This page has been archived and commenting is disabled.
Fibonacci Last Seen Entering The Great Chinese Casino
The Shanghai Composite at a major technical crossroads (also, does anyone else find it funny that in less than 3 weeks China has been officialy relegated to a Bear Market)
»
- 9425 reads
- Printer-friendly version
- Send to friend
- advertisements -
Pig Ghosts and assorted spirits on high alert!
It's all mental and about confidence.
Row, row, row your boat . . . hey, what's that big pillar of mist over there on the horizon? Eh, no worries.
anyone see this site?.. good articles 4 slow news day ..http://www..
hat tip: finance news & finance opinions
Give it a rest with the fibs... FXI is fine, minor trendline breakage... wasss everybody whinning about
nobody forced you to click on it, wasss with the negativity
H-shares index is only down about 10%. Will it confirm or deny?
Yet FXI isn't Shanghai. Huge diff.
oil up+DXY down=China down
Sure, sure, Cost of oil and doing business up. Stocks...up? That number seems suprisingly fake. So, if the cost of energy rises, that begets a rally?
If you do yourself a heatmap or IMAP, energy is the leading sector in the S&P
i am tired of hearing all the reports about today's action being about the DOE report and bullish feelings around energy and materials. apologies, but that does not explain the mid-day spikes. not in the slightest. there was an upshoot at 1030 when the report came out, because the energy equities were obvious benefactors of the report...
but whatever happened mid-day is still unexplained. oh wait, nevermind.... we all know what happened ;-)
Options expiration -- lot of open interest at SPX 1000 and SPY 100.
im playing this one day at the time. im waiting for the big drop in '10 and '11 when Alt-A and Opt-Arm start to default on a massive scale. I will build my short positions 25% Asia, 25% Eu 50% US and will invest massively into TBs. It should be a good return, but im not betting the farm, just playing. Yo, Andy, before i forget, any luck with those stocks.
you may want to rethink your massive o/w in TBs. Too much risk to being long duration. Maybe you hoard gold instead?
Alt-A and Option-ARMs defaults are a large reason the CA, FL, and AZ (among others) have sunk so far so fast. Yes it will continue, but the major hit has already taken place, i.e., housing in bubble areas is going to continue to decline, but the decline will not be as steep.
Shadow house inventory is huge in AZ.
The are six houses on my block boarded
up, no for sale/for rent signs, just bank
owned and boarded up. Waiting.......
POA/Alt-A/Prime defaults are going to be occurring at a very heavy pace in CA and the other major bubble states for well into 2010, maybe even 2011. You could easily see the price drop another 20-30% (maybe even more, areas like Riverside are near bottom, but now its the "exceptional/good" areas that will tank) across the board in those states in that time frame.
Any sort of recovery will be long and drawn out, I'd expect a churning slow decline in prices still (if for no other reason than inflation) until 2015 or so, and then you'll probably see a long period of stagnation. Its quite possible a housing recovery won't begin until 2020.
Most people seem to think of that as crazy, but just look at what happened in other housing busts. The one that started around 1990 in the US took until about 1997-8 before prices recovered completely, even after price declines had stopped around 1993-4. This boom was much much bigger, I can't see how it wouldn't be much worse than that.
why this relationship? such a weak relationship. now why does the USD have relationships like this?
why this relationship; 1) historical observation; since the 20% drop began the biggest down days and the most down days were when oil went up, or when the dollar went down, or when both of those things happened 2) because if DXY is -, exports start to look gloomy and thus pull down the entire EXPORT ORIENTED economy 3) if oil goes up it costs more to produce shit in an EXPORT DECREASING environment, or in an environment in which producing stuff is more expensive ( that when DXY does not go down ) 4) the value of dollar denominated holdings decreases 5) Chinese are dropping their holdings ( prime evidence 3.1 % sell that happened last week) that's about it; i can name a few more, but those 5 are the movers.
Why does a drop in USD mean less demand for Chinese exports?
