29 October 2009

29 OCT 2009, Thursday


  1. Well, there's a bounce talked of yesterday...let's see what else they've got to the upside.
  2. SH bought at 54.8 (stop @ 53.7), last close 55.6.
  3. Recaptured the trendline and the 50 day moving average. Will have to see what they've got in store. 

28 October 2009

28 OCT 2009, Wednesday






  1. Nice!  SP500 breaking down some more which is good for the SH position (inverse SP).  It has pierced the yellow uptrend line since March 2009 and has also closed below its 50 day moving average...showing some weakness.
  2. SH was bought at 54.8 (stop at 53.7), current close is 56.7.
  3. The only fly in the ointment is that in doing so it has registered some pretty good short term oversold conditions in a few indicators in the process so one should be prepared for some bounce coming in a day or two.
  4. NOTE:  New SP500 highs still can't be ruled out. So caution is still warranted in my opinion.
  5. What I'd like to see is a move down into the 1030's then a rally into the 1060's followed by a rollover back down to break the 1030's lows (if that's where it happens).  All conjecture...but that would set up a nice lower high swing to then break into lower swing lows which is the definition of a down trend.
  6. Supporting the downside is sentiment.  Below, the investment newsletter writers have a very low number of bears which is conducive to more down in the perverse world of market psychology.  Retail investors are more bullish then they've been in awhile too.

27 October 2009

27 OCT 2009, Tuesday

  1. A slight up day on SH...Down day on SP500.  Short term do we get a small retrace?  We'll see.

26 OCT 2009, Monday




  1. The last few days have been a roller coaster up, down, up, down...will the bear ever catch his prey...or will these silly games continue?
  2. Wow! A little follow through to the downside today.  Hey...I'll take what I can get to the short side.
  3. The SH buy at 54.8 (stop at 53.7) is back in the black with a close today of 55.5.  This has got to prove itself or it will "be fired" by the stop.
  4. So far all we've done in the SP500 is break down from a very short term sideways area which could possibly turn into just another retracement like we've seen the past few months.  But it was very extended so it was worth a shot to find out.
  5. Intermediate term the market is still up until the SP500 gets some giddyap to the downside and breaks the yellow uptrend line from the March bottom to now and then some swing lows.

     

22 October 2009

22 OCT 2009, Thursday


  1. So, yesterday the bears had their way in a good sized late day sell-off.  But today, this kitty comes along and scared Da Bear...and there was a good sized late day rally that recaptured most of yesterday's sell-off.
  2. Chopping up and down at a high level similar to the other tops on the daily chart over the past few months....multi-day flat with little ups and downs.  Tops are hard because they take time...is this a short term top or do we punch higher towards the SP500 1108-1120 area first?  Tough to say...really noone knows.  Certainly is frustrating.  The bulls have been conditioned over the past half year to buy any and all dips...at some point that will fail.  When remains the unanswered question.
  3. The hypothetical SH position was stopped in on a buy yesterday at 54.8 and at today's close is underwater at 54.2, stop at 53.7.  Wouldn't be surprised to see a stopout...but it's a hypothetical so let's let the stop do what it is there for, if necessary.
  4. When will Da Bears grow a pair like this little guy?

21 OCT 2009, Wednesday


















  1. Just gotta love Goldman Sucks.  Now I'm not too down on them selectively...it's just that they are the poster child of "Da Boyz".  Anyway...moving on...
  2. Was that it?  Was that the top...with a shooting star candle?  Wish I knew with 100% certainty...would really make this easier.  But, alas, the past is ours to remember and learn from, the present is ours to live and enjoy, while the future is the story yet to unfold before us with all its potential twists and turns.
  3. Hmmm...interesting day.  Got my "one more jab to the upside" talked of yesterday...Bolted to the upside in the early morning and then chopped around at high levels for 4 hours and in the final hour a ton of selling hit out of the blue bringing it to a negative close.  Interesting.  It even appears that an SH buy was taken at the levels mentioned yesterday which kind of surprised me based upon the day's early strength.  OK...so we'll see how that hypothetical position plays out....consider the stop...or better still, what's your plan?
  4. Sentiment of newsletter writers and retail is net bullish...which is not necessarily a good thing.  Another brick falling into place?  We'll have to see how it plays out.  Would be great to see retail get really stomping and snorting bullish...for short sales that is but maybe they got burned too bad the past 2 years and this is as good as it gets. 
  5. But, overall, price action is the thing to watch most importantly.  Bar by bar analysis on the daily shows that we've broken below the most recent pivot.  Can it hold and follow through to the downside?  It's a start. 


20 October 2009

20 OCT 2009, Tuesday


  1. Personally, I'd like to see one more jab to the upside in the SP500...or downside in the SH...but we're in a price zone of interest for a "potential turn".  In additon... 
  2. One thing that was of interest today is that even after Apple reported blow-out earnings to the upside, it still closed down from where it opened...admittedly, after a huge gap to the upside...and after an overall monster rally from March 2009...to hit highs smacking into the 2007 highs (but not surpassing)...and then petered out.
  3. Another item of interest, is that despite the major indexes continuing to plow forward the number of advancing stocks is beginning to shrink compared to the number of decliners...which is not a good sign for continued health of the indexes overall.  But it can still go up.  There are no gaurantees.
  4. Buy SH 54.8 with stop at 53.7?  Your call. 

