Morning Call [8:35am ET] The correction has ended according to technical analyst Colin Twiggs. The DJIA at 10392 appears headed to 10750, the January high, he says. The important point he makes, though, is that “Long-term momentum is slowing and we are unlikely to see a repeat of the heady gains from 2009. Short- and medium-term trading systems are likely to out-perform long term traders for the foreseeable future — until the global financial system returns to a sound footing, with no artificial support from central banks. It may be some time before we witness another bull market."
source: Colin Twiggs incrediblecharts.com
As for today, I don’t see much going on in Europe other than traders are not too concerned about the Greek banks.
Have a great day.
CTA Trading Desk Post-Close Report
As volume continues to be nonexistent and upside momentum begins to wane at solidly defined levels of resistance, the odds favor a consolidation of recent gains. Turnover in the S&P futures ran less than -50% of normal, an astoundingly low percentage, as traders are distrustful that prices (S&P -0.12%) can keep chugging higher without a correction.
When a market (or a stock) has been going up for 9 or 10 days and volume vanishes and prices stall at a 618 retracement level, caution is warranted. Financials (XLF +1.24%) gapped higher on the opening, as JP Morgan Chase (JPM +2.05%) and Wells Fargo (WFC +2.34%) led the way upward, giving the market every reason to continue its recent ascent; the failure to pierce resistance, however, puts the Bulls on the defensive near-term.
Unless volume magically re-appears on the upside, it seems logical to expect S&P 1080-1085 will be retested on subsequent weakness. Alternatively, a move above 1115 on volume would give Bulls enough ammunition to attack the January high of 1150.
Let’s just sit back and let the market tell us which way it wants to go. When a trader can see both sides to any trade, his or her observation and instincts are usually spot on because they are objectively searching for clues to generate future trades.
No directional bias translates into clear vision.
Have a great evening.
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Comments
Cara 100 Update
PG - PT Raised from $74 to $77 @ Jefferies & Co. Buy
Out for now
Resistance levels were breached Friday and I got stopped out of all but one of my shorts. The other will like go down early today if pre-market is any indication of things to come.
Puzzling, isn't it, that no one is concerned about the pending disaster in Greece? I guess concerns will rise as March 16 draws closer, and then we'll get one of those sudden "unexpected" multi-hundred point drops in the market. And Greece will be cited as the reason.
And Matt Taibbi has another RS article up on the crimes of Wall Street.
Wall Street's Bailout Hustle
SLB
down 3.55, 10 day ATR is 2.05.
Dec 8 kangaroo tail reversal.
Buy limit 59.41. If not executed by 11 AM, I'll pull the order.
Roughly $1 risk vs March expiration of $65 or $5.5 upside.
Do your own homework.
Update: didn't hit my downside target by 11 am. Cancelled order.
Cara 100 Update
DELL - Standpoint Initiates Coverage with a Buy. PT = $18
PBR - Upgraded to Overweight @ HSBC
Risk analysis
Running $indu, $spx, and $compq (naz) against IEF to analyze market risk shows RSI 7 day 69, 69, and 71.
Market risk is increasing. % of stocks trading above 50 DMA is also quite high. Doesn't mean the markets can't go higher but it appears risk is up there as well. Clarification: Risk/reward isn't there on the long side IMO.
FD: long SPXU Friday's close.
Do your own homework.
Cara 100 Update (Final)
JCP - numbers boosted at Government Sachs. JCP 2010 and 2011 EPS estimates increased to $1.55 and $1.80, respectively, to reflect lower pension costs. Maintain Neutral rating and $28 target.
ORCL - target, estimates raised at BofA/Merrill. ORCL price target increased to $30 from $27.50 on potential synergies in revs, COGS and opex with Sun. Estimates raised through 2012. Reiterate Buy rating.
PBR - target, numbers cut at Government Sachs. PBR price target lowered to $57 from $60 as investors have begun to focus more intensely on the implications of the pending new pre-salt oil regulations. Estimates reduced through 2013. Maintain Buy rating.
LIZ
They have earnings after the close. The stock has been trading pretty strongly the past few days/weeks and they have a huge short interest. They are a turnaround story so earnings could provide a huge spark for the stock.