CNY is pegged to USD. Drop in USD = more exports to RoW from China. RoW is where the vast majority of Chinese exports go already, not the US.
Also, higher inflation in China stimulates internal demand.
Not sure why people don't understand this.
isn't that chump change? Is this part of QE that gets sold back to the treasury next week? I wish I were smarter :(
good articles; good articles 4 slow news day ..http://www..
hat tip: finance news & finance opinions
Hey TD, I thought you had CRETIN blocked. This is about the 5th time today I have found him on here!!!!!!
So I guess this means we are either going to have a further pullback to another fib level, or we will go back up. Do people really think that this rally is so solid that it only deserves a pullback to the 38% retracement?
And I think that it is interesting that when the Dow/S&P/Nasdaq had their correction in June/July... the Shanghai steadily rose... now the Shanghai has entered a 'bear market'... and I have to think that as goes China goes the rest of the world.
Not even that right now. The S&P only pulled back to the 23.6% retracement - and that is 23.6% off the LAST leg up - not off the entire runup since March 9. Seems to me - historically - if the market hits a primary (and significant) Fib retracement, pullbacks usually hit primary Fib lows from the primary move - not just Fibs from the last leg up.
But hey, with Timmy & Ben driving, who the hell knows???
another observation.
Based on the immense selloff, wouldnt we expect a bigger than .382 or .50 retrace as a natural bounce?
add to that the PEF (Performance Enhancing Fed) we could squeak up to .618 before the hounds are released.
Actually, I agree to some degree. However, here is the dilemna...
If the rally is a bear market correction, we will have 3 corrective waves before the next 5 waves down. From this perspective, it appears we have already completed 3 corrective waves up and are therefore working on the 1st new incident wave down. Bottom line, we move FAR further down than just a 38.2% downside retracement and completely miss any further moves up. With all the mixed (mostly negative) news lately, we will likely need - even with Ben & Timmy's help - a major catalyst to drive us back up to and past the 38.2% retracement to the upside. Considering all the looming CRE, Alt-A & Option ARMs and continuing suffocating consumer debt, it does not look likely - even if unemployment starts to level off.
OTOH, if this is a real bull market, we are now on the 4th wave. And before the market can move to the 50% Fib retracement to the upside, my bet is we will have to correct down to at least the 38.2% downside Fib - of at least the last leg up. Considering the market remains significantly overbought (and has been for awhile), my guess is there is too much upside resistance in the short run - again, despite direct Fed intervention - to move up until the market works off some of the over-bought pressure. If the Fed has the ammo, it is possible the market might move sideways until it hits the 38.2% Fib arc down before moving up.
Either way, without a major correction in the next few months to ease the severe overbought conditions, the 61.8% upward Fib retracement seems unlikely. My guess is inflation (if not stagflation) will rear its ugly head sooner than we will see a 61.8% rise.
Just a thought.
China went from pulling the world out of a recession to a bear market (soon to be depression)....and all in 1 week. Hmmmm?
And was looked at as long as it was going up and supportive, but totally ignored and fall dismissed when it doesn't suit.
The US has a very selective awareness LOL
The closer we get to the end of the Mayan calendar, the more time accelerates.
http://www.13moon.com/prophecy%20page.htm#
or so this guy who wants to change the world's calendar paradigm to a lunar cycle.
oso grande, no bueno por caca, pinche baboseo chinga madre, chicoms pendejo.
Oso MUY Grande!
gayette mamas juay...
What will be US markets after OpEx? I wish I knew.
Okay, that's a great title :P
The Fibonacci Code would make a great movie
Not sure if you have seen the movie Pi - it's good and based on the golden ratio.
That movie was good? Maybe I needed to smoke some weed before/during or watch it much later than 3 in the morning. I couldn't get past the bad acting and jerky plot.
There are few movies I rent and stop watching after 15 minutes. Pi was one of them.
A superb catch from Denninger:
http://market-ticker.denninger.net/archives/1350-Whistling-Past-The-Grav...