18 October 2009

17 OCT 2009, Saturday



  1. Just some perspective...weekends are for stepping back a bit and trying to see the "big picture" which means weekly & monthly charts.
  2. The move down from the October 2007 top to the March 2009 bottom was -58%.  To all those that said that the percentage move was huge, incredible, monstrous and unbelievable...if 58% in 17 months was too big...
  3. What does that make the current +64% move, in 8 months, from the bottom to the current high?
  4. Alright...always looking for alternatives soooo...I took a look back into the "Swinging '70's"...WooHoo!!!  Below is the monthly SP500 chart of what occurred back then and it's annotated so you ought to be able to figure it out.  Sideways slog or quick turn coming?  Dunno...just going to have to take my chances while being aware of the possibilities.
  5. Short term still up...need to see lower lows and lower highs to first show some sideways before you can even think of down.

 

16 October 2009

16 OCT 2009, Friday




  1. All pay homage to mighty Goldman Sachs...one of "Da Boyz".
  2. Now remember...they are a bank meaning they are taxpayer backed by FDIC (not to mention the TARP) and, oh yeah, they have connections in high places (ie, Treasury & Federal Reserve) who have stuffed money into them along the past two years.  Now, banks aren't supposed to be taking big risks but these guys do since they are confident that they have you as their backstop if it goes bad for them...and the proof is below in the breakdown of their recent revenue results.  Check out where they are making all their $$$ in the chart below.
  3. But, before you do...Remember, post 1929 Crash, the Glass Steagle Act was passed and prohibited banks from trading on behalf of themselves specifically because that practice led to "banks gone wild" and eventually to "banks gone bye-bye".  That law was repealed during the Clinton Administration and "Easy Al" Greenspan's tenure as the Federal Reserve Chairman.  And now we have the same setup with Bernanke holding rates even lower than Greenspan did for a long time and the banks are using leverage to the gills for trading.
  4. We haven't learned anything during our recent "crisis".  It just demonstrates how capitalism is being abused....whatever they make they keep and whatever they lose...well, you keep!  Pretty neat huh?
  5. What absolute bullshirt!  Once again, this shows how we've just lived through the biggest scam in history.  Bernie Maddoff?  He's a piker!  Goldman says, "Go big or stay at home."

15 October 2009

15 OCT 2009, Thursday


  1. New highs...going up...overbought gets more overbought. Not much has changed...yet.  Interesting was that the market didn't forge ahead smartly today on Goldman's blowout earnings numbers. Then again, after being up so many days in a row, it was an accomplishment to still close up on the day. 
  2. We continue to struggle with a price gap area (SP500 1082-1108) from October 2008 and then we have the 50% retrace level at 1120.  Possible that the gap finally stops this upmove just short of that 1120 level that many are looking at? 
  3. This is that area first indicated in this chart here from 24 SEP.  You can check the current daily charts in the side bar and see how close we are now.  Basically we are less than 2.5% from that area which has multiple long term trendlines and a Fibonacci 50% retracement.  In other words, I'm entering a zone in which to be alert.

14 October 2009

14 OCT 2009, Wenesday




















  1. Well...whaddyano...Da Boyz did it!  Amazing what the start of earnings season can do with Intel last night, JP Morgan this morning, Goldman Sucks, Citibank, Google and IBM tomorrow...can lead to emotional swings which may pump this higher into overhead resistance? 
  2. SP500 gaps up and closes at 1092.  Effectively, we've entered into a potentially interesting area...now to see if there is any reversal.  My guess is not until next week since Friday is Option Expiration day and Da Boyz may want to cash in their options at higher prices.
  3. New highs...going up...overbought gets more overbought.  Not much has changed...yet.  May or may not add more later. 

13 October 2009

12 OCT 2009, Monday


  1. Above is a chart of the 1970's Bull and Bear moves.  I'm just putting this up to remind myself of the environment I think I'm in .... big ups with big downs for a net "nowhere".
  2. Saw this today and it seemed wise to me...."How Do You Sell the Tops?"  According to Raymond James Strategist Jeff Saut, who channels Ed Genstein, you don’t:

    “The absolute price of a stock is unimportant. It is the direction of price movement which counts.”

    “During major sustained advances in stock prices, which usually occupy from five to seven years of each decade, the investor can complacently hold a list of stocks which are currently unpredictable. He doesn’t worry about the top because he knows he is never going to sell at the top. He knows that the chances are overwhelming in favor of the assumption that he will get far better prices by waiting until after the top is passed and a probable reversal in trend can be identified than he will ever get by attempting to anticipate the top, and get out on the nose.

