Tuesday, March 29, 2016

Best FED day for patient equity bears

Looks like FED is reading my blog. 
Market took off when this hit the wire today

 <  F'ed has "considerable scope" for stimulus if needed  >


I talked about FED pulling another QE bluff in my previous post , there it is.    First time in a long time FED signaled that it may use its QE tool to intervene once again. At first, this sounds super bullish of course. SPX ran into a massive resistance layer on a panic buying as if there was nothing there.
But this statement now created another expectation other than the expectation for steady interest rates. Market already priced in steady interest rates policy for the year. That is what this whole rally from Feb was for. If todays surge is the beginning of something, it will be the beginning of "sell the news". But now there is going to be another expectation that will be priced in. It is QE4 and we all know FED will not be able to do it under the new administration next year. Ready to play "Waiting for Godot" ? We are going back to the times when everybody begs for QE whenever ES goes 5 handles down.

Bear market leadership has a clear message for all of us:

 TRAN lifetime quarterly


daily close-up


Sunday, March 27, 2016

French kiss ...

Aside from a possibility of a lower high, France is done. Of course, it will be a different story here in US. The land of PPT will resist the bear until the last bluff FED can pull without a quantitative move. And that will make the plunge real profitable in the end.
Understanding what stage we are in will be the key. For our terminator at xTrends Live, it really doesn't matter whether it is a bull or bear, just give him a market he will milk the life out of it.

$CAC weekly

Wednesday, March 23, 2016

The four most dangerous words...

The four most dangerous words in finance are 'this time is different.' 

Dow monthly

Friday, March 18, 2016

Its comiiiing


Monday, March 14, 2016

Tuesday, March 8, 2016

Recent breath trust is reminiscent of...

Recent breath trust is reminiscent of those seen in July 2010 and Nov 2011 but there is also something that is different this time. We are no longer in a bull market, or at least the bull market is not as fresh as it was then. This means we may not see a higher low this time 

As you know McClellan Oscillators went off the scale recently. This is mainly because of the excessive bearishness that persisted for sometime now. In other words, it was short covering as evident from the massive set-backs in short interest across the markets.


Nasdaq McO

McO similarities between July 2010 and Nov 2011

See the weekly chart of NYSE Composite and ST chart of Crude Oil shown in the post below. Oil already hit the target zone this morning and NYSE reversing from the weekly trg. We identified last week that the next downside leadership index will be NDX. 

Excerpt from yesterdays "Opening Comments";

Opening Comments

March 7, 2016 at 1:14 am by Sol   9 Comments

Value Line Arithmetic weekly, self explanatory

One of the downside leadership sectors of the bear market is Transportation Index. It is currently testing a monthly resistance.

$TRAN monthly

RUT which was another downside leadership index shows a similar picture

RUT monthly

Weekly NYSE Composite vs Summation Index, self explanatory

ES is currently down 5 points from Fridays close while CL is up about 2%. I think this couple is now decoupling. Crude oil clearly broke out, it looks like it is headed to 38.5-39.5 range next
CL daily


Looking at the short term charts of SPX and ES , I see a clear rejection around ES 2000 level
ES daily

SPX hourly

ES 240m

I am expecting another range bound day with an intraday lower high around ES 2002-2003. I plan to add NQ short  ES tests this level. If we get an early dip, 

Tuesday, March 1, 2016

Today was all about ....

Today was all about crude oil. We saw crude breaking out last night, sent this out this morning. We went long SP from 1938.5, CL from 33.57 after the open. I think CL has more upside in short term but there is no change in intermediate term picture.

March 1, 2016 at 9:09 am 1 Comment by Atilla Demiray
Crude oil is breaking out...

This will create a short term spike in crude oil and related sectors. And it should also effect SP500 positively in the short term.