FD:
I bought some this morning at $6.57
another day another dollar...
ah yes, the familiar market action where gold jumps over night and falls into the open and onward, w/ the shares following in kind.
until gold can move above that tricky $1125 level on good volume and stay above there as opposed to a pop and fizzle, im not convinced. at all.
good luck, dont get fleeced.
Re: another day another dollar...
Yap, you are right about the weakness in gold and miners this AM.
However, SLV is acting bullish with nice higher lows pattern for several days now. I believe this is due to the suppressed SLV:GLD ratio.
The stories of students and their debt number
http://bit.ly/a4T2qS
Who is to blame? the parents for not teaching money mgmt? Banks for predatory lending? Govt for helping colleges raise tuition through easy credit to students? Prob all.
TRAK capitulation play
RSI 7 day below 10. Max pain for March is 20.
10 day ATR is .6
15 minute chart showing divergence, nothing on hourly chart.
Roughly 6:1 reward:risk.
Buy limit 14.16.
Do your own homework.
record FXE volume on Fri
It was the highest in way over a year. Most of that happened in a couple of hrs before the close. Not sure what it means. Short covering before weekend? Reversal coming??
AIG up 11% .....HA!
AIG hasn't paid back the US taxpayers one penny of the 120 billion dollars they received without even a vote by the US taxpayers saying YA or NA, under the threat that the sky was falling, and there isn't enough time to vote, let alone think what is being done to the future taxpayers or the US. One week later they take that free money and pay GS and JPM 100 cents on the dollar for bets they themselves made against home loans. There isn't one mention for AIG to pay back any money that they stole from the future taxpayers via Paulson, who ironically, wasn't even elected by the US citizens, but instead is placed into the highest federal position in the US by his buddies after the mysteriously sudden resignation by John Snow.
The US government is a scam, and the direct result is the Fed and the equity markets.
Get ready for an upgrade for AIG by GS and JPM.....their not that stupid are they? On a second thought, GS and JPM can just hand the dirty work off to Reuters like they have the last 30 years.
Will wait and see if SLB will make a 3 day
pattern on the low... seems that 59.80 range may hold.. can't rule out another 3% down on a down market stretch..
Someone forget to turn on the super computers?
is the market closed today?
XLF
When short XLF @ 14.60 with a first target of 13.96 gap. My stop is at 14.74. Reason for the play was two big volume down days and we are testing the gap between the two with 60% less volume and the people trapped here I think will be looking for an exit--I hope!
Excellent Gold/Silver Comments
This is a must read for any gold/silver investor. It is an interview of the co-founder of precious metals dealer Miles Franklin...
"Well, most people in the country, they still don't have a clue. We're so up to the moment with information, via the Internet, e-mail, BlackBerries, CNBC on every street corner—everywhere you turn, there's more information. Yet most people don't have a clue that gold has outperformed every major asset class for a decade straight. In 2002, gold was $250 an ounce, and silver was $4.25/oz. So you're looking at a gain somewhere in the neighborhood of 500 percent.
When you think about how rapidly information disseminates to the public, it's absolutely embarrassing that the financial advisers of the world—and the people who work so hard to obtain their money—don't realize that, indeed, this has been a bull market that has trumped all others for the past decade."
http://tinyurl.com/yfhuubd
CARA managed ETF's
I would also be interested in that for a percentage of my portfolio.
Re: Out for now
I also read the Rolling Stone article over the weekend. It amazes me that the folks in Washington say they want financial reform when they haven't figured out what Wall Street was/is doing. Talk about reloading, frontrunning, you name it.
Re: Excellent Gold/Silver Comments
Interesting that you mentioned this, as I was wandering about it lately. You would think after this performance, people would be piling on PM like crazy. I'm not seeing it. I use Rydex stats for my sentiment studies and PM is a small fraction of % of all holdings and on average fairly constant as far as the charts go (2002).
Looks like gold is not on a radar screen of an average investor and especially the financial "advisers". This sounds very bullish for PM.
I wish I could get a chart from 70s showing PM holding as a % of all assets.
Anyone?
