well that was the mason dixon line.
Friday, January 23, 2009
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2009
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January
(317)
- ugh...
- Goodness
- Go Claire!!!!
- Some local macro
- well
- Trying
- For the life of me
- I smell bear
- consolidation
- Bob Pisani
- Befuddled
- So...
- some stuff
- grr
- Ugh
- Melissa lee
- END of the month
- trade channel
- I know that you need an update
- hmmmm
- some trade channels for ya
- target
- wedge
- 85
- roughly
- well
- In other news...
- Toying with the first one
- Where are we...
- I don't know
- well
- some formations
- Comment
- Hey... You got a chart this morning
- there is a wedge
- You want another Half glass on banks
- Some stuff
- Crank
- sentiment shift
- Word is
- On my haunches
- Awwww
- The Plane!!! Boss, The Plane!!
- Laid up
- Sidelined
- IF
- finding some support
- only read I have
- USB
- Oil, construction... Autos???? metals.
- that is ominous
- ok
- That is it...
- 85.50
- seems like
- Back to 84 again...
- breakout to the pivot
- Economist Paul Ryan
- Morning
- Some morning reflections
- 2 wedges and a flag
- Tired
- This is what I have!
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- there is a resolving wedge
- mason dixon line
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- Goodness
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- FOOLISHLY
- we need that higher high
- back above trend
- there is that trend line again... also slightly no...
- after yesterday
- well I said fuck it
- lets see
- Sorry
- we are going to hit the trend line
- No title
- I'm still not convinced
- bulls have to hope
- well
- here is the trade...... but ... I'm continue to be...
- some banks
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January
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21 comments:
Faked us both out, next stop 84.
I was about to update that it had set up as a bear trap...
but.... don't trust it...
there isn't enough conviction IMHO
Break out coming to he upside?
you called it, but.... I'm just having a hard time buying it.
yeah, especially on a Fri... maybe not 84, but it should touch 83.40
There's your 83.40, now let's see it break out to 84...
God, if that didn't jinx it, Ha!
watch out... I feel my mojo off.
so...
no better day to short cover than friday..
but I like what t-lo says..
we may just melt down for days and days and days.
Little rallys that suck people in
Yup, I'm picking out my favorite pair of shorts for the weekend, if you know what I mean.
Beautiful call on the RIG... nicely done. Hope you got a bundle.
I can't even think right now.
Hey... The thing that you sort of miss is that a trend line can be broken, and it almost always finds support resistance there.
So breaking it, can set up like a trap.... That is what you want to look for.. You look for the trap, then wait for the trap to resolve.
This trading has been Nutty..
and I don't know what to think about it.
I guess I'm missing your point. It seemed to work out well... broke thru resistance to the upside and stalled at 83.40 for a while (which wasthe next resistance)... then as predicted, it printed an 84 at 2:03pm (EST) before coming back down.
Wasn't this textbook, or am I missing something?
Also, WFC had a daily high of 16.15, just at the resistance level I mentioned in my blogpost... but it didn't break thru. I'm going to talk about it later.
You just said it was a fake out.
I wish I paid more attention to Horizontal support, but my brain works better other ways.
Just because something "Breaks a Trendline", is only something to note. It's the reaction after that is important. Mostly we keep breaking uptrends and downtrends.. It does seem like we break 2 uptrends for every downtrend.
I may do a post about this this weekend.
When I said "Don't trust it" I was talking about the potential for an upside break out of(above) the 84 level.
since it was setting up to resolve at that level.
I just couldn't play hard today.
WFC.... See the banks as some notice were strong, but some of them broke out tuesday and have been downtrending sic, and have been downtrending since then.
One can even say some of them have had their own mini bull markets since monday/tuesday.
On the positive side... the moves in oil make me suspect some upside action.. but after some mini breakouts today... they could downtrend like the banks.
I have a mini thesis on commodities. as much as we are scared of "whatever", Europe and asia seem twice as scared. The U.K. is looking for a credit downgrade.(why are they so on top of countries, and so behind stocks(fundi's must be easier nationally).... but I digress I think asia and europe are in enough of a panic they are jumping into commodities, as a safety play.... They won't touch stocks, or treasuries, so now it's commodities as an asset class.
