ShareThisPre-opening Comments for Friday January 27th
U.S. equity index futures are lower this morning. S&P 500 futures are down 7 points in pre-opening trade. Traders are waiting for Greece’s government and private investors to announce an agreement on Greek sovereign debt.
Equity index futures moved lower following release of the advanced fourth quarter annualized real GDP report. Consensus was growth at a 3.0% rate. Actual was 2.8%.
Fourth quarter earnings continue to pour in. Companies that reported overnight included DR Horton, Altria, Procter & Gamble, Ford, Newell Rubbermaid, Dominion Resources, Honeywell, Chevron and Starbucks.
Starbucks slipped $0.74 to $47.60 despite reporting slightly higher than consensus fiscal first quarter earnings and despite an upgrade by CLSA from Under Perform to Outperform. Target was raised from $44 to $54. Guidance offered by the company was lower than expected.
Celestica (CLS $7.83 U.S.) is expected to open higher after Scotia Capital upgraded the stock from Sector Perform to Outperform.
Morgan Stanley eased $0.33 to $17.87 after Atlantic Securities downgraded the stock from Neutral to Under Perform. Target is $18.
Analysts have different opinions on JC Penney. Piper Jaffray upgraded the stock from Neutral to Overweight and raised its target from $29 to $50. BMO Capital downgraded the stock from Market Perform to Under Perform and lowered its target from $36 to $29. JC Penney fell $0.45 to $40.27.
Wendy’s eased $0.16 to $5.10 after UBS downgraded the stock from Buy to Neutral. Target was reduced from $6.30 to $5.50.
Nucor slipped $1.27 to $42.87 after Deutsche Bank downgraded the stock from Buy to Hold. Target is $47.
Potash Corp. eased $0.33 to $45.48 after National Bank downgraded the stock to Under Perform.
Technical Watch
Atria Group Inc. (NYSE:MO) – $29.00 added 1.2% after reporting higher than consensus fourth quarter results. The stock has a positive technical profile with short term concerns. Intermediate trend is up. Resistance is at its all-time high at $30.08. The stock trades above its 200 day moving average and recently bounced from near its 50 day moving average at $28.44. However, short term momentum indicators are trending down from overbought levels, strength relative to the S&P 500 Index has been negative since mid-December and seasonal influences are negative until the end of March. Preferred strategy is to accumulate the stock on weakness closer to its 200 day moving average at $26.65.
![clip_image001[1]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2012/01/clip_image001113.png "clip_image001[1]")
Altria Group, Inc. (NYSE:MO) Seasonal Chart
![clip_image002[1]](http://charts.equityclock.com/wp-content/uploads/2010/03/image275.png "clip_image002[1]")
Starbucks Corp. (NASDAQ:SBUX) – $47.60 slipped 1.5% despite reporting fiscal first quarter earnings slightly in excess of consensus estimates and despite an upgrade by CLSA from Under Perform to Out Perform. The company also offered guidance that was less than analyst expectations. The stock has a positive technical profile. Intermediate trend is up. The stock trades below its 50 and 200 day moving averages. Strength relative to the S&P 500 Index has been positive since mid-May. Seasonal influences turned positive at the beginning of January. However, short term momentum indicators are overbought and have rolled over. Preferred strategy is to accumulate the stock on weakness closer to its 50 day moving average at $44.87.
![clip_image003[1]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2012/01/clip_image003113.png "clip_image003[1]")
Starbucks Corporation (NASDAQ:SBUX) Seasonal Chart
![clip_image004[1]](http://charts.equityclock.com/wp-content/uploads/2010/03/image387.png "clip_image004[1]")
Celestica, Inc. (NYSE:CLS;TSE:CLS) – $7.83 U.S. is expected to open higher after Scotia Capital upgraded the stock from Sector Perform to Outperform. The stock has a negative technical profile. Intermediate trend is down. Support is at $6.79 and resistance is at $8.94. The stock trades below its 200 day moving average and fell below its 50 day moving average yesterday. Strength relative to the S&P 500 Index has been negative since the beginning of October. Short term momentum indicators are trending down. Seasonal influences are negative from mid-January to early April. Better opportunities exist elsewhere.
![clip_image005[1]](http://www.timingthemarket.ca/techtalk/wp-content/uploads/2012/01/clip_image005112.png "clip_image005[1]")
Celestica Inc. (TSE:CLS) Seasonal Chart
Mark Leibovit’s Daily Gold Comment
Information on Mark’s services is available at
http://www.vrtrader.com/login/index.asp
GOLD – ACTION ALERT – BUY
So many investors and analysts like myself were so shell shocked by the May correction in silver and the September correction in gold, it was hard to accept that silver and gold had the capability (or permission, if you believe the market is controlled) to push back to new highs anytime soon. For now, we’re in a strong near-term uptrend confirmed by all the metals and reinforced by a Federal Reserve that has basically written a blank check for future QE activity. Look to buy dips with a view that the next resistance in silver is 37 followed by the mid 40s. Gold? 1800 and then new highs. Copper is next headed to 4.12 and then 4.50.
Interesting Charts
The Financial Services sector led the decline in U.S. equity markets yesterday. Financial services indices and related ETF completed key reversal patterns on rising volume (Leibovit volume reversals?). Also their short term momentum indicators recording sell signals.
Honourable mention is given to the Technology sector, a sector that has a history of peaking just after Apple reports its fourth quarter results. ‘Tis the season to take profits in the Technology sector!
Tech Talk’s Weekly Commodity Comment
(Published yesterday at www.globeandmail.com)
Following is a link to the comment:
Following is full text:
An Outlook for Gasoline Prices
Gasoline prices traditionally move higher from the end of January to the end of May. What are prospects this year?
Gasoline prices move higher during their period of seasonal strength mainly because of two annual recurring events. North American refiners switch their production from heating oil for the heating season into gasoline for the summer driving season. During this period, production temporarily is shut down and inventories drop. In addition, refiners normally complete their annual maintenance during the conversion period. If something is going to go wrong, it usually happens during the annual maintenance period. Last year, the industry reported six major unexpected shut downs and fires during the February to May period. North American refineries are old and require an increasing amount of maintenance.
The “sweet spot” for wholesales U.S. gasoline prices is from the end of January to the end of April. The trade has been profitable in 13 of the past 14 periods including the last eight periods. Average gain per period during the past 10 “sweet spots” was 24.8 per cent.
Tip off for timing of the start of “sweet spot” is a seasonal peak in gasoline inventories normally between the last week in January and the second week in February. Gasoline inventories at this time of year already are at the lowest level since 2007 except in January 2009 when the economy was in a deepening slump. The seasonal peak may already have passed this week. Consensus for gasoline inventories reported on Wednesday for the period ending January 20th was an increase of 2.2 million barrels. Actual reported by the Energy Information Administration (EIA) was a decline of 400,000 barrels.
Prospects for an upside move in gasoline prices this year are exceptional despite a four per cent decline in demand due to the improving fuel efficiency by North American autos. The crack spread (effectively the spread between gasoline prices and crude oil prices) narrowed in the fourth quarter to an unsustainable level. Chevron recently lowered its fourth quarter guidance due to reduced refining profitability expectations. Tesoro, a major independent refiner recently surprised by announcing an expected loss in the fourth quarter. Analysts are predicting that the U.S. industry will record a loss from refining operations in the fourth quarter. Gasoline prices have not kept pace with higher crude oil prices during the fourth quarter. Prospects for the U.S. refining industry are so bad that the industry has moved to shut down about one million barrels per day of east coast refining capacity. Sunoco and ConocoPhillips recently idled two plants in the Philadelphia area and plan to shut down a third. Together these refineries process more than 700,000 barrels of oil per day. They represent about 46 per cent of refining capacity of the Central Atlantic and New England area. Meanwhile, crude oil prices remain high partially due to international concerns. Indeed, crude oil prices could move significantly higher if conditions in the Middle East continue to deteriorate. Look for gasoline prices to “play catch up” during their current “sweet spot”
Look for the average retail price of gasoline in the U.S. to advance from $3.35 to over $4.05 per gallon by official start of the U.S. driving season on the U.S. Memorial Day holiday near the end of May if the wholesale price advances by approximately 24.8 per cent, its average gain in the sweet spot during the past 10 periods. Current wholesale price is $2.80 per gallon. A 24.8 per cent gain implies a move to $3.50 per gallon. Add $0.55 per gallon for distribution to reach the $4.05 per gallon retail price. An equivalent change in the price of gasoline in Canada also is anticipated. Assuming no change in the Canadian Dollar relative to the U.S. Dollar, the price of gasoline in the Greater Toronto Area is expected to rise from $1.22 to $1.47 per liter.