The Euro, Geoge Soros, Reuters
Did Soros make this comment out of genuine concern, OR, was he trying to have an effect on the Euro/USD trade ?
"would leave the future of the euro currency in question, billionaire investor George Soros said."
Quoted out of Reuters, note the USD vs the Euro has had a nice little turnaround.
Or, why does this Toronto boy mistrust Soros ?
Re: The Euro, Geoge Soros, Reuters
"Did Soros make this comment out of genuine concern, OR, was he trying to have an effect on the Euro/USD trade ?"
For whatever reason he said it, it seems to makes sense to me. I would go one step further and say that I think the future of the EEU is in question.
Germany, with the strongest economy in Europe, is not likely to want to carry the PIIGS. If Germany bails out then they are toast as a union.
It looks like a mirror image of the US without the currency wild card.
Like the man said, "We live in interesting times."
Bill, based on Colin's sentiment's
and the chur that is ongoing,are you inclined to take new short term ( 3 wk ) positions this week ? If you buy ( bought ) today, how might you and your team scale into positions ( equity shares, not options ) ? Would it be something like 15% first purchase ( of total projected allocation ) ? That's pretty much the frame I am using last week and today, dependent, of course, on the flow..
Re: The Euro, Geoge Soros, Reuters
Soros said that gold was definitely in a bubble, when his portfolio became public he had added to his gold position.
Anyone home?
Bulls? Bears? Pro traders? anyone?
Re: The Euro, Geoge Soros, Reuters
I could be wrong, if I am please correct me, but I would not write if I believed so.
Soros said that gold is the "ultimate bubble" which could be interpretted as something else than being definitely in a bubble. I myself say that it is in a small bubble with potential to become much bigger, but that does not matter here.
The amount of PM related in the fund is a laugh in comparison to the rest of it, eg POT. Yes, the fund also bought a stake in an Australian platinum & palladium miner in October or was it November. I would be glad if somebody updated me on it, just for the fun of it. I do not make any decisions based on that fund.
If I have understood it correctly Mr Soros himself does not manage the fund himself the way he used to. Comments anybody?
Lastly, I find him an interesting guy in this world of finance. So yes, I like to listen to his opinion and consider him a smart guy. Media is media and often just full of ****. His old classic "Alchemy of science" is worth reading.
Whew !! . That was a Lot of shares in the last 20 min....
....
WIR oddity
I was looking more closely than normal, and noticed WGW still listed as a miner. I would suggest replacing it with NGD, since they were taken out by them in 09.
Re: Anyone home?
Been watching, ALL day... took some positions in Large Caps.. too much positive small-cap talk on bubblevision... watching the tankers Real close...
Re: The Euro, Geoge Soros, Reuters
Ballena,
You are correct in your assumptions. See my post.
http://caracommunity.com/content/bill-cara%E2%80%9...
Strathmore
Hi All - Picked this uranium explorer up recently, and over the last number of sessions it has come around a bit. Bought on the strength of reported pounds U308 in various properties, but not much else in the way of technical due diligence. Happy Trading
Re: WIR oddity
cheapy,
I have been busy making changes in the time I have available.
Yes, I'll add NGD. I first have to make numerous changes to the Cara 100, and then I'll re-set the tables and the chart links.
Re: Anyone home?
LOL!
Yes people are reading this blog. The only thing is this blog is all about people stating facts or opinions, but with little meaningful feedback or discussion. When people ask questions, most likely than not, questions don't get answered. Consider yourself lucky.
Re: Anyone home?
It was rhetorical :)
I was referring to volume or the lack of.
Re: Anyone home?
jack black,
The characterization "only thing" is a bit strong. I see plenty of discourse. There are questions being asked, and if they are directed to me, I may not see them for many hours, or maybe even, I'm just too tired. That happens -- I worked all weekend. Maybe I just prefer not to answer. There was a question late in the afternoon, for instance, that I didn't answer because I was too busy and also because I'm not this person's investment advisor. The question called for judgement, which can only be provided by an advisor who knows all the facts. Since I knew zip, I declined to answer. Also, there was a presumption in the question that I disagreed with. I didn't necessarily share that analyst's opinion, but I thought it should be put out there for the record. I have stated repeatedly here that I often republish the opinions of others for discussion purposes among yourselves. A couple days ago I said I was pleased with the discourse here, and today didn't change my opinion.
