
ReplyDeleteI have a whole new respect for liquidity. Are we looking at Nikkei circa 1989? All the rules seem to be out the window. It cannot go on forever especially considering the amount of global debt. Unsustainable.
ReplyDeleteCovered Euro shorts at 1.3105. Showing more strength than expected.
ReplyDelete2:15PM EST
ReplyDeleteShort 1 ES at 77.75, Stop at 79.25
ReplyDeletenice trade pretz! you snipe the hell out of these markets. you let it all come to you..
ReplyDeleteFor you, I will reveal my secret :-) ....... Super8 was constructed based on this list published by Mark Hulbert - http://www.marketwatch.com/story/the-best-are-bullish-the-worst-are-not-2012-03-01- which presented eight stocks that have committed money, lots of it.
ReplyDeleteTo recap the design of Super8: It measures ES (smart money) against 8 stocks that represent entrenched money, money that is super committed by, not dumb investors, but actually, very smart investors. The entrenched basket of stocks will not fluctuate on short time frame, but the traders who have look-ahead information will move ES on short time frame. The problem is, there is only a very small number of those ES traders, so detecting them is hard. However, by calculating the ES/the-8 ratio, then the MACD, one can detect the very smart short-term money moves, which is ahead of the general moves.
Now, the formula. Take the 8 minute MACD of the following and use the macd/signal line cross as the trigger. The formula works drop-in in eSignal. I used the March 1st closing prices as the normalizing denominators for the eight stocks.
( ('ES M2') / 1371) / ( ( (ABT / 57.32) + (AAPL / 544.47) + (CVX / 109.76) + (JNJ / 64.83) + (PEP / 62.55) + (VZ / 38.43) + (DIS / 42.39) + (WMT / 58.32) ) / 8)
Yes, you are right DD, 1:15 CST, 2:15 EST.
ReplyDeletehis proprietary indicator....hard to believe it though if you don't know what it is right?
ReplyDeleteAhhh the koolaid was fresh today..... Update. Closed AMZN call trade for small loss on decline into market strength. Closed OEX call for gain. OEX Put remains in play. Closed NFLX calls for gains at 109. Closed TLT puts for gain. Reversed that position and am long TLT 115 calls for long bond auction today and tomorrow. See ya tonight.
ReplyDeleteout 76.75
ReplyDeletety :)
ReplyDeleteOut of TF shorts. Unexplicable 2.5 point drop while SP fell .5 points. Strange but will take.
ReplyDeleteIt goes back to the bigger picture counts and the wave structure of each leg of the rally. Without getting into it too deeply, the overlap of the 2011 decline with the 2010 highs takes certain options off the table -- for example, this can't be a 5th wave. The structure of the October rally also counts best as a 3-wave move, which makes it a-b-c. It *could* be counted as a 5, which means it could be a -- but it's a weird-looking 5. Anyway, the first a-b-c leads to the second for a double zigzg -- the w-x-y count means two 3-wave moves, hence a-b-c.
ReplyDeleteGood trade. Are TF points worth $50 (same as ES)?
ReplyDeleteNo $100. I like because more active then ES
ReplyDeleteStop moved down to 78.5
ReplyDeleteAnother AAPL analyst raised the target price - to 699. Sounds like one of those Walmart specials.
ReplyDeleteGinormous out-of-the-money call is rushing into AAPL. Be careful shorting it. It can be quite dangerous to your financial health. :)
ReplyDeleteDoes anyone go long? lol
ReplyDeletePL, is there any book that you'd recommend regarding forex trading and the main factors affecting currency movements?
ReplyDeleteIn currency trading, what is the price increment size and the profit/loss per increment?
Thanks in advance.
I went long AUD several times in the past week. But I'm short from 1.08 so, just holding now for the selloff. The correlation between SPX and AUD has been off for 3 days now, which is rather odd since they usually move pip for tick.