On the charts, spot unleaded gasoline prices have moved sideways during the past five months between $2.45 and $2.86 per gallon. Short term momentum indicators currently are overbought and have rolled over. Preferred strategy is to accumulate on weakness during the next three weeks for a seasonal trade expected to last until at least the end of April.
A direct way to invest in through the United States Gasoline Fund, LP (UGA $51.66), an exchange traded note based on gasoline futures and short term notes.
Following is chart showing seasonality in gasoline prices during the past four years.
NY Harbor Blendstock RBOB Futures (RB) Seasonal Chart
Don Vialoux is the author of free daily reports on equity markets, sectors,
commodities and Exchange Traded Funds. . Daily reports are
available at http://www.timingthemarket.ca/. He is also a research analyst for
Horizons Investment Management Inc. All of the views expressed herein are his
personal views although they may be reflected in positions or transactions
in the various client portfolios managed by Horizons Investment Management.
Lou Schizas’ Comments on Suncor
Headline reads, “Suncor energy stock enters period of seasonal strength”. Following is a link to the report:
How To Find Trading Ideas Using StockTwits
Following is a link to the report:
Editor’s Note: Tech Talk publishes comments on Stocktwits each morning approximately when the market opens.
Three top stock picks from Castlemoore’s Robert Sneddon
Following is a link:
FP Trading Desk Headlines
FP Trading Desk headline reads, “Canadian Dollar proving less sensitive to risk”. Following is a link to the report.
http://business.financialpost.com/2012/01/26/canadian-dollar-proving-less-sensitive-to-risk/
FP Trading Desk headline reads, “S&P 500 would be up 9% if it wasn’t for Europe: BMO”. Following is a link to the report:
http://business.financialpost.com/2012/01/26/sp-500-would-be-up-9-if-it-wasnt-for-europe-bmo/
FP Trading Desk headline reads, “Where CIBC sees commodities in 2012 and beyond”. Following is a link to the report:
http://business.financialpost.com/2012/01/26/where-cibc-sees-commodities-in-2012-and-beyond/
Eric Wheatley’ s Weekly Listed Options Column
Hello,
In case anyone would be interested, I am currently writing an options guide for J.C. Hood Investment Counsel Inc. While there are plenty of didactic materials for the options-curious, I’m trying to get away from the dryness with which the subject gets treated elsewhere. Regular readers will correctly infer that that means we will be discussing options in a relatively silly manner with copious references to beer. While some may find such references distasteful and/or unprofessional, the idea is to present a seemingly complex subject in a manner that will be intuitively understood and, mostly, which will be fun to read. I’ve still got a lot of work to do on it, but I wanted to frame this week’s commentary.
Most of the learning resources out there for first-time options users oversimplify the theory and those who read these texts often misunderstand the true goings-on in the options market. One doesn’t need to resort to the traditional and completely inaccurate “hockey sticks” (straight-line graphics which illustrate options payoffs at expiration) in order to convey how options work. My particular dislike of these graphics stems from the reality that there are NO straight lines in options trading and those who believe that there are such linear relationships will probably be thumped by the markets for their naïveté.
Let’s go through a thought experiment. This is to illustrate the niggling little things that risk-aware options traders must always be on the lookout for.
It is often said that “an option is “at-the-money” if the underlying’s price is at or very near the option’s strike price at expiration. If an option is at-the-money at expiration, the option’s holder will let it expire worthless because there is no benefit to striking it”. This sentence is in every options textbook and serves to illustrate that the holder of an option holds the right – and not the obligation – to strike the option if it is in his or her best interest. What I find slightly unnerving is the mention of “at expiration”, as though this is a firm, objective point in time at which an option is either black or white. As everything else in life, nothing is quite so binomial.
Options expire on the Saturday following the last trading day of an option’s life. If an options holder strikes a call, he or she* will get the shares the following week. I hope you understand that on the following Monday, the stock’s price may be quite different from the previous Friday’s close.
(*I understand that many people get irritated by the convoluted “he or she” formulation. I apologize, but I cannot abide by the new convention of using the third person plural to indicate a single person or entity. If you would prefer I wrote “…to illustrate that the holder of an option holds the right – and not the obligation – to strike the option if it is in their best interest”, or indeed “Baltimore’s defense didn’t deserve their fate. Lee Evans sucks”, too bad. I jaywalk, I don’t drive exactly 100 on the highway and I will on occasion enthusiastically scratch an itchy ear canal in high-level meetings with my pinky. I’ve gotta be anal about something).
To illustrate, let’s come up with an example:
Walt owns an ABC January 50 put. Last Friday, the 20th, ABC closed at $50.02. Walt isn’t happy, so he goes to the basement and pours himself a Fuller’s London Porter – a beautifully crafted brown British beer – before going over his accounts. But wait! Five minutes after the close it is reported on BNN that ABC’s lead geologist jumped out of a helicopter to his death over Indonesia. Walt seems to recall something similar happening back when he was still a vigorous young single male just starting out in the professional world, full of as-yet-undashed hopes and dreams. Walt also knows that his put option isn’t yet dead and assumes that there will be some manic activity at the open on Monday. He calls up his brokerage and orders them to strike his put.
The following Monday, ABC opens at $38 and Walt is happy.
The idea here is to point out that there are no straight lines in options trading and that you need to understand how things really work in order to get a better appreciation for these little animals’ behaviour. Looking at hockey sticks will not help you in the real world.
…and for those among you who think that this a completely preposterous scenario that cannot possibly happen in real life, I remember vividly when NT, a full six months after the tech bubble popped, closed at $102.50 on October 24, 2000. After the close, news came out and it opened on the TSX the following morning at $75. If that happened on an expiry Friday, knowing that your option is still alive is probably a good thing.
Happy weekend,
Éric Wheatley, MBA
Options Analyst, J.C. Hood Investment Counsel Inc.
eric@jchood.com
*****************
Little known fact about John Charles Hood #14
Cézanne, John Charles Hood’s beloved golden Lab, can crack open a bottle of imported beer using nothing but her front paws and a plastic cigarette lighter. It’s quite cute and practical if you’ve misplaced the bottle opener.
The World Outlook Financial Conference
Friday, February 10 and Saturday, February 11
Westin Bayshore Hotel, Vancouver, B.C.
Mr. Vialoux is presenting.
Here is the link:
Special Free Services available through www.equityclock.com
Equityclock.com is offering free access to a data base showing seasonal studies on individual stocks and sectors. The data base holds seasonality studies on over 1000 big and moderate cap securities and indices.
To login, simply go to http://www.equityclock.com/charts/
Also, please take advantage of Google ads and other ads available in the data base
Following is an example of EquityClock.com’s seasonality charts:
Ten year Seasonality Chart for iShares on the S&P Technology sector (XLK)
Disclaimer: Comments and opinions offered in this report at www.timingthemarket.ca are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered in this report is believed to be accurate, but is not guaranteed.
Don and Jon Vialoux are research analysts for Horizons Investment Management Inc. All of the views expressed herein are the personal views of the authors and are not necessarily the views of Horizons Investment Management Inc., although any of the recommendations found herein may be reflected in positions or transactions in the various client portfolios managed by Horizons Investment Management Inc
Horizons Seasonal Rotation ETF HAC January 26th 2012
Thackray’s 2012 Investor’s Guide
Thackray’s 2012 Investor’s Guide recently has been released. It can be ordered online from Amazon.ca or Amazon.com at http://www.amazon.ca/gp/product/0978220064/ref=as_li_qf_sp_asin_il_tl?ie=UTF8&tag=timthemar-20&linkCode=as2&camp=15121&creative=330641&creativeASIN=0978220064
It can also be ordered online from Brooke’s website: www.alphamountain.com (book is in stock).
