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The Volume Story: Convictionless Buying Follows Conviction Selling
Complacency is back with concerns of an overvalued market promptly brushed under the carpet. The sharp downward market trend has reversed today, courtesy of VWAP algos and other low-volume gimmicks. The volume picture is the same we have seen time and time again- selling accelerates on catalysts, while the autopilot move is higher on marginal volume. The market no longer cares about upside catalysts (look at tepid reaction to earnings season), yet give it a negative catalyst and the floor falls off, with fund managers looking for any excuse to sell.
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I agree with your remark re: upside catalysts. When it comes to downside catalysts, though, these seem to me to get brushed aside as well. Look at the way URE performed today -- instead of reacting to the terrible real estate news, it formed a bear trap and ended up almost where it began.
I think the moral of the story is, every day that goes by, fundamentals matter less and technicals matter more.
Everything the market does is a trap, and every reason they give you for the market movements is a lie.
Unless you're a buy and hold investor, fundamentals are largely irellevant. You have to trade the market that you see. Just because you think that something should be X doesnt' make it so.
"Once you have given up the ghost, everthing follows with dead certainty, even in the midst of chaos"-Henry Miller(Tropic of Capricorn)
Incidentally, I am in a very bullish position on the Cosmodemonic Telegraph Agency. All this hurts so much, I have a hard time taking it in. First, I gave up religion thanks to dinosaurs, then the corruption of the political system exposed itself as a pair of stinky panties and now most recently the fundamentals of our economy now appear to be more manipulable the a train station full of teenage runaways.
The chickenhawks are having their day. The pimps, hustlers and thugs have shiny new suits as they sit in their tall offices counting coins and dismissing misery. My years in child protection services exposed me to evil. I have seen it. This coordinated theft is yet another chapter in the incalculable malice of mankind. Decent men are being forced aginst their will into servitude vs. anhillation.
But what really steams me is the ignorance of our population as demonstrated by the instantaneous and overwhelming force used to resolve an interruption in our cable service and the utter ignorance of who the local congressman is. The blame lies elsewhere but the solution is within.
genius.
My favorite comment in a long time. You don't hear Henry Miller's name too often anymore.
inflation is the new king, crowning to commence sometime in the next few months. today was obviously a day in which they let the fundamentals take hold; massive amounts of easy money coming from all printing presses.
Even though we've been gyrating between 1094 and 1098, 1096 pivot being the magnet for today, if you look under the hood of SP500 stocks, there has been steady increase in advancers over decliners. If this trend continues, it's rather bullish as there will be some tension that will have to relieve itself to the upside. Can it all turn around and drop further? Of course.
Despite all the rhetoric, Reid has not filed for cloture, they don't have the votes, yet.
Feels strangely like a bull trap today.
Or if the bulls escape the bull trap and it turns into a double reverse bear trap. I mean it's able to trap in either direction just by arbitrage.
It's intent on making you wrong so it can be right. How it happens isn't important.
agree mule.. looks like a bull trap..
Monday January 25, 2010
Issue 3682
The King Report
This week, Q4 Preliminary GDP will be reported. +4.6% is consensus. This, of course, is a lark. US Treasury tax data continues to tumble.
For Q4 2008, US Treasury ‘receipts’ are: Oct. $164.829B, Nov. $144.769B and Dec $237.786B. For Q4 2009, with only Dec not yet revised, receipts are: Oct. $135.294B, Nov. $133.564B and Dec. $218.919B.
Q4 2008 receipts total: $547.384B – and this was when the end of the world as we know it almost ended.
Q4 2009 receipts, subject to Dec. revision: $487.777B, a decline of 10.89% from Q4 2008. Now reconcile this with +4.6% GDP.
This is why the populace is furious.
I read that over 80% of all the upside since March lows happened on Monday. Buy Sunday open;sell Monday close. Its really simple and will probably continue.
On January 5th the durables report for November was 'released'.
It showed a 0.2% increase. The report, of course, came in the middle of the first-week January market rally.
But now, in the dark of night, the number has been revised - to a decrease of 0.7%. The reason is a claimed "statistical error."
".... with fund managers looking for any excuse to sell."
Have you bumped your head? After all of the criminality, fraud, and malfeasance of the last year (much of which you unearthed), do you really think that fund managers (particularly mutual fund managers) have a green light to sell?
While I agree that the market is manipulated in a macro sense, I believe that most fund managers make buy and sell decision based on funds flow, not government edict. Comments like yours are a glimpse into mindset. It's a very dangerous assumption you're making. At some point, a top will be put in not because of policy but rather because fear will once again overtake greed. We may be there. Today appears on my charts (yours may tell you something else) as a consolidation day with a 23.6% Fib retrace. I will know tomorrow or the next day if the top is in. If we turn at the 23.6 (which is what we did every time the bulls attempted to rally in late 08 and early 09) then I know where we're going. If, on the other hand, we break through 23.6, then we aren't stopping at 38%. I am sure of that. Of anything else, I don't have a clue..... ;)
last time i checked market ended up green but zerohedge continues to bash and keep people out of the climb higher
last time i checked silver had outpaced the market three to four fold, and the doelarr was looking like a confused infant wanting a bottle.
Wow, plus 23 on the Dow. Unfortunately, I already drank all my champagne for New Years. Otherwise, I'd be out partying tonight!
Today was just the correction in a larger move down. You could see the market stall at the channel lines and go down more.
I say we get down to at least 1080 on S&P before this is all done, and maybe further depending on what happens at that level.
Complacency kills.
Somewhere BS Bernanke is pouring gasoline on doelarrs, and smiling.
Nice volume chart Tyler. When you look at the volume moves of GS that adds to the sell side conviction and why all those dollar bulls had best back off their keyboards and start checking out UUP and UDN over the last 30 days. This sucker is set for a dollar and equity roll over breaking their linkage and creating new concerns. I guess the pump monkeys will just have to pray the new Apple Tablet provides an electronic sex doll option that inflates with one key stroke and performs contortionist miracles to insure that the markets do not completely roll over this week.
Market manipulators will keep this band playing as long as possible until the woodwind section is pooped!
So you think ES closing with a ~78% retrace from its daily high indicates buying!? HAHAHAHAHAHAHAHAHAHAHAHHAHA
DOW/SP500 daily charts remain in a downtrend , weeklies are in a weakening uptrend.
My earlier bearish warnings for stocks continues.
My earlier USD uptrend and EURO downtrend warnings continue.
In early 2007 I warned of an impending stockmarket crash.
I confirmed a bottom by early April 2009.
From mid 2009 onwards, I warned of a USD rally (it has much further to go too)
The uptrend since March 2009 has been a bear market rally contained within a much larger bear cycle that started in 2000.
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