    In my own experience the largest profits we have ever taken have come from stocks purchased while they were making a new high in a market which was also momentarily expecting the top. As I have already pointed out the absolute price of a stock is unimportant. It is the direction of the price movement that counts. It is always probable, but never certain, that the direction of the price movement will continue. Soon after it reverses is time enough to sell. You should sell when you wish you had sold sooner, never when you think the top has arrived. That way you will never get the very best price – by hindsight your individual transactions will never look daring. But some of your profits will be large; and your losses should be quite small. That is all that is necessary for a satisfactory, enriching investment performance.”


11 October 2009

10 OCT 2009, Saturday



  1. Uh huh...just keep right on telling yourself that.  That way at least someone will believe you.

09 October 2009

9 OCT 2009, Friday



  1. President Barack Obama has won the Nobel Peace Prize!??
  2. Hmmm...Prior US winners...President Carter, Vice President Gore and now President Obama.  Yup!  Seems to me that the Nobel Peace Prize has now officially been degraded to the point of complete worthlessness.  By the way, what exactly did Obama do less than 3 weeks into office that made him even eligible to be nominated for the award in February 2009?  "Nothing to see here folks...move along!"
  3. But that's not the wackiest headline for the day:  Saudis ask for aid if world cuts dependence on oil
    There are plenty of needy countries at the U.N. climate talks in Bangkok that make the case they need financial assistance to adapt to the impacts of global warming. Then there are the Saudis.  Saudi Arabia has led a quiet campaign during these and other negotiations — demanding behind closed doors that oil-producing nations get special financial assistance if a new climate pact calls for substantial reductions in the use of fossil fuels . . .  “We are among the economically vulnerable countries,” Al Sabban told The Associated Press on the sidelines of the talks ahead of negotiations in Copenhagen in December for a treaty to replace the Kyoto Protocol, which expires in 2012.”This is very serious for us,” he continued. “We are in the process of diversifying our economy but this will take a long time. We don’t have too many resources.”  Saudi Arabia, which sits atop the world’s largest proven oil reserves, is seeing economic growth slide because of fallout from the global meltdown, but experts still expect the country, flush with cash from oil’s earlier price spike last year, to be better able than other nations to cope with the current crisis.”
  4. Seriously — is someone pulling our legs?


05 October 2009

5 OCT 2009, Monday



  1. Happy Birthday to TARP, Happy Birthday to TARP...one year old today.
  2. CNN/Money has a pair of nice graphics dissecting how taxpayer monies were spent, along with likely losses.
  3. Well...the SP500 has put in lower highs and lower lows on its 60 minute chart for the first time in awhile.  Next, it will be important to see how it fairs when the 60 minute chart takes its next swings upward.  Saw this and thought it a reasonable summary...waiting to see what's next.
  4. Janet Tavakoli: Risk of deflationary collapse greater now than in 2007.  Take a listen to the two 5 minute videos....downright cheery.
  5. And for even more cheer...the Congressional Budget Office (CBO) states that its fiscal disaster scenarios could cause severe economic declines for decades to come, including hyperinflation and destruction of retirement savings.
  6. They're just scenarios but forewarned is forearmed in my opinion.

03 October 2009

3 OCT 2009, Saturday


  1. Why do I get the willies when I hear stuff like this? ....
  2. Geithner Says Recovery Signs Are ‘Stronger’ Than Expected By Rebecca Christie. Oct 3 (Bloomberg) -- Treasury Secretary Timothy Geithner said signs of economic recovery are “stronger” and have appeared “sooner” than expected, while reiterating it’s not yet time to roll back stimulus programs. Financial conditions have improved “dramatically,” particularly in the U.S., where the housing market has stabilized, Geithner said in a statement issued in Istanbul today. Still, jobless rates are “unacceptably high” and the financial system remains damaged. As a result, it’s too soon for governments to withdraw stimulus, Geithner said.
  3. So, Tim, what is it? Strong and sooner than expected or still "damaged" and requires the "unlimited checkbook of the taxpayer"? Well? Which is it? How can you even include both statements together as they are in direct contradiction of one another.
  4. Why the willies? It reminds me of Irving Fisher...a famous economist in the early 1900's. The stock market crash of 1929 and the subsequent Great Depression cost Fisher much of his personal wealth and academic reputation. He famously predicted, a few days before the Stock Market Crash of 1929, "Stock prices have reached what looks like a permanently high plateau." Irving Fisher stated on October 21 that the market was "only shaking out of the lunatic fringe" and went on to explain why he felt the prices still had not caught up with their real value and should go much higher.
  5. Sounds slightly similar doesn't it?
  6. I intend to get paid by being nervous and reading between the lines of what the elites say and what reality says.

01 October 2009

1 OCT 2009, Thursday


  1. Investment newsletter writer sentiment above: green is the bulls, red is the bears and black is the SP100. According to the weekly data from Investors Intelligence, bullish sentiment among newsletter writers is toward its highest levels since January 2008. Meanwhile, bears are practically in complete hibernation. At a level of 24%, bearish sentiment is toward its lowest level since late 2007.
  2. Sentiment is not necessarily a timing tool because it can go to extremes and stay there for long periods. But it is useful to determine the risk environment.
  3. Retail Investor Bulls can be found here.
  4. Retail Investor Bears can be found here.
  5. Overall Retail Investor Sentiment can be found here.