$22 billion?
isn't that chump change?
Is this part of QE that gets sold back to the treasury next week?
I wish I were smarter :(
$22B is chump change for GS alone. With $788B in cash (wait! where have we seen that number before???), my guess is the $22B is low cost ammo for Ben & Timmy to spend on futures and selling USDs.
If GS & the other major banks were truly afraid (exactly why, again???) of the market tanking, my guess is they would be parking a sh!tload more cash with the Treasury. Of course, that would presume the banks were to actually ACT like bankers - you know, risk averse and all that.
OTOH, at least GS - with their IB background (did someone say they were actually a BHC these days???) would more than likely be shorting the market. Of course, since they do NOT frontrun at all (for shame!), we are not exactly sure when they would flip all their positions.
With $22B in low-cost cash in hand, I'll bet Ben sees plenty of green shoots wherever he chooses to look!
vbg
good pointgood articles 4 slow news day ..http://www..
hat tip: finance news & finance opinions
Substitute with IFN. Viola.
Yes, it is funny that this morning's headline was that China entered a bear market! Ok!
Bill Fleckenstein's take on that today was:
Last night the Chinese market plunged over 4%. That index is now about 20% off its high, though still up better than 50% on the year. Which of course poses a real conundrum for talking heads on Bubblevision: Do they describe it as a bull market or a bear market, since they have this silly notion that a 20% decline equals a bear market?I love how everybody complains about the PPT stateside but then they jump up and down betting on Shangzang red chippo deluxe where the PPPT as in Peoples PPT has powers of magnitude more gas to blo the SH comp any WHERE it pleases- up, down, sideways, whew, talks about betting against the house...
I am looking to Taiwan to confirm the Shanghai bear. Not only is Taiwan one of the few places Chinese nationals can park their money outside the country, but it is also the most expensive market in the world on an earnings multiple basis. So far the TAIEX has stayed flat during this downdraft. If the TAIEX were to follow Shanghai's lead that would be the bell ringing announcing the end of the EM/risk trade.
I believe China is singlehandedly forestalling a global deflationary spiral with their stimulus and marginal purchases of just about everything. So it makes perfect sense to look to the Shanghai equity market for clues as to when that spiral will resume. But it remains a closed equity market and thus has very limited value in predicting broader global market moves, at least on an intraday basis.
I agree and thanks. Watch TAIEX very closely.
Lately, NTD is devaluing with respect to USD. This could indicate that TAIEX cannot hold too long.
looks like TWSE topped on 7/28 and is down 5% since, but that move has been mostly since last Friday (-4%). let's get this party started.
When the shit hits the fan and the markets tank 30% in a week.
CNBC: Well. It happens. It is what it is.
Translation: GS wants to take the markets after sucking in the herd. Expect that. Theres nothing you can do. Government is watching their backs. Expect them to take the markets up again when the fools are selling indiscriminitely
this is funny:
" Aug. 19 (Bloomberg) -- Crude oil rose after a government report showed that U.S. inventories declined the most in more than a year as imports tumbled and refineries increased operating rates."
Nooo, that is INSANE! there is so much of f. oil around that they decreased imports...someone will get burned on those 120 by January forecasts.
"sanity" will probably continue for another week or so, till the big boys turn around so our favorite show "dog eats dog" can reach an apogee.
This is short squeeze until you see a blow off top. up side capitulation is needed before yogi bear comes out of his hibernation looking for someones pickinck basket.
I am a tech guy and i really need a mirror image of what the spx looked like last oct or this march. I need hard upside moves on big volume four or five days straight through the upper bolli band. High confidence, and everyone is happy and the sun is shining everywhere phycologically in the press. The opposite is what happend in nov and march to flip us to the upside so the same tech applies for the reversal. Bottom pickers came out when shit was horrible and there was no light at the end of the tunnel, we capitulated and reversed. I am waiting to see this and i know it is going to happen soon. but i need to see the tech happen like how i describe above in order to act. remember, this thing will only flip over when everyone is super confident that things are awesome and i see 4 or 5 days of action through the upper bolli on high volume. Until then, were still moving higher i am afraid.