ReplyDeletelong tvix yesterday at 14.03
ReplyDeleteYou can find most of that type of info here:
ReplyDeletehttp://www.cmegroup.com/trading/fx/g10/e-mini-euro-fx_contract_specifications.html
As far as the *how* to trade it, I trade it on technicals, just like anything else.
when pressing up against my 1376 ES tgt, it is a bit higher at 77, allowable, and EW5s and dojis all over the place no thanks I will pass. Could still go higher, then I get stopped out.
ReplyDeletelmao! You know what I meant!
ReplyDeletesoon...the bull aversion therapy costs are pricey. :o
ReplyDeleteThank you.
ReplyDeletelol
ReplyDeleteThnak you for the reply PL, much appreciated.
ReplyDeleteThis across the board rally is a bit strong for a 'b' wave isn't it?
Although I just noticed you reckon it could go a ways further before it need turn, so ..watch and wait.
Could be a nice entry for a short soon maybe.
I wasn't addressing you specifically, I just see "short" "short" "short" all the time across the board.
ReplyDeleteAnd I don't necessarily mean this exact second either -- I mean more in general. Earlier tonight would have been good, for example -- I dumped my ES longs to focus on my E7 trade, but still snagged a few points with them. Should have bought them back on the retest -- but I can't do everything at once and getting the update out took that half of my focus.
Anyway, I just think in general, there's money to be made on rallies too. And unless this is the b-wave of an expanded flat, the 1400's are just around the corner...
Right about the time you flip, near 1450 prolly, you realize what will happen... lol
ReplyDeletebtw, if this IS the b-wave of an expanded flat, I would expect it to end *very* soon. If it goes much higher, fuggedaboutit.
ReplyDeleteI went long from about 1343 to 1365ish. Depending on the next retrace I will go long and stick it out a bit longer. Just a little nervous about getting caught in the last rally before the powers that be pull the plug.
ReplyDeleteLong cash for the moment till this thing gives me a better looking entry point! Sold an IWM long Friday, and trying to figure out which comes first... 1400 $SPX or 1300 $SPX.... long cash till my head clears!
ReplyDeletedo you have a ceiling in mind that excludes the b-wave?
ReplyDeleteExpecting Bernanke to light a fire under the DX, which should halt and reverse everything else...
ReplyDeleteI went long yesterday evening on TF, got a good 4 points with 2 contracts each. Of course, this was only paper trading so phantom profits. I'm still only trading in the cash market in real life. I was within $0.50 of going long on TNA yesterday afternoon but didn't pull the trigger. After seeing the huge run-up in the futures and the comment about not being so confident of the bullish trade trigger with the shallow retrace, I cancelled the order. Cash is a position too! The sucky thing about trading in the cash market is lately all of the action has been happenin in the Fut's so by the time the market opens, most of the upside has already occurred.
ReplyDeleteSome day I'll pull the trigger on Futures trading: but then I have to figure out how to live on no sleep like katzo and PL! :-)
hey PL, en route to ATL airport I just read your post and seeing the markets blast up, so much for the bearish few (and the wave iv retrace we discussed over the weekend... lmfao....). I went long yesterday, taking profits after I land or tomorrow; not trusting this (or the entire buyer-less run up so far) as VIX is now totally outside its BB and below the trend line you mentioned. On the other hand, (my) rule of thumb is when 80s break, the 20s are the next target (e.g. 1380 --> 1420), but that's just a rule of thumb....
ReplyDeleteOh yeah....I know the answer to that question...I'm an f'n hardhead...I WILL actually obey the blue target boxes though...I promise. You're little blue boxes are the shiznit. But I'm still holding onto my UVXY...cuz that is gonna kick some arse in awhile.
ReplyDeleteDX = dollar index?
ReplyDeleteYes, depending on how the statement is framed around no QE3, that should light a fire under the dollar index and halt commodities/ES in their tracks.
ReplyDeleteJust trying to get everyone to look at the other side a bit. I'd hate to see this thing go to 1440 next with most of the board shorting the whole way up.