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January 27th, 2012 at 9:44 am
Tony: Thanks for #139 yesterday – read it on my playbook while in TO and it made much more sense to me. Thank you ever so much!
January 27th, 2012 at 9:54 am
Hi Slava. Canaccord boosted its target for CP to $89.
January 27th, 2012 at 10:09 am
Michael:
Hope you are enjoying yourself in Arizona. Before Christmas, you said the market would rally and indeed it did, any thoughts on where its heading next. Seems like the trend is still up but a lot of stocks are O/B. Your opinion is appreciated. Thanks and enjoy the sunshine there we have a bit of snow in Toronto.
January 27th, 2012 at 10:10 am
From Bloomberg:
The last time RSI exceeded 70 while the VIX stayed below 20, 11 months ago, the S&P 500 reached a 32-month high before dropping 6.4 percent over the next month, data compiled by Bloomberg show. The VIX is the benchmark gauge of S&P 500 options prices. “We’re definitely in a rare spot,” Josh Dollinger, Chief quantitative and technical strategist at BTIG in New York, said in a telephone interview. “These are extreme readings. They more often than not prove to be exhaustion tops.”
January 27th, 2012 at 10:16 am
Libby
Thanks for posting #4. Hanging in on to a little bit of bear etf’s and looking for an opportunity to exit HVU… for the near term.
January 27th, 2012 at 10:34 am
Hi kay. Indeed, Santa came to town without fail! Most things are now overbought or close to it. I think that we need to have a healthy (but moderate…5% or so would be my guess) pullback soon, and it looks like it started yesterday. Financials and tech are leading the way down, so most other sectors will soon follow.
And yes, it will be another sunny day in Phoenix. I’ll soak up the sun for you!
January 27th, 2012 at 10:46 am
Tawny,
I posted charts for you re. the VIX but they are in moderation…
BTW, Have you heard from Eve, just wondering if everything is OK with her.
January 27th, 2012 at 10:50 am
Michael: Thanks for your thoughts. Here is what someone hitted at coincidentally in their report today.
“It’s entirely possible a local top was established yesterday. It’s also possible the market moves up and takes out the high like it has many times the last six weeks. After all, yesterday was just a single down day. Big deal. “
January 27th, 2012 at 11:01 am
Hi Michael,
I agree with your take on the markets. If you don’t mind, what is your strategy now, i.e. have you exited positions and waiting to re-enter, or are you buying inverse ETF’s as a trade or a hedge for long positions that your’re holding?
January 27th, 2012 at 11:02 am
Globe Adviser,
Average volumes in both US & Canada markets have been trending downward throughout most of the recovery.US volumes are at their lowest since 1999.This increases volatility.
The increase in Etf’s may be part of the cause because mutual fund managers traded stocks more often.Most people buy and hold Etf’s.
January 27th, 2012 at 11:03 am
HVU
Can’t believe it, bit the bullet, and bought @ 10.75.
b
January 27th, 2012 at 11:10 am
Hi Ron/AB. I have been raising cash and have only been buying stuff more as a swing trade than a longer term hold (just bought some GLW this morn as it looks like it’s bouncing off of support). I wanted to buy some inverse ETFs yesterday, but because Europe closed stronger, I held off. I’ll look at buying a position next week. Coffee time!
January 27th, 2012 at 11:11 am
brian,
what technical perimeters are you using to enter that trade?
January 27th, 2012 at 11:13 am
Ron/AB
#7: Hmm. chart still not going through I guess. Eve is doing ok. Still has symptoms from the virus and she is laying low… but she is defiitely ok.
I have been buying inverse bear ETFs but I am wondering if the market might hold up through the end of month trade, esp. with RRSP season… don’t know if I would have the courage to hold on to losing positions that long – into the first couple of days of feb.. I have been buying into FAZ and HFD – since financials appear to be leading the way down – maybe.
January 27th, 2012 at 11:14 am
#4-Libby
The VIX belongs below 20, that’s normal. Readings in the 40s is absurd volatility, that’s NOT normal…. we’re just getting used to the volatility so when we get back to normal it seems and feels odd…lol
Yes RSI above 70 is overbought, but overbought mode can remain for some time….like when a market is in recovery trying to quickly regain lost ground. We had a major correction in the second half of last year….. we are now recovering.
We have a “Golden Cross” on the DOW which is BULLISH; we are in the process of making the same on the S&P 500…. the TSX is about to break-out above its 200 DMA, which the DOW and S&P 500 already have done… so the TSX is now trailing a bit… when it was leading downward last spring… the charts are now bullish for all major NA markets… we’ve had our major correction, it’s behind us. Trading sideways for a period can also be a correction…doesn’t have to be down it can be in measured time.
Doesn’t mean we won’t pause here or make a small dip… but it will be a buying opportunity. The trend is upward…..The US economy is doing better than people think… look at the automotive sector, it’s the real gauge for this time in the cycle.
Markets climb a wall of worry…..
“Bull markets are born in times of maximum pessimism; grow on skepticism; mature on optimism; and die on euphoria.” (Sir John Templeton)
No optimism or euphoria here… but lots of skepticism. Quite normal for this period in the cycle.
January 27th, 2012 at 11:19 am
Tawney #14
NTR
Thanks for news of Eve; glad she is OK, this bug really takes its toll!
Give her my love, and make sure she knows she is missed!
January 27th, 2012 at 11:26 am
CJ
NTR re #14: Eve will probably read what you wrote here. It seems, she just doesn’t have the energy to do analysis and posting, but I think she is still doing a little reading… I’m sure she will appreciate your message.
January 27th, 2012 at 11:29 am
Canuck 2004
“Doesn’t mean we won’t pause here or make a small dip… but it will be a buying opportunity”
I’m looking to be in for the trade and then I’ll be long until the market tells me otherwise.
“The trend is upward”
Intermediate trend is up….long term from late 2007 is down for the s and p…..trend direction depends on your point of view.
Even so, the trend is your friend but which trend depends on whether you are a day, swing or buy and hold investor.
January 27th, 2012 at 11:32 am
Hi all. Enjoying the coffee in my neighbourhood shop, and got this from David Rosenberg:
• A list of the major themes for 2012:
• Income
• Deflation trumps inflation
• Corporate bonds
• Long-dated govies
• Balance sheet quality
• Gold
• Equity market
• Volatility
January 27th, 2012 at 11:35 am
Canuck
Re your post 15. You are very experienced in the markets and I certainly see reality in what you are saying. IMO, it was my mistake in getting sucked into HVU and I am looking for an exit opportunity in a correction which seems to be due, and hopefully will manifest soon so we can get over it. I then would buy into the pull back in seasonal sectors and ride it for awhile. I do not want to miss out. But I do not want to be heavily invested if and when Europe collapses. Who knows that may not happen until next year. I, for one, certainly appreciate your view point. Personally, once we have another “major” pull back, I will invest in good yield producers, hopefully at bargain prices. Thank you.
January 27th, 2012 at 11:36 am
Hi slava,
your breakeven price of 13.62 on hgu is hit if I am not mistaken. If you remember when you were mad about getting stuck in the trade I told you we were holding world’s best gold companies not hnu.to which won’t come back.well they came back and you should be at breakeven at this time.what you decide now is upto you.i can’t tell you to sell but GDX is at 200ma right now at 57.29 which could be a major resistance but who knows.i have nothing at the moment.
good night
kam
January 27th, 2012 at 11:38 am
Hi all. Yes, I’m on a caffeine high! Fairfax Financial has doubled its RIM holdings to 5.1% of the company.
January 27th, 2012 at 11:40 am
Canuck,
Yes I agree with you that markets generally are in an uptrend. I think a lot of the discussion re the VIX, HVU etc is in expectation of a shallow dip but it may as you say just turn out to be a consolidation before continuing higher. If there is a correction, I also think it will be a buying opportunity. The question is, if one is holding long positions, would you hedge them in expectation of a dip?