Re: Anyone home?
S'okay Bill, we're your fans and trusty sidekicks.
Most of us "lurk".
But we are all here, not every minute mind you........................
Something strange in today's market, but I can't put my finger on it.
Stocks that should go down, MAGNA for example, see steady , unwarranted growth.
Other's climb and fall will swings that are too great,
yes, yes, the vagaries of the market, but there are times that a conference call might be useful.
Re: WIR oddity
Yes, I'm sure. I just figured I'd better mention it since I would be one that cares the accuracy on miners, and I know you care about everything you put out.
I do appreciate the thought and time you must put into it. Most reports like that I've seen are all just generated data after the 1st page, but yours has actual thought, page after page, analyzing and reflecting on the data presented.
gold up stocks down
just patterns, but that is what they suggest. Falling volume up to res.
How I see the Market Performing
I still think we will see limited upside gains and that we have more downside risk in the markets. I know the overall skepticism lends the upper hand to the bulls, but I think that traders and investors have swung to a more cautious approach following:
(1) a 9% drop
(2) debt problems in Greece and other European countries and Dubai
(3) tightening in China
(4) a hint of tightening in the U.S. (whether or not it happens is not the point, it's the sentiment surrounding this possibility that does)
If one were looking to get short, this is probably a decent time to do so, at the 50 DMA after bouncing up from an oversold condition.
FD:
Long GE, LIZ, NLS and a couple of others and 25% in cash
New Version of Market Analysis Spreadsheet
Hi,
I keep finding better and more efficient ways of using the Add in.
The load time for the sheet is now between 30secs to 1 min.
I have linked Stockcharts.com charts directly to the spreadsheet and got rid of the mini chart. Quick load and you can't beat displaying proper charts. If anyone is using these please let me know what you would like to see.
It now allows me to quickly view the day as it progresses all on one spreadsheet.
Cheers
Re: TRAK capitulation play
long at 14.16.
Do your own homework.
Re: Anyone home?
"Something strange in today's market, but I can't put my finger on it."
Thought I share this. Top chart is an hourly from Feb low. The bottom chart is a daily chart from Mid August- Mid Oct 2007.
1190 looks like a good target to me.
As I look at the daily SPX chart of recent (and I have been wrong lately) http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=4&dy=0&id=p88351203387 it looks to me like an upside down head & sholders in progress. The formation looks like we are at the very bottom of the head. A measurement to the neckline is about 80 points. If it were, the expected time to its completion would be close to 18 days away. A 80 point move. Who can trade this profitably unless you are a swing trader. Im looking for the dip and Im going long for 100 points in 50 days. 1190 would be a new high off Marches' low and every one would be happy. Governmental policy doesnt change. Inflation is a problem to somebody.
US media vow to "grow up"
Crew of "Good Morning, America" are determined to produce a "news show" - without any help from grownups (per the Onion)
http://www.theonion.com/content/news/scrappy_crew_...
Re: 1190 looks like a good target to me.
I see it. But we have to clearly hurdle the 618 fib and 1150 1st. And 1 thing i have learned since i learned H&S, is a high % of H&S fake out before confirmation or fail. Too many people I think have caught onto this pattern.
would like to hear everyone else's experience with H&S. Thx
Re: US media vow to "grow up"
They really have no choice! Bill C mentioned a very foretelling event occurring before our eyes. Networked TVs!
You will soon have Anti-Cramers who are more popular and get more views on a 70"LED tv's via Youtube, than Jim Cramer himself!
I can envision a 'Joe the Plumber' show that is aired live right after Jim's show, making counter points for every word Jim utters. Or how about a post Presidential address show every saturday?
Media Moguls are in trouble. the Internet + Youtube + live streaming + Networked TV + mobile video adoption = dilution of market share.
Booyah!
EDIT: Here is a perfect example ripped from today's headlines.