Or not.
I agree that the breakout to resistance was going to be anemic, but it sure looked like it would go to 83.4 or maybe to 84 and then pivot downward. I had a small amt of SSO a the time and was looking for my exit... I didn't want to try to top tick it so I got out with SPY at 83.4
Your points about commodities are well-reasoned. Isn't this a flight to safety of sorts? We're sort of running out of asset classes to trust and all the liquidity has to go somewhere. A lot of people are saying the US dollar will benefit, but gold is/was extremely oversold and was due for at least a technical bounce. And I would add that commodities tend to move for prolonged periods of time and tend to overshoot both on the upside and the downside... at least that's the conventional wisdom.
Not to pat myself on the back too much, but if you look at the blog post about banks and biotech:
http://kalamazoopost.blogspot.com/2009/01/banks-dont-bank-on-em-for-long-haul.html
I had specifically mentioned in that post the holdings I own long: GERN which promptly went up 34% at the open, as well as GLD and SLV which both jumped 4.5%. I also own gold miners (GDX) which did even better. It's all about the risk/reward and the risk with precious metals is pretty low.
Sure, I guess we can struggle with WFC and try to figure out which banks will survive, but why take the risk especially when there is no transparency in the entire industry. HCBK and WFC may do well in the long run, but the reward might be way way down the road.
I'll look forward to your thesis.
Good lord....
In a perfect world, the thing to do.. is look for the break of the trend line, Watch for it to "Retrace along that trend line/Play with it".
Set a Stop with good clearance below the break... or a mental stop, then when and if it starts gaping up, to put a follow stop on it. T-lo uses the retraces as stops. So you would have Stopped out at the trend line break out, then on the break out moved it to the top of that retrace, then waited for the pull back at 93.5 then seen it gap up again, moved to stop to below the 93.5 retrace... Moved it up to the top of the 93.5 retrace... then maybe seen the wedge resolving and stopped out.... All while watching your cash go up and down, and your heart beat madly.
One frustration I had on friday was that I set the stop, and somehow called it a market and not a limit. on one of the things I was trading, Left a good 7% on the table.... but it's just fatigue.
That and I usually don't use stops but did because I was tired. and it became a self fulfilling prophecy.
It's not like I don't' watch RIG..
You know I like pointing out Conundrums; and If Deflation No gold and oil. If no deflation, then WTF are we doing?.
Re:lequidity, this is a global lequidity crisis. So, when one talks about how "Liquidity has to go somewhere" Problem is... there is no liquidity. And when Gold went to 1000 there was about 2x as much liquidity as there is now.
That is the reason for the problem, lack of lequidity is makeing every dollar more valuble, which continues to crack the system. It's not that Oil is Cheeper, its that the dollars the buy oil are more valuble.
That is what deflation is, is lack of lequidity. The question on peoples mind is "Does the fed have enough "Go Juice" to reliqify the system.
To be honest, I don't think they do. But as Mortgages are paid, more lequidity does come into the system... it just may take the length of the mortgages... 30 years.. which makes me realize the reason for these 30 year cycles. or one theory.
and again there is the horror show, not only are there an oversupply of homes, but the value of the dollars to pay them off is going up... so not only is the house worth half as much, but the dollars are twice as expensive.
One thesis on Inflation is "too much money chasing too few goods"(not that I agree with this simple thesis).
But as larry would say "The problem was TOO MUCH CHEEP MONEY", and that is an inflation cycle. But that is what we "had" as Ibanks went to 30 to 1, and other banks had to compete, all with the fed being afraid of the 2000 cycle.
Rogers and Schiff are smart guys... So I give them their credit... and don't put myself there.
I would just say, we have a conundrum and we will sort it out. But you are hearing how there are Tankers and Tankers of oil off shore waiting to come in, and the oil storage at Cushing Oklahoma is Stuffed.
So... Yes, just like every time people are in panic mode and driving commodities up. It's interesting how detached we have become from Europe and Asia, for the past week.
You also know how crazy we can become.. Remember oil calls at $200-400?