January 27th, 2012 at 11:44 am
CJ – HNU is up! Not sure of your B/E price, but you said you wanted to cash out
January 27th, 2012 at 11:51 am
ciovaccocapital.com
S&P Push Toward 1,327/1,340 Reasonable
Friday, January 27th, 2012
In early January we stated it made sense to see how the S&P 500 acted between 1,285 and 1,340 (see 1:47 mark of video). Today we sit at 1,316, which means no resolution has come yet. We will pay attention with an open mind, but it is always good to have a base case laid out for the short-, intermediate-, and long-term. From a short-term perspective:
The last push higher in the S&P 500 looked too strong technically for a typical end of a move, which means it would not be surprising to see another push higher, maybe beginning from 1,316ish to 1,293ish.
If we push higher, resistance may come in near 1,327, 1,330, and then 1,340.
If the move higher is weaker, using indicators such as RSI, it may be followed by more significant downside, possibly below 1,200.
Potential areas of support to watch would include 1,285, 1,275, 1,253, 1,210, and 1,192.
A more immediate bullish scenario may follow breaks of 1,330 and 1,343ish. Numerous markets in the United States are looking tired on monthly charts. Thursday’s high was 1,333; so, exercising some patience if we move as high as 1,343 makes good sense.
January 27th, 2012 at 11:58 am
Anna/TO #24 – B/E > 5.89
Not there yet! I’m on top of it thanks Anna!
January 27th, 2012 at 12:14 pm
Tawny
please remember HVU looses value every day, even if market doesn’t move … also if market moves down in an slow fall with little volatility ….also, if this greece thing settled there maybe, say maybe a bounce higher .. just my opinion, which maybe off target
January 27th, 2012 at 12:17 pm
Today trend, 12:00, TSX, high vol.;
- moving higher ELD, CLS, YRI, RIM, SLW, POT,
- moving lower MFC, BBD.B, FM, CUM.
January 27th, 2012 at 12:21 pm
cj
I think you are going to get your wish….looks like it has been consolidating that last little ramp up.
January 27th, 2012 at 12:23 pm
Anna/TO – What did the “nooner” provide? I think Winter was forecast?
January 27th, 2012 at 12:27 pm
Nick,
Day trading is not my style, however trends do play a part, and when I see everyone honky dory with the present up trend, $100 oil, and major corporations sitting on their cash, high real unemployment, individual states in the US robbing industry from one another (in the form of tax incentatives) and major corporation like CAT paying there US operations starvation wages, I get a little worried!! Globel debt is rising, and most imporantly, there is too much capacity in the world, so where’s the growth going to come from to drive the US market? Consumer is broke, low wages, and the wars are ending!!
January 27th, 2012 at 12:34 pm
Bob re #27
Thank you… yes, and I am watching with worry.
January 27th, 2012 at 12:38 pm
CJ and everyone, actually.
TT dayly report today discussed Gasoline and UGA. I checked it out – last year it gained 33% from Jan 27th to April 29th. Past performance is not…. etc. etc. do your own due dilly.
Wonder how else to play Gasoline Price in Canada… any ideas?
January 27th, 2012 at 12:40 pm
CJ
Rig count for $Nat Gas on Friday.
January 27th, 2012 at 12:40 pm
Hi Ron/AB and others. I think that hedging can be a good strategy, especially when the market is very overbought. The obvious challenge is timing and trying to trade against the trend. While there are good vehicles to play this, I think that cash is the better place for most of the “hedge” because you can’t lose if the uptrend continues.
January 27th, 2012 at 12:42 pm
Minchael: Spelling error post #8, should be :hinted” Sorry.
January 27th, 2012 at 12:44 pm
Kay
Looks like you and I are the only bear holders – so we cozy with teddies!
I am long UGA and Silver, though.
January 27th, 2012 at 12:51 pm
Ana #34 – Rig Count??? too many parameters with this NG LOL in the long run – it’s the price that counts (and the back room boys desires?)
January 27th, 2012 at 12:53 pm
Hi Michael,
Well so far all I have done is raised some cash by selling 1/2 positions to 2/3 positions. I am considering small positions in inverse ETF’s but want to see how the day unfolds, I haven’t bought any yet. Earlier this week I tried to play HVU but got out when it went against me. It was a mistake to use this as a hedge as it doesn’t track well to the $VIX.
NTR, Are you retired in Arizona or a Canadian snowbird maybe?
January 27th, 2012 at 12:54 pm
Tawny: Twice within the past 6 months I have been caught now on the wrong side of trades. DOW down 80 + points FAZ up maybe 20 cents, don’t understand. I am very concerned when Greece announce their agreement with the bond holders next week the markets can rally a lot, HVU and FAZ will be hit badly, also month end rally approaching. This sure doesn’t look good. Wondering if to exit and re-enter when the time is right. Just sit on sidelines. What do you think.
January 27th, 2012 at 12:57 pm
#30
CJ – The 12Z GFS 11-15 report of today printed more cold in the NE and Midwest -> colder weather coming.
Nat gas rig count at 1 or 2pm
January 27th, 2012 at 1:01 pm
Anna/TO – I thought as much when HNU.to and COG both moved up a little after 12; trying to keep track of about 7 stocks, so did not look for the weather map.
What does the rig count signify? This is quite an education in Natty Gas!
January 27th, 2012 at 1:04 pm
#41
Rig count down by 3 (so I’ve heard)
January 27th, 2012 at 1:05 pm
Slava: Will you be trading HGD.to for a swing trade. Gold is suppose to trend down at the end of January I think, not sure about seasonality. Have a great day and happy trading.
January 27th, 2012 at 1:08 pm
Fitch just downgraded 5 Euro countries – including Spain, italy, and Belgium… uh oh, not looking good for Euro land
e.
January 27th, 2012 at 1:08 pm
#42
CJ,
Nat gas rig count lower = less rigs operational = less output = (hopefully) higher prices
That’s only one of the factors affecting prices, if you’d like to find out some more, pls. check out First Enercast forums – lots of good info there
January 27th, 2012 at 1:09 pm
Belgium, Italy and Spain Downgraded by Fitch (CNBC)
January 27th, 2012 at 1:10 pm
#45
Eve, don’t you just love those Friday downgrades!
So far:
Cyprus has been cut from BBB to BBB-
Spain has been cut from AA- to A
Italy has been cut from A+ to A-
Belgium has been cut from AA+ to AA
January 27th, 2012 at 1:11 pm
#48 – cont
Belgium cut from AA+ to AA
Slovenia cut from AA- to A
Cyprus cut from BBB to BBB-
Spain cut from AA- to A
Italy cut from A+ to A-
Belgium cut from AA+ to AA
January 27th, 2012 at 1:11 pm
#20- Tawny
The VIX has made a “Death Cross”, bullish for the markets.
http://stockcharts.com/h-sc/ui?s=$VIX&p=D&b=5&g=0&id=p93260527069
Europe will not collapse… we’ve seen the major correction for now…
January 27th, 2012 at 1:12 pm
# 23 Ron/AB
Nope.
January 27th, 2012 at 1:15 pm
Canadian Pacific (CP) price target raised to C$89 from C$80 at Canaccord
January 27th, 2012 at 1:23 pm
Kay
The Dow and FAZ are down about the same percentage wise – about -.70%
This is a close watch for sure… The Uptrend today said if the VIX goes below 18.39 the markets it is a positive move for stocks – something to that effect. Watch for yourself. VIX is at 18.82 right now.
http://theuptrend.com/Free-Stock-Market-Timing-Newsletter-20120127.htm
HVU as Ron/AB says above, does not6 track the VIX well at least in short term.
It is definitely a watch. Of course the Greek talks could once again not work out.
I can’t tell you what to do, Kay, of course…. but if I act I will let you know.
AT the moment I have gone long HGU so at least I will have something moving up if the markets go up. And UGA can go its own way too.
January 27th, 2012 at 1:25 pm
Canuck 2004
The vix made a golden cross mid august last year and the s and p crashed around the same time…not convinced longer moving averages work on an indicator of volatility that tends to trade in a range.
January 27th, 2012 at 1:27 pm
Tawny/Kay
If you look back to mid october the dow is up as e know and the faz is down huge…not clear on why you associate the two?