ReplyDeleteI realize, katzo, that you trade extremely short time frames and are nimble enough to get in and out w/ a profit even trading counter-trend, but a fair number of readers aren't that nimble. :)
Also, I should add, I'm not suggesting everyone go long here and now. In fact, I'm leaning toward the short side, but I'm sitting on my hands for the moment, outside of my spec TVIX purchase. Might short Euro again in a bit -- but if the dollar rallies, I can be certain Euro will decline. I can't be completely certain SPX will, such as the other day when everything was up.
ReplyDeleteAnyway, it was just a rhetorical question. :)
good question none the less (man I love this inflight online shit!) it's amazing if you think about it: sitting 37,000 ft high in the air flying towards ATL and surfing the web. not bad!
ReplyDeleteThanks for the explanations. Glad to hear that...It would be scary to look at it as a 5-wave!
ReplyDeleteStopped out of ES short at 78.5...
ReplyDeleteEven if you only trade pre-market and RTH, I think it is definitely worth going with futures. Small moves can pay off in futures where the spread and commissions would eat all profit in the cash market.
ReplyDeleteThere's a trendline on RUT that is defined by May and July 2011 highs. At this point in time, the trendline is in the low 830s which is also the lower target of Wave V on the RUT that I posted last Friday. I wonder if that might be a good low-risk entry to short?
ReplyDeletePL, I just checked your charts AND read your post ;-) Seems like 1b of your last chart is hit and given VIX is now totally outside it's lower BBs, while SPX, COMP, NDX are currently above their upper BBs (20, 2) we may hit the green wave IV because
ReplyDeleteif they close inside the BBs today, then that often indicates a sell off; e.g. SPX is now at 1383.94, upper BB is at 1382.97, so only a few points will do the trick.... Bernanke holds the cards at 2:15pm ET...
Yep, this market is all about The Ben Bernank.
ReplyDeleteThose are the types of entries I look for, then try to narrow the structure down as the time frame gets closer.
ReplyDeleteMARKETS
ReplyDeletehttp://traderjoed.blogspot.com/
MARKETS
ReplyDeletehttp://traderjoed.blogspot.com/
MARKETS
ReplyDeletehttp://traderjoed.blogspot.com/
Felt moved to post something ; )
ReplyDeletehttp://www.youtube.com/watch?v=kn481KcjvMo
Dollar has now retraced 62% of last night's move. Needs to hold here.
ReplyDeletePL, I'm looking at the second chart (SPX) from today's article, and am wondering if the presence of the $&P up at 1384 constitutes the end of wave (v). That would be "more from a fifth wave", yes?
ReplyDeleteNew to the blog in the last week or so and been following PL for about a month. Very Insightful daily posts by PL and resulting commentary by the group. I have done some reading on EW, but am certainly a newbie. I put a small short position on late Friday anticipating to catch a sell the news on employment/Greece/CDS's (Apr 1350 Puts). Per earlier postings my stop was 1378 on the SPX. I closed that out this morning for a loss, a little larger than I expected with volatility collapsing. I decided to go long with Apr 1410 SPX Calls. Will exit on the downside if it sells off to 1365. Per PL's bullish trade trigger, I thought a break above 1378 (combined with the CNBC hype of god retail sales would encourage the bulls and cause some short covering). I realize Im asking to get whipsawed, but have made back 1/2 my loss on the SPX puts I sold earlier today.
ReplyDeletePotential head and shoulders on the dollar...
ReplyDeleteweird for the market to tick up like this during lunchtime. Starting to believe in brianhut's pre-fed pump and dump. i guess we'll see soon enough.
ReplyDeleteNot enough more. "More from a fifth wave" meant 1400's. :)
ReplyDeleteNot that you'd rely on them exclusively, but GS has had their RUT target set at 830 for several months. Only they wear suits and shiny shoes.
ReplyDeleteHi, welcome to the blog. :)
ReplyDeleteTVIX is currently trading at a 25% premium. You might do better with UVXY. Last week when UVXY jumped 15% TVIX only went up 4%. As soon as people tried to take profit the premium collapsed from 17% to 7%.