I heard cramer talking about how he thought oil was bottoming before, and because nobody was saying it, that it was a bottom. I hate to say, but we had about 50/50 bottom callers. T-lo likes to call bottoms.. What if we have a nice break out here that suckers a zillion people in... Then the hammer comes, people start talking $10 oil... there is some Devious thinking.. Every body keeps talking about the downtrend in oil and gold... and yet.. what did we just learn.... After the breakout of the trend... Then you "start looking for the move... This oil/gold break out will probably retrace back down, Could make a "higher low" or a "Lower low".. Just pure T.A. There.
You do understand I'm just supposing here.. But to add to my suppositions. If there is an inflation cycle... it's still down the road... Once we get through the "Crisis" then we will see if the Fed Keeps the pumps going.
This is what is lame, For the economy, what they need to do is slowly put the brakes on. Raise the rate .25 every 3-6 months... Of course this Quant easing is another way to do it... but the best thing for the economy/market would be just a sideways stability for 7 years.
Just some thoughts
I thought it was very odd that the same day the oil inventories came out with excess everywhere, oil goes up a few percent... seemed counterintuitive... but consistent with an oversold bounce or even a bottom (but calling a bottom is way out of my pay-grade.)
I think some traders jumped in because they read this a bottom-- we won't know for a few weeks. I'm still not sure what you saw in RIG's chart, but I commend your call.
Liquidity: There's more liquidity today than there was 2 months ago and nobody is going to give it away. No loans, no mortgages. So it has to somewhere. Sure relative to two years ago there is very little liquidity, but not compared to 2 months ago.
GLD has gone from 68 to 88 in 2 months-- that's a bull market in anybody's book-- only TLT comes close and the technicals on TLT aren't as good.
Is TA any good for GLD? Maybe not since so much emotion goes into the gold trade, more than any other asset class it seems. But nobody can argue that the year long trend has been broken. What happens now is only a guess. It's risk/reward.
New liquidity will be hitting the market and there will be more in two months than there is today. Where will it go? Mortgages, car loans, Treasuries? Maybe, but my guess is that some will go to commodities, too.
Maybe you didn't realize it, but Rig Broke it's downtrend on thursday, and was pulling back. I did a post... which was basically "Watch this",(Maybe I forgot to post it)
with the bearish ness on Friday open, I figured it would have pulled back at the open, but with Oil up $3 above 40 and the market running... With the break out on top of it all, that move was probably huge.
But some days if I look at one more chart I feel like I'm ready to puke, so I still haven't looked at it.
Once again, I haven't looked at a chart on gold either, and will next time I have the charts open I will, but I will bet you, depending on Monday.. or Monday at the open, that the move in gold will end shortly after the Monday open. As the "Weekend warrior traders read some article in barons about gold, and jump in at the open.", Then it will retrace. Maybe back to 870 or 900..(I'm actually not sure where gold closed, but some of the momentum will be gone and the pull back will start....
But that is all I can speculate on, Seems like if the "fear is gone" in Europe and asia and the U.S., the move in gold will have to at a minimum, pull back...
Again, I think that will depend on the fear trade in Europe and asia. as they don't want to be in their currencies, and don't want to be in equities or treasuries.
I haven't been watching Europe, so I wonder if they "Capitulated"
The thing that has my "spidy sense" going on the Friday move in the market, is just that for it to be a break out to 870, it needed to be more violent... though it was strong.. It just didn't have that "Giddy up" to it.
For what it's worth, here's my GLD graph and my lame right-brain analysis:
http://starwealth.blogspot.com/2009/01/gld-update.html
I umn... way too many comments here.
Just for fun... what I hate about gold and oil...
and the stocks... Is that I have to anticipate what they are going to do.
Since they trade 24/7, unlike the associated stocks.. anything can happen in the 18 hours that we don't trade, and it gives me no chance to ... deal with them as trading vehicles, on the market. Gold can collapse $200 and I'm flat footed in a mining stock.
AND...
I had it right, I was long gold 06 sept, in anticipation of the crisis, and the market went down, and gold did too....
then the market went up.. and!!! gold went back up.... WTF!!! Then the market went down, and gold went UP!...
NOW! market goes down Gold goes up. Market goes up gold goes down...
I know what makes the Gold bugs Crazy... IT'S GOLD!!
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