January 27th, 2012 at 1:35 pm
Libby
re #55. I don’t necessarily. But, Kay mentioned it and I am not sure what she has on her mind with this…. maybe just lamenting that neither are down much. I will watch the real VIX to see if it gets below $18.39 which could be positive fors tocks.
January 27th, 2012 at 1:40 pm
Re my post #53… I went long UGA not HGU (brain had a muddy cross – definitely not golden) LOL
UGA is up already which is great but I’m not finished buying.
January 27th, 2012 at 1:53 pm
Hi Michael, where did you see an upgrade of CP by Canaccord? I can’t find it. CP is the most overpriced railroad in NA. I’m losing so much money on my short positions – lulu, cp and cmg keep going up. It’s unreal. I know the moment I cover my short positions and take large losses they will turn around and go down.
January 27th, 2012 at 1:58 pm
Weekly options expire TODAY – “they” have been trying to “keep” the SPX to 1315 since last week!! I wrote about this earlier this week and last week too! So, that’s the level it will be kept at all day in order to trash most options today.
eve
January 27th, 2012 at 1:59 pm
kam, I just sold the rest of my hgu at $13.74… my break even is actually higher than $13.60 since I sold some of my position at $13.14 last week. I’m tempted to buy some hgd going into the weekend, not sure. Gold is holding up very well.
Just got another margin call from Itrade. My short positions are not working out.
January 27th, 2012 at 2:00 pm
Hi Slava. I have an account with Canaccord, so I get their morning briefing.
January 27th, 2012 at 2:00 pm
Hi Eve, good to see you back. How have you been?
January 27th, 2012 at 2:02 pm
A debt relief deal for Greece could come this weekend, a senior European Union official said Friday.
and / or
Greece reported to be planning eurozone exit
which will evolve to be truth ????
http://www.cbc.ca/news/business/story/2012/01/27/greece-debt-swap-talks-rehn.html
January 27th, 2012 at 2:04 pm
Eve
Re #59. Thanks for popping in to tell us that. But it doesn’t tell us which way things will go Monday, so PLEASE bring out your crystal ball. LOL
I guess life would be pretty boring if we knew what was going to happen tomorrow.
January 27th, 2012 at 2:10 pm
For you bears out there, the spx has broken it’s uptrend line from the 19th december today.
January 27th, 2012 at 2:15 pm
Hi all. Dennis Gartman says to get long gold:
http://www.cnbc.com/id/46164310
But I find that he’s more wrong than right. I may reduce my exposure in CEF.A.to next week.
January 27th, 2012 at 2:16 pm
Libby or anyone:
Could you please tell me what options are showing for FAZ and HVU. Much appreciate.
Looks like Tony took a day off after yesterday’s high work load here. Hope he doesn’t have the flu.
January 27th, 2012 at 2:20 pm
Sorry Kay…I don’t follow options.
January 27th, 2012 at 2:25 pm
Canuck/Michael/Eve or anyone:
Could you please let me know what options are showing for F and HVU. Thanks a million.
January 27th, 2012 at 2:27 pm
Slava
What about your short on TD, you must be making a killing!
January 27th, 2012 at 2:27 pm
Re: Post 69 should be FAZ
January 27th, 2012 at 2:30 pm
KAY #67 – FAZ – they are selling the calls both Jan & Feb – Bad News stay away! HVU.TO – No options listed on Mtl xch.
January 27th, 2012 at 2:39 pm
http://ciovaccocapital.com/wordpress/index.php/stock-market-us/sp-100-large-caps-fatigued/
S&P 100 Large Caps Fatigued
While it may not morph into anything further, the daily chart of the S&P 100 Index below is limping into the weekend. Numerous indicators show slowing momentum. A close below 595.89 would add to our concerns. The ETF symbol is OEF.
Charts with link.
January 27th, 2012 at 2:40 pm
etf symbol is OEX….their mistake but their charts are right
January 27th, 2012 at 2:44 pm
Slava,
Re post#58
Only a good market correction will bring CP and LLL down significantly in the short term, and for that you may have to wait for several weeks.Markets are not rational these days.Why not buy some calls to limit your upside exposure?
January 27th, 2012 at 2:45 pm
# 55 Libby
Exactly my point, VIX makes a “Golden Cross” and moves higher, then markets crash. VIX is an indicator of volatility. High volatility is NOT normal… VIX at 48 is NOT normal.
VIX now making “Death Cross”…. and moving lower….we should be seeing the opposite of a crash, which is a bullish MELT-UP….
VIX is a “contrarian” indicator, high VIX = bad markets, low VIX = good markets.
VIX is NOT in a trading range…. is now coming off of an extreme high and moving lower. A move from 20 to 48 and back down to 20 again for the VIX is not a trading range….lol…it is an extreme condition normally quite rare…. normal trading range for the VIX is more like 16 to 20 and back again.
January 27th, 2012 at 2:46 pm
CJ: Thanks your the above info.
Tawny: I read the article you posted, my humble opinion I don’t think Greece wants to leave the Euro zone. That being said what catalyst do you think can take the markets down just a bit next week, I would like to leave shortly and was wondering once again if I should sell half my holdings. I think I can get out of FAZ next week easily with a little luck.
January 27th, 2012 at 2:47 pm
Canuck, re #50…the contrarian in me says be very, very carelful with the VIX at under 20. We, as investors are way too complacent.
Here is your VIX chart again using Bollinger Bands. Note VIX is travelling down the bottom band and it broke through recently. There was a “squeeze” a few days ago. A possible upswing exists. RSI is not yet oversold but is nearby.
http://stockcharts.com/h-sc/ui?s=$VIX&p=D&b=5&g=0&id=p57220567041
January 27th, 2012 at 2:48 pm
steve, I just don’t understand how CP can be up after posting disappointing results after a huge run up in it share price and being overbought for such a long time. I think it’s too late to buy calls.
January 27th, 2012 at 2:56 pm
CJ: Making a lot of typing errors today, S/B : Thanks for the above info.
January 27th, 2012 at 2:56 pm
Anyone buying fm.to here at $23.07?
Eve, it’s an interesting sign that even with the Chinese on holidays this week the price of copper actually went up this week.
January 27th, 2012 at 2:56 pm
mick/inv, I covered my TD short two days ago.
January 27th, 2012 at 2:59 pm
kay, I bought hgd at $7.80, not sure if I should keep it. I do own kinross, osisko and some abx so perhaps it’s a good idea to hedge. I’ll see. It looks like gold stocks want to go up in the final hour.
January 27th, 2012 at 3:03 pm
Slava,
If it’s too late to buy calls,you have nothing to worry about.
January 27th, 2012 at 3:05 pm
steve, good one
..lol. I believe markets should be down next week.
January 27th, 2012 at 3:07 pm
mick/inv, how old are you approximately?
P.S. Am I the youngest member of this forum (I’m 34)? I think Kam might be younger.
January 27th, 2012 at 3:09 pm
Slava: I bought a little as well but a bit higher, hope it works out for both of us.
January 27th, 2012 at 3:10 pm
Hmm.. hgd at $7.80 – to keep or not to keep until next week? 6k shares.
January 27th, 2012 at 3:15 pm
Slava
I am 59, I will be retired soon, this year definitely. You are young and successful, I have no doubt that you will retire a millionare!
January 27th, 2012 at 3:16 pm
Kay re #77
Hopefully you are still here? Sorry, I see you posted about 1/2 hour ago… I waqs on lunch, etc. etc.
Th VIX is now trading below 18.39 which according to Uptrend is good for stocks.
I can’t help you make a decision on this but sometimes when I feel uncertain, I sell half… that way I will be half-right and half-wrong regardless of how things turn out.
Let me know your decision.
January 27th, 2012 at 3:24 pm
Tawny: Just talking to myself didn’t mean to put you on the spot for a decision. I notice that as well with the VIX. My concern is if Greece comes to an agreement how much the market will rally. I wish if Eve would post something in addition to what she posted above. The DOW is close to 2007 high, so suddenly all troubles are over.
If the markets are performing so well in bad times, I wonder what it will do in good times.