What I don't understand about this Fib stuff is, can't you just move your time window and increase and decrease its size until you can fit any curve into bouncing off these various ratio walls????? Big fan of TD and this site but some of this math magic seems a little contrived.
It does look like you could adjust the annotation until it fits (self fulfilling) but fib retracement is based off of the ratios. 0% and 100% being the "complete move". Plotting 95% of a move is not utilizing the theory/annotation correctly.
But who defines what the "complete move" is or where it starts?
I think the central banks of the world should close down and move to las vegas. There actually they would be close to each other and business would be much better....
You're right in your assumption that the oil companies does not see any future demand in oil. This is one major head fake.
it's funny how quickly the bear rises from slumber....made me think of this quote...
I quote Dan Aykroyd
"Think big, think positive, never show any sign of weakness. Always go for the throat.
Buy low, sell high. Fear? That's the other guy's problem.
Nothing you have ever experienced will prepare you for the absolute carnage you are about to witness. Super Bowl, World Series - they don't know what pressure is!
In this building, it's either kill or be killed. You make no friends in the pits and you take no prisoners. One minute you're up half a million in soybeans and the next, boom, your kids don't go to college and they've repossessed your Bentley. Are you with me? "
Glad to see some ink on technicals, and the comments. I'm surpised we don't see more.
how come the FXI (china's ETF that trades here in US) hasn't seen as dramatic a drop? basically unch today..
First, FXP shorts only Hong Kong-listed shares, which trade at much lower multiples than their mainland-listed counterparts and with a surprisingly low correlation.
Second, FXP shorts only the "FTSE/Xinhua China 25 index," which as it says is only 25 stocks. It is important to note that there is absolutely no way of shorting mainland-listed shares. Investors cannot short individual shares, and there are still no traded futures that would allow investors to short the indices. As a result, there are no funds through which investors can short the China market.
Retracement stops here. Chinese central bank halting recent trend of monetary tightening (not exactly loosening, yet). One more leg up before the end of September. Perhaps a merging to the 50DMA, for effect. Look for DXY to get down around 76 as risk is just a whistlin' and a skatin' upon Flooring By Fed. A river that flows uphill.
Row, row, row your boat . . . hey, what's that big pillar of mist over there on the horizon? Eh, no worries.
hahaha
error
I think the "short China" ETF is FXP not FXI...
Jim Cramer and Alix Steel
NEW YORK (TheStreet) -- Fifteen percent of stocks should
pull back with Chinese markets but the rest of stocks
should be in the clear.
http://www.thestreet.com/story/10582887/1/stocks-ignore-china.html?puc=_booyah_txt_pla1&cm_ven=EMAIL_booyah_txt
as long as they keep crushing the dollar, the markets, gold and oil will rally.....Nothing else seems to matter....
The US markets are holdign up much better because China doesn't have Goldman.
good articles; good articles 4 slow news day ..http://www..
hat tip: finance news & finance opinions
Go long, Cramer is bullish. Might as well, he and Kudlow are the only ones right. Pisani says it' a positive for the bulls.
Perhaps while looking at the fibo ratios on Shangai, you'd also like to look at the 100 day (or 20 week) simple moving average.
FWIW, its at 2835-2850 on the Shanghai and for all those model funds out there, think its pretty crucial that it reclaims those by the weekly close tomorrow.
TD: "does anyone else find it funny that in less than 3 weeks China has been officialy relegated to a Bear Market" This turn is quite logic. Large parts of the chinese stimulus disappeared in the stock market. The government announced investigations concerning these practices. Therefore the investors have to withdraw their money from the stock market. Unfortunately I was not clever enough to short this effect last week. I was just trying to figure out, when this will push the stocks down. It pushed the down immediately.
What happened to Cheeky's china shorts last night?
still here