"Networks Wary of Apple’s Push to Cut Show Prices"
http://nyti.ms/b283u3
So apple is sticking to the networks because they own the screens, pressuring prices down. TV screens are also a separate entity from your cable bill, thanks to the Internet.
Olympic afterglow and Congress gets it?
Just guessing the North American fixation on Olympics could have people seeking enthusiasm elsewhere. Certainly some surprise upsets in the team (ahem) sports.
On the other foot, it seems we are hearing from CONgress an odd occurance if news posts can be right...Republicans ACTUALLY voting with Democrats on a flawed but urgently needed Jobs Bill!! Yikes: the us/them theory may have to be abandoned if this keeps up!
http://www.huffingtonpost.com/2010/02/22/jobs-bill...
Secret AIG Document Shows Goldman Sachs Minted Most Toxic CDOs
http://bit.ly/9JgcVR
When are they going to go after these guys?
weird formation on 60-min U$D futures chart
http://futuresource.quote.com/charts/charts.jsp?s=DX%201!&o=&a=V%3A60&z=800x550&d=medium&b=CANDLE&st=
I'm not TA expert, but It's either H&S or U$D is giving us a huge finger.
Edit: Looks like a finger after all as futures are going up again.
European banks face showdown over €1 trillion of debt
"The bank has advised clients to prepare for chillier times as monetary tightening begins in the US and China, causing major spill-over effects in Europe.
Roughly €560bn of EU bank debt matures in 2010 and €540bn in 2011. The banks will have to roll over loans at a time when unprecedented bond issuance by governments worldwide risks saturating the debt markets. European states alone must raise €1.6 trillion this year."
http://www.telegraph.co.uk/finance/newsbysector/ba...
Facing a nearly dead day yesterday, you gotta wonder how much these trillions of dollars of debt rollovers due are scaring the crapola out of everyone. Lehman Bros. for a rematch anyone?
Re: New Version of Market Analysis Spreadsheet
Otoko, I finally got the spreadsheet to work.
It looks very promising.
grinding through and clicking dozen of charts on my TOS trade platform, is a terrible use of time to get a grasp of market status.
Your Excel could be a real breaktrhough. Will beta test, but may take time, as I have none of that right now.
Cara 100 Ratings Changes
Good morning.
FSLR - Wunderlich Initiates Coverage with a Sell. PT = $90
Anyone shorting Toyota?
Fundamentally it's a good idea: http://www.autoblog.com/2010/02/22/video-smoking-g...
but charts look like TM is bottoming.
Another smoking gun ...
And still no one is held accountable. Outrageous.
Secret AIG Document Shows Goldman Sachs Minted Most Toxic CDOs
Re: 1190 looks like a good target to me.
Of course no one knows where the market is gong. Its a simple observation, a simple measurement, but it has some merit. Im expecting that if another sholder develops it will mean to me that there is a good chance to see its expectation and Im willing to consider using it in my trading. I dont place an undue weight on chart formations. They are useful though. Trends and inflection points are useful.
Re: Cara 100 Ratings Changes
Meh ... so FSLR failed its "Wunderlich" test, eh?
Re: Out for now
As others have already noted, the market wasn't too keen on moving higher yesterday and so my remaining short position held its ground. I actually added to my position at the close.
Bill is, as always, spot on in his analysis of where things stand. The bulls need volume to push this thing higher and there is a lot of risk right now.
Cara 100 Update
New Coverage:
NOK - Stifel Nicolaus Initiates with a Buy. PT = $16
RIMM - Stifel Nicolaus Initiates with a Buy. PT = $90
Re: Another smoking gun ...
SEC is too busy investigating Toyota at a moment. First thing first ;-)
http://www.msnbc.msn.com/id/35520628/ns/business-a...
Re: Another smoking gun...
Once again Teflon Tim strikes again!
With the revelation that the NYFed held back the release of, or "The identification of the securities in the document known as Schedule A" some $62.1 billion of the most toxic CDOs (of which Goldman Sachs was responsible for $17.2 billion). It would seem that when Timmy was testifying to Congress he could not, or would not acknowledge any of the questions specifically asked on this issue! Again I say whats needed to clean up this swamp is Indictments!