January 27th, 2012 at 3:26 pm
Hi Slava. You were looking for something to short. Cameco looks like it wants to test $24 again; if so, it might be a good candidate:
http://stockcharts.com/h-sc/ui?s=CCO.TO&p=D&b=5&g=0&id=p08613434665
January 27th, 2012 at 3:40 pm
Hi kay and Tawny. I would imagine that the markets will rally on Monday, at least initially. After the Fitch announcement, stocks started moving up, like they have done after the other downgrades. I guess we’ll see in a few days. I’m off to find a Happy Hour!
January 27th, 2012 at 3:41 pm
#79-Freddebuoy
Look at a longer term chart:
http://www.nasdaq.com/symbol/vix/interactive-chart?charttype=candle
January 27th, 2012 at 3:48 pm
XGD is a bit overbought and seasonality is not that great for gold stocks from late January into February:
http://stockcharts.com/h-sc/ui?s=XGD.TO&p=D&yr=1&mn=0&dy=0&id=p18095110052
January 27th, 2012 at 3:48 pm
check out hlr.un.to
holy cow, it went from 9million to 131million traded within the last 5 min. how much of that is cross trading
January 27th, 2012 at 3:48 pm
Tawny: Sold half of my HVU, if markets changes next week will add to it. Have a great weekend.
January 27th, 2012 at 3:48 pm
Between… please see post #15 which was waiting moderation.
January 27th, 2012 at 3:51 pm
Canuck
“Exactly my point, VIX makes a “Golden Cross” and moves higher, then markets crash. VIX is an indicator of volatility. High volatility is NOT normal… VIX at 48 is NOT normal.”
The vix made a golden cross last year around august, the vix went up, the s and p crashed. So, how does it the vix making a death cross now mean that the s and p is going to melt up. The long range moving averages are not very helpful with the vix as it in theory can only trade between 0 and 100 though it is theoretically impossible for it to reach either. Over the last 3 years it has traded between 15 and 47 and that is the range I am talking about.
The vix, as Freddebuoy also states, is a contrarian indicator so now, at the low end of it’s range it is indicating too much complacency in the markets and that usually leads to a pull back upon which the vix goes up in value. That is the move that Tawny and others, including myself are trying to catch.
January 27th, 2012 at 3:55 pm
mick/inv, thanks for the vote of confidence. I still make a lot of mistakes with investing, look at my short positions.. you, tony, Eve and others told me to be more careful with cmg and lulu, I didn’t listen and now get a weekly margin call. CMG is up today, again!
January 27th, 2012 at 3:59 pm
Anyone shorting HNU over the weekend? It ran up quite a bit today.
January 27th, 2012 at 4:02 pm
kay, I just sold hgd at $7.84.. 6,000 shares. I’ll take $220 and sleep well on the weekend.
January 27th, 2012 at 4:02 pm
Well this will make for a colourful next week….I’m thinking long hanging ropes?
http://www.zerohedge.com/news/silent-anschluss-germany-formally-requests-greece-hand-over-its-fiscal-independence
January 27th, 2012 at 4:05 pm
Slava
CMG is overbought although it is not above the 20,3 keltner. it can still go up another 5 dollars or so. at that time, you might try buying some put options rather than shorting the stock.
Look at the charts and notice difference between when you shorted CMG and TD. You should be shorting when the charts look like TD’s chart. I think you will be find you will be far more successful than now, it is just having the patience to wait .
January 27th, 2012 at 4:12 pm
Libby: Thats a very interesting article…post 103. Greeks will be trading their heritage for cash. However, that article was publish today at 3:39 p.m. and the markets didn’t react.
Slava: Congratulations on your trade, I also got out of some bears, wants to enjoy the weekend. Still holding HGD.
January 27th, 2012 at 4:12 pm
mick/inv, good point and also CMG is a crazy stock with a very low float.. Today’s volume 278,000 shares. They are reporting earnings on Feb. 1st – I’m really concerned – what if they exceed expectations? I’m currently at -$4,300 on this short. Crazy! How did I let it get so huge? Between CMG, lulu and CP shorts I’m down a lot!
P.S. Investorline still hasn’t covered my lulu short.. weird.
January 27th, 2012 at 4:17 pm
mick/inv, with CMG I need to review my strategy. Yes, it can be another Netflix in the making. Taco Bell will begin to directly compete and the price of meat and poultry is expected to go up even more in 2012. CMG can be another Netflix in the making in terms of expectations of growth.. yet, do I just stay with my 200 share short position and keep losing money (on paper) every day as it keeps going up? What if it takes the market 6 months to realize that the stock is severly overpriced? I don’t know if I can handle weekly margin calls.
January 27th, 2012 at 4:36 pm
Slava
Well that might be one of your criteria’s for the future, on the U.S. market don’t short any stock that has volume less that 1M per day, on the Cdn side, less than 500k.
I don’t know what to tell you about CMG , if the earnings are good it will probably jump, but you never know. It is good that you are recognizing that you need to reconsider your strategy. As you said before, you have made a fair bit of money doing what you are currently doing, but you also seem to be taking some big losses. A review does not hurt.
January 27th, 2012 at 4:43 pm
mick/inv, what would have helped today is if I still owned 4,000 of hgu purchased two days ago at $11.63.. was stopped out at $11.69 or smth like that. I could have used that $8,000. Oh well.
Overall my accounts are up this week, which is a good thing.
When gold stocks become crearly overbought I’ll load up on HGD for a hold (with a stop loss). I think hgu/hgd combo can be traded very profitably, I’m surprised that tony, Eve, Lin and others are not taking full advantage of them.
January 27th, 2012 at 4:46 pm
Well Tawny i think You was on the wrong side of the trade with in last six months too if i remember right I think it was Bear etfs like you are now with Hvu ,don,t worry and be happy what goes up comes down very Fast ,it is magic of Gravity every one is bullish now and that is not good sign at all with markets so much over bought ,World is still in same shape and getting worse as it was six months back ,nothing is resolved i will gave hvu A month and watch it how it jumps up.
January 27th, 2012 at 4:47 pm
Libby re #103
Thanks for posting that article… Here is another one from tomorrow at 10:10 am . LOL
Time Zones! So if this news is breaking in Europe now… well, I guess we could see Greek riots again.
January 27th, 2012 at 4:55 pm
Slava
I am not a big fan of etf’s especially these double bull/bear ones but to each his/her own. These are not buy and hold instruments, but certainly can be good for a day/few days trade.
You should never look back at your trades (other than writing down why you bought/sold), you made money, that’s what matters, it could have easily been the reverse.
If your portfolio is up that is good, I also have had a good Jan, but I tend to stay fully invested anyways, just switching between stocks/sectors as they come up.
January 27th, 2012 at 5:04 pm
Posting link that goes with #111.
http://tvnz.co.nz/business-news/germany-pushing-greece-give-up-budget-controls-4704823
January 27th, 2012 at 5:09 pm
Libby,
CNBC just broadcast your info in the link #103. I know the Greeks, they are a very proud civilization, and no way will they go for that. Remember half of Cyprus is controlled and supported by the Greeks. What is Merkel and crowd thinking? Are they forcing that poor nation out of the Euro? Is this there final solution.
b
January 27th, 2012 at 5:14 pm
Kay
That’s because the Greek people haven’t had time to react yet.
January 27th, 2012 at 5:21 pm
Sorry Brian
Didn’t see your post before replying to Kay…I think there will be fireworks this weekend. So, what the Germans didn’t achieve with two world wars will be achieved during peace of it does happen….Greece just being the first.
They proplr will force their exit from the euro I think and default as a result.
January 27th, 2012 at 5:22 pm
Oooooop should read
The people will force their exit from the euro I think and default as a result.
January 27th, 2012 at 5:28 pm
Hi All,
re the SPX:
Ok, now tht ALL the options for January are EXPIRED (as of TODAY for the weeklies), next week, we’ll be able to see the “real” action of what the markets are intending to do! It is “normal”, that in the last few days of a month and the first 5 days or so of the next month, thye markets will be UP days – BUT, remember in 2011 that this did not occur for SEVERAL of the months in the year – INCLUDING the seasonally STRONG period where in March and April, the start of the months was VERY negative – for the first 2 weeks of BOTH months!! See the WEEKLY chart and look at these months last year to see this:
http://stockcharts.com/h-sc/ui?s=$SPX&p=W&b=8&g=0&id=p91238686711
The same occured for the FIRST week of May (the ENTIRE month of May was down), June, and August (August was a nightmare if you all recall – for the longs that is).
