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Frantic Buying Takes Market Over 10,000, June NFP Miss Now "Priced In", As Is Double Dip
There are probably a few words available to describe just how "forward looking" the market is, as it has just taken out the horrendous June 29 NFP number, and the plethora of ISM and other assorted negative news since then. Fundamentals don't matter, just carry and leverage. With alpha now dead, we hope at least massively leveraged beta plays continue to provide some benefits to whoever is left trading.
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Pull up a SPY daily chart and look at the below average volume for today. I know volume seems not to matter anymore but when I hear more and more people say that The more IMO it does matter.
If you look at that daily SPY chart use a line chart and see how today we returned to the broken neckline in that big head and shoulder top. And the return was on light volume thats text book.
This looks like a text book return to the head and shoulder neck line.
http://stockcharts.com/h-sc/ui
So looking at that chart, and applying textbook rules, see you at DOW 9400 by the end of next week, just as I stated a little while ago.
?
http://www.pdfli.com/33247/edwards-and-magee/
pigeons whirring, bobbing and spinning their heads and necks, invoking another feeding (or so they believe).
Perhaps we need to move all the indexes and trading into Second Life. After all, most of these traders are creating their own reality.
The rest of us recognize the unambiguous signs of the slow down. Even if we didn't, the fiscal policies coming down the road by Obama and Co are going to destroy profit margins.
And nothing has changed about the debts of California, Illinois, and New York. California alone is enough to have a major negative impact on GDP.
I am unsure what these economists are basing their rosy outlook upon. They have obviously never held real jobs. Ask yourself how many new employees the average small business is going to hire if growth across this nation is a mere 2.5%. For a business grossing $500,000, that increase would not even cover a part-time employee.
Second life! Hee hee. So true, they've created their own virtual market. Geez, quit the game folks. You can't win in the long run, they will take it all.
jkruffin, I concur, DOW around 9400-9600 by end of next week but they are pumping it right now and the trend is your friend till it bends you over!
The one thing that can blow the head and shoulder top apart would be great earnings. And we all know were back to Enron accounting standards. The CEOs may be afraid to fudge the numbers though.
If you don't have to own equities, why would you ? Valuation not cheap on too bullish consensus forecasts, and corporate warchests will get 'liberated' sooner or later. Don't kid yourselves. Punt kneejerk rallies if it makes you feel good, but I defy bulls to show me its a good risk/reward idea. Preserve your firepower, wait for vol to fall some more, and then back up the truck on the short side. Patience...
Look, if someone wants to play in this market, be they long or short, who cares? And if they make money, great!
But all here should realize there is no connection between this market and the real world - it is a casino, with shiny lights, and long-legged waitresses taking your drink orders ("Make mine Kool-Aid, please!"). There is no relation to real facts, real fundamentals such as where is the economy going, etc. But no sense beating each other up about it. Knock yourself out if you want to throw a few chips on the table. And for those who think the game is rigged, and I agree with you, stay out.
If anything, I am starting to believe the ups and downs of the equity market are in and of themselves a distraction, and are nothing but a coarse reflection of the "real" action in the vastly larger currency and debt markets. Equity is just the thin coating that waxes and wanes as those markets move and shudder.
Thats what i said and i got a nasty reply. If you dont trust the Market, Stay the fuck out. Invest in Girlscout cookies
It is interesting where mortgage purchase applications are at this point. There has been a rather persistent decline since the beginning of May and those lag the pending home sales, which of course saw a massive 30% decline for that month. It means we are not only likely to see Existing Home Sales for June under 4 million annualized and New Home Sales around 250,000 annualized, but even more declines from there appear to be on the way. We could be seeing some obscenely low figures for the housing market over the next few months that are sure to send this whole thing crashing down.
True words, as we watch the housing data at my shop like hawks and are looking for a new bottom and wonder if "up" will ever show its pretty little face.
240 million DOW share 300 or so point rally has to be candidate for the lowest volume/largest rally in history. Last similar rally was on 350 million shares, the rallies are dropping in volume.
Ok, i've decided i can't put it off any longer - here it is ...
Scary DOW monthly chart.
http://stockmarket618.wordpress.com
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