ReplyDeleteIn my practice account I have a small position long UVXY and short TVIX. Does anyone know if TVIX shares are hard to borrow?
Thanks.
ReplyDeletenot good
ReplyDeleteFrom the looks of Super8, plus the fact that oscillators higher than 10 minutes are topped anyway, I would short just ahead of FOMC at 2:15. Flux is also in confluence for a 15 minute trade at that point.
ReplyDeleteAlso, a wave 5 has apparently just completed on the 10, 15, 30, and 60 minute charts (in eSignal auto EWave).
ReplyDeletequite a reversal in VIX from under 4 to almost 16. Now it is back inside the BB bands. let's see how it closes...
ReplyDeleteThanks for sharing your secret weapon. I think your super 8 might be telling some story.
ReplyDeleteThe conclave at the Fed arrived at a conclusion on that Shakespearean question that the market is hanging its every breathe on: "To QE3 or not to QE3?"
ReplyDeleteIn a few short minutes, the market will render its verdict on the gentlemen's judgement. :)
You're welcome. It looks like the things are beginning to head the indicated way. 2:16 PM.
ReplyDeleteGLD promptly tanked on the gentlemen's incredulous puzzlement - "Inflation? What inflation?" :)
ReplyDeletedoji engulfing on the 15, inverted hammer on the 30
ReplyDeleteThe Bernank doesn't fill up the tank. That stuff is on the taxpayer's bill, not his.
ReplyDeleteLooks like the inmates are going wild in the RUThouse
ReplyDeleteTY. Engulfing on the 30 also.
ReplyDeleteyes
ReplyDeletebreakin
ReplyDeleteMore likely on GS's bill...no...you're correct...on the taxpayer's bill.
ReplyDeleteFlux suggests that if ES doesn't drop prior to EOD, it will immediately after.
ReplyDeleteneat...
ReplyDeleteGold continuing to hammer at that $1680 resitance time and time - would be a huge break if done midday.
ReplyDeleteWe are just 2 minutes into an 8 minute bar, but Super8 has turned suddenly bullish.
ReplyDeletefinally figured out what that was, up 80 means up 120, then down to 70 to 90, then to 140 DJIA
ReplyDeleteJPM received a clean bill of health for the stress test. They announced share buyback and increasing dividends. Taxpayers backstopped their failures. The windfall, belongs to the shareholders. Very American. :)
ReplyDeleteIf all banks came out of the stress test alive and clean, watch out. Financials will lead the next leg of the rally.
So now we know that the Fed does not leak anything out.
ReplyDeleteIsn't that great? Stress tests are due after Thursday's close... but it was extremely convenient for JPM to announce its results today, plus a dividend increase and share buyback. Wow. There is no manipulation here whatsoever. ; )
ReplyDeleteThe magician's misdirection takes place in the minds of the audience :-)
ReplyDeleteGOLD SNAPS! Decoupling?
ReplyDeleteBy the way... now we now why VIX collapsed yesterday.
ReplyDeleteThe party is about to end, very soon. Blow off top. IMHO
ReplyDeleteVIX now up
ReplyDeleteC notified floor traders to prepare for a very important announcement - either today or tomorrow. :)
ReplyDeleteI think JPM is the bait to keep the market hooked until Thursday's close (at least). Then Friday is iPad day. So I think this blow off top MAY go on for a bit more (per PL's targets).
ReplyDeleteWhat you said.
ReplyDeleteApparently the economy is doing fine. Intervention is no longer needed.
ReplyDeleteNot anymore
ReplyDeleteI am thinkiong this week not today. Suck in the last of the money
ReplyDeleteDipped my toe in for a small short
ReplyDeleteThen the banks can give out free money...you know...to say "thank you taxpayer".
ReplyDeleteSo I guess the way it works is: The guy who knows ahead of time buys at-the-money calls and sells out-of-the-money calls (at higher strike) - That would be the Bull Call strategy. The selling pressure from selling the out-of-the-money calls is what drives down VIX.
ReplyDeleteSee my post. Was low yesterday for a reason.