So, as we re coming to the final few days of January and the first week of February, with the markets having been up for basically 6 straight weeks AND are overbought AND are losing momentum in buyers AND with Feruary being “generally” not a good month for stocks, then it would not be surprising to see a pullback in the first week of February rather than yet another bull week.
Also, the US dollar is now oversold AND is at a support level of 79. Also, the VIX index today gave a “buy” signal on stochastics – a buy signal is when the moving line moves up through the 20 line on stochastics – that occured just TODAY (stochastics is at 23.72 today). When the VIX has gotten to around 15 in a bull market for stocks, that historically has signalled the time for when the pullback came into play. This week, the VIX got to 16.80 (as of yesterday).
Also, many stocks AND commodies like copper for example, are at the top of the keltner AND are overbought on the keltner, RSI, and stochastics – they won’t just keep moving like this to the moon – even nat gas did its pullback this week and HND went from $31 reached last week, to $20 reached this week – NOTHING goes ONE way forever! Copper has moved up EVERY day (bar 1 day) since January 10th. It is VERY overbought on RSI (at 73.73 as of TODAY – over 70 on the RSI is overbought) – and thus, this level will not be sustainable (check copper on the chart under $copper). When copper pulls back, so will the markets!
Yes this is the bullish period for stocks – BUT, pullbacks ALWAYS occur – NOTHING goes up forever – without having at least a brief pause. Pullbcks are VERY healthy because when they occur, it leaves the door open for those people on the sidelines WANTING to buy but not wanting to buy at the TOP, to buy equities on weakness or at support levels when they think the markets still have room to run!
So, as there is really nothing right now to prevent a pullback from taking place (as in, no manipulation being done to keep the SPX at 1315 for the last 2 weeks for options’ expiration for both weeks), then I can only expect that a pullback will be coming in the imminent future! Expect the SPX to pullback to the keltner bottom OR to the 200 day MA OR to the 50 day MA – and IF that sounds too vague to know where to expect the SPX to pull back to, I did that purposely because ALL 3 of these are VERY close by to EACH other – at the 1250 to 1260 area (keltner bottom at 1261, 50 day at 1255, and the 200 day is at 1257) – ALSO< there is PRICE support too at 1250 for the SPX – so, that seems to be the most likely area for the SPX to pull back to – ESPECIALLY when ALL 3 "indicators" are"basically" AT the same price levels too
Hope this helps guys
Eve
January 27th, 2012 at 5:33 pm
Libby: Re your post #55, your statement re October is correct. However, today we have the opposite situation, DOW down but FAZ was not up. They are suppose to go in opposite direction from my experience. If DOW goes up (FAS) would move up. DOW goes down (FAZ) spikes up.
January 27th, 2012 at 5:45 pm
Hi Ron/AB,
Thank you so much for thinking of me – I really appreciate that
I’m doing ok – just trying to get over this thing I’ve got AND trying to do some trades too – tony has been doing an AWESOME job though!!! So, I hope he keeps it up 
Thanks Ron
Eve
January 27th, 2012 at 5:49 pm
Hi CJ,
Thank you so much!! That is so sweet of you to give that message to me (through Tawny) – it is so nice to know I get the love AND the missing
that is just so sweet CJ – so, thank you thank you for that very very lovely message you sent 
I do appreciate it A LOT!! 
I hope you are doing ok these days with your health CJ – good thing the roads haven`t been too treacherous in January for your drives to Princess Margaret. I hope you`re doing ok though with all that you and your hubby are having to deal with these days – my heart and good wishes go out to you both CJ
eve
January 27th, 2012 at 6:12 pm
Hi Kay,
FAZ isn’t an inverse ETF to the DOW – it’s an inverse ETF to the US financials – and I’m thinking that Goldman sachs is most likely the main holding in FAZ – and Goldman today was up by $3.21. Other US banks were up today too – like Morgan Stanley and Citigroup (plus others I’m sure too as they all tend to move up or down together). So, that is why FAZ today was down and why FAS today was UP. Neither of these 2 ETF’s have anything to do with what the DOW is doing – they are only doing whatever the US financials are doing
hope this helps Kay
eve
January 27th, 2012 at 7:50 pm
To all who needed my knowledge I’m Sorry for not being on the board today,
spent the day with my 5yr old. as we have been neglecting him lately so I took the day off to spend with him as he had the dayoff.
Nice to see Eve on the board.
January 27th, 2012 at 8:00 pm
Now lets talk markets.
I took a peak at the SnP and good news the W%R finally decided to go below the 50% So the train will start its decent to move lower.
the 4Ma has started to curl lower.
MAcd H looks like it has been going down the smaller ema looks like its trending lower but to soon to say for sure on this indicator.
options they have been selling both the calls and the puts so this is not a clear indicator but one thing is for sure if you are selling means you want to take profits now that it’s at its highest in the last few months.
January 27th, 2012 at 8:07 pm
the dow jones has gave the same indication as the snp
nasdaq the W%r has not broken below the 50 but macd ma look as they are moving south
Tsx W%R just below 50 and MAcd Ma has peeked lower than previous its high.
so expecting so downfall on this market coming sooner than we think
cdn financials have already turned south, as mentionned yesterday
January 27th, 2012 at 8:11 pm
Eve: Glad to hear you took sometime from here to take care of yourself and trading. Much appreciate your update on the markets and SPX. I know FAS/FAZ/SKF etc are US financial base, however, most of the time last year whenever the DOW was up or down these would react to the DOW movement. So maybe this correlation is over since Europe seem to be on the mend. So thanks for pointing out that and have a wonderful weekend.
January 27th, 2012 at 8:15 pm
Hi guys,
There are a few other things I can see on the charts too that are “bearish” (potentially). Looking at the weekly charts:
If I look at the energy CDN ETF of XEG:
This has the look of a bear flag (a backwards looking hockey stick) – IF it plays out as per the pattern that is showing, then expect energy stocks to come down – and most likely pull back to the lows reached in Sept/ Oct of between $14 and $15 – this would create a “double bottom” AND be a “W” formation which is BULLISH. So, this would create momentum to push energy stocks forward once this (the bear flag AND “double bottom”) is completed.
the ETF for US banks of ZUB.TO:
This is looking like a similar pattern on the WEEKLY chart of a bear flag forming OR of a cup and handle forming – either way, it means a pullback is coming in the US financials and then a push higher after that – once either there is a double bottom put in OR once the handle portion of the cup is completed.
on the DOW:
On the weekly chart, the DOW is close to hitting the high it hit in May 2011 (at the time the markets pulled back for all of May) AND in August 2011 (at the time the markets did their bigger pullback into the October lows). The DOW is right at that same level now – so, this is where there will be strong resistance AND the DOW is overbought on all measures I look at too of RSI, the keltner, and Stochastics.
the SPX:
on the WEKLY chart: looks like a cup and handle is forming (previously, there was a smaller cup and handle that was forming from August to November – it completed itself in November – a cup and handle is bullish and the SPX went up – just as the pattern suggested – WHEN the pattern gets completed that is – they don’t “always” get completed
) – so, now there is a bigger cup and handle formation that looks to be forming right now – with the cup part being completed and the handle is now coming – the handle is a pulldown of the SPX – once that gets completed, the SPX should move higher from there – as that is what occurs once a cup and handle pattern completes 
Hope this additional info proves helpful
Eve
January 27th, 2012 at 8:17 pm
Slava,
I think you mentionned something about Hf.to yesterday,
there is a consensus among Hfs to trade either Hf or Mgo year after year,
I’ve noticed it about three years ago when I had opportunity of either investing in one or the other I chose back then to trade mgo.to and it moved 7%, that year hf moved +25%, the year after I did the inverse and go figure the exact opposite happened. this year I decided to stay on the sidelines and view who of the two was going to make it, well it seems this was the year of migao. so
so if you want to invest in it I would suggest you either put 50% in each and as soon as you see whos the clear winner this is where you do the switch.