ReplyDeleteThey are getting free money from the FED at 0% and buy US Treasuries for 2%, pocketing the difference. There is no need to give out free money. As to "thank you taxpayer", it is not very capitalistic. GS's chairman said it best, "It's our God given right to make money." :)
ReplyDeleteKatz, hit yuor 220 then pulled back. nice call.
ReplyDeleteAnd just look at the action today. Up, up and away...
ReplyDeleteshould have said "the Bull Call Spread strategy"
ReplyDeleteKatz that 220 rule is some cool shit!
ReplyDeleteindeed. to borrow from greenspan, it is quite the conundrum how one could advance the idea we are now in a virtuous, self sustaining economic cycle while at the same time arguing for emergency policy action like continued zirp and unbridled qe.
ReplyDeletethen again, it was just a few months ago that bernank and bunch were warning of massive downside risk.. like many a central planner before them they obviously have no clue what is actually going on.
Friends of Ben and O
ReplyDeleteBut certain parties went and profited privately. Not the same as leak, I guess.
ReplyDeleteEverything that is not nailed down is up. Incredible. :)
ReplyDeleteI think Paul McCartney said/sang it best in the song...."maybe I'm amazed"
ReplyDeleteBaby I'm a man and baby I'm a lonley man
who's in the middle of something
that he really doesn't understand
No... The individuals who know ahead of time hand misleading information to the press, they buy the market, sell puts, buy calls, sell the VIX, ramp futures overnight, let out the news that they already knew the next day, and take their money laughing all the way to the bank.
ReplyDeleteOh wait... almost forgot... they are already at the bank!!! It's the FED at work.
When I was young there was a saying "what goes up must come down", or was I dreaming.
ReplyDeleteLooks like I picked a bad day to stop sniffing glue!
ReplyDeleteYet, we have the best form of government. What corruption?
ReplyDeleteThis market is unbelievable!!! It's been going up on everything, anything. We may see 1450 by end of week...
ReplyDeleteThe only thing that can probably bring it down now is a worsen conflict between Israel/US and Iran! I hope there won't be any war, but it feels like somebody is trying to cash in before something bad happens!!!
O's ratings dropped dramatically in past week so the full press has started. Buy the vote any way possible.
ReplyDeleteA1, They may indeed do all those things you listed (especially the misleading part), but I was trying to theorize why VIX dropped hard on a flat day yesterday. If there was substantial execution of the Bull Call Strategy everywhere, but especially in the financials, that would drive down out-of-the-money premium, which is exactly what the VIX measures.
ReplyDelete(Bull Call Spread) http://www.888options.com/strategy/bull_call_spread.jsp
(VIX - emphasis on out-of-the-money prices) http://en.wikipedia.org/wiki/VIX#Specifications
I guess nowadays, it's "what goes down must come up."
ReplyDeleteNot before you go broke...
ReplyDeleteIn the markets, "what goes up must come down" doesn't work very well. Especially when it is being orchestrated upwards by the FED.
Definitely! with respect to TVIX ;-)
ReplyDeletemust stay up
ReplyDeletecapitalism....lol....gimme some of that ol' time capitalism.
ReplyDeleteThe Fed *is* a bank. And we thought it was the government LoL.
ReplyDeleteToday's equity action is not supported by FX AT ALL. Just look at AUD/USD which normally correlates well with spx barely moved ever so lightly only with this blast off. It is lower than when spx was at 1380. Look at GOLD, hammered to the tune of $40. Today is wild day for VIX. Certainly feels like a blow off top, but what do I know??? This thing might just be like the energizer bunny that keeps going and going...
ReplyDeleteI believe taking too much Viagara can give one high blood pressure.
ReplyDeleteYa gotta keep those 401(k)s pumped for the AARP vote (which I'm not too far away from).
ReplyDeleteDid you hear the discussion of requiring retirement plans to be invested in Govt bills/bonds?
ReplyDeleteSaw that yesterday, I think on Fox or CNBC. Noone will have retirement in a few years if it passes.