January 27th, 2012 at 8:17 pm
Hi tony,
thanks for that
Glad you were able to spend some time with your little one today
eve
January 27th, 2012 at 8:23 pm
Hi Kay,
Last year was just coincidental with FAZ being up when the DOW was down – this is because in 2011, the MAJORITY of ALL stocks moved with each other – so, if the DOW was down, then MOST all (or many times, it was ALL of them) of the DOW stocks were down (the correlation was over 80% of the stocks moving together – for ALL indexes – the DOW, the SPX, the TSX, the Nasdaq, etc.). This year, stocks seem not to be ALL correlated with each other – they are moving on their own merit this year. So, today, the financials were UP even though the DOW was DOWN – so, one cannot look to buy FAZ or FAS to judge them in relation to what the DOW is doing – they MUST ONLY be judged by way of what the US financials are doing.
If you’d like to buy an ETF that goes UP when the DOW goes down, there are several out there – one is SDOW – I don’t know what the names are of the others – but I do know that CJ has them recorded in her notes – so, please ask CJ for that info (if you’re interested in it I mean Kay
).
Eve
January 27th, 2012 at 8:25 pm
Eve
Thanks for posting all this wonderful information – haven’t read everything yet, but I will… you have mail, my dear.
January 27th, 2012 at 8:25 pm
I will add this to what Eve just said.
XEG on daily chart, macd H is trending lower, and as price is higher the MA on the macd have peeked lower this is usually sign that we are going down.
ZUB on the daily macd MA is trending lower, Volume spiked a few days ago,
and a 4/9 baby bear in the making this is another sign it going lower.
January 27th, 2012 at 8:30 pm
Eve
in todays modern day and age is not like when I was young where my mom was home so we headed strait home. now these kids spend most of their days in the care of someone else
so we have to take every opportunity we have to spend time with them.
January 27th, 2012 at 8:31 pm
i<m getting jealous here where I don't get that much mail from the board.
January 27th, 2012 at 8:31 pm
i<m getting jealous here where I don't get that much mail from the board.
January 27th, 2012 at 8:43 pm
Tony: Always nice to see especially fathers spending time with their kids. With all the material things kids receive nothing can compare to the time parents spend with their kids. As you mentioned it was comforting to know your mom was there 24/7 when you were growing up. Hopefully you had a wonderful day. Thanks for above post we missed you on board today but never mind us, we are cry babies.
January 27th, 2012 at 9:10 pm
EVE,,,, You are the best to explain every thing as every one is looking very bullish ,You are the one who opens their eyes before they are too late to react as big money is already getting out ,i expect big pull back in next coming coming .Greece will be kicked out soon and the Portuguese will be next,and then comes Italy and Spain.S&P will be around 1040 in Feb. March.
January 27th, 2012 at 10:42 pm
# 100-Libby
If you just started looking at the VIX 3 years ago, you would certainly think that 48 is normal… look at it over 5 years, you’ll see it is quite abnormal.
VIX at 15 to 48 is not a trading range… 48 is an EXTREME abnormal condition rarely seen before 2008. It is a spike.
A reading of 48 is absurd volatility…a massive negative spike demonstrating total FEAR and PANIC in the market….(buying OP for me…lol)… 15 to 20 is a range and reflecting a more normal trading market, complacent perhaps, but not a signal of a market crash.
VIX : “Often referred to as the fear index or the fear gauge, it represents one measure of the market’s expectation of stock market volatility over the next 30 day period.”
I don’t expect the markets to make a big tear upward… I expect the same steady climbing a wall of worry on built skepticism….it may even trade sideways for a while… but the trend is UP.
I don’t worry about the VIX and I don’t see another spike up to 48… not in the next few months anyway… it’s just another indicator. All I’m looking at is the normal Fall trade into the Spring. Then I’ll see… not looking further.
I was 100% in cash in my margin account as soon as the TSX was making a “Death Cross” in 2011 and lost nothing. I pulled 20% of my gross out of that account and spent it on various things. I had a nice summer away from the markets….
I got back into the market in Oct after the lows… and have made 20% gross since in my margin account doing nothing really… mostly “buy and hold” so far…not taking profits yet, too soon.
I don’t have to “day trade” to make money….I am way too lazy for that…sounds too much like work to me…lol…. I don’t have to do anything at all with this one and have no stops. It just takes care of itself.
As my old broker at Wood Gundy used to say to me 30 years ago: “don’t try to get too cute with the market, it’ll cost you” and “the best market move in the year is made during about 10 days… rest of the time it trades sideways… you just have to be there to catch it”.
January 27th, 2012 at 10:47 pm
VIX: “Hence high VIX readings mean investors see significant risk that the market will move sharply, whether downward or upward. The highest VIX readings occur when investors anticipate that huge moves in either direction are likely. Only when investors perceive neither significant downside risk nor significant upside potential will the VIX be low.”
Wikipedia
January 28th, 2012 at 12:03 am
Analysts at Barclays Capital (NYSE: BCS) decreased their price target on shares of Potash Corp (NYSE: POT) from $69.00 to $66.00 in a research report issued to clients and investors on Friday. They currently have an “overweight” rating on the company’s shares.
Separately, analysts at UBS AG (NYSE: UBS) cut their EPS estimates on shares of Potash Corp in a research note on Friday. They now have a “buy” rating and a $60.00 price target on the stock. Analysts at BMO Capital Markets cut their price target on shares of Potash Corp from $61.00 to $59.00 in a research note to investors on Friday. They now have an “outperform” rating on the stock. Also, analysts at National Bank upgraded shares of Potash Corp to a “sector perform” rating in a research note to investors on Friday.
http://localizedusa.com/2012/01/27/potash-corp-pot-share-price-target-lowered-to-66-00-by-barclays-capital-bcs-analysts/
January 28th, 2012 at 12:21 am
wlm
I love when they come out and cut price as bmo just did, i think that Red from the 70 show has a saying you dumb ass.
add to it that price is increasing this just goes to show you how banks try to scare novice investors. If the earnings were so bad it would have not moved up by 3%
January 28th, 2012 at 10:50 am
Eve,
Good Saturday morning. Just want you to know that you have mail.
January 28th, 2012 at 11:01 am
To Don Vialoux, Eve, Tony and the other opinions, I found;
“The enthusiastic buying in January has the market again spiked up into a potential short-term overbought condition above 50-day moving averages, to a degree that often brings a decline back down at least to the m.a. That would be a decline of 5 or 6% – if it halted at the moving average.
Then there is the history of February often being a negative month.
My intermediate-term technical indicators remain on their October buy signal, and the market’s favorable seasonality does not usually end until April or May.
But the high level of investor bullishness, and short-term overbought technical condition, indicate it may be time to temporarily take some profits from the rally.”
From;
http://www.streetsmartreport.com/comm3
January 28th, 2012 at 11:33 am
wlm
don’t worry I already took my financials off the table.
I’m waiting for a clear indication from one of my indicators to tell me its time to sell the other securities I have.
January 28th, 2012 at 12:01 pm
WLM
Thanks for posting #143 and link. I don’t recall seeing you on this blog until the last couple of days… but my memory needs new RAM, so cannot be sure. LOL
Anyway, welcome if you are new and nice to see you the last couple of days.
January 28th, 2012 at 3:37 pm
Hi WLM,
thank you so much for that article!! it goes very nicely with my posts yesterday of what i am seeing right now too for the markets
i love getting confirmation of what i see, from the professional guys out there 
so, thank you for posting this WLM 
Eve
January 28th, 2012 at 4:27 pm
Hi Tony,
Thanks for the explanation on options on Thurs ( I get chance today to post). I will keep on looking at diff stocks & if get confused will ask you again. As per red/green I went to CBOE, Delayed quotes but still could not figure out. will try again.
Eve,
Nice to see you feeling better & for your comments. I would appriciate your gold outlook as my friend slava is contemplating of trading hgu/hgd ( I do not touch these).ie if you r feeling better
Tawny
I think I am playing UGA thru HAC ( the lazy way) LOL
Thanks to everybodys opinion esp TT, Canuck2004,wlm & others whom I missed
January 28th, 2012 at 5:17 pm
Probably ….gold and gold stock…see chart..
By Jan 26,2012 3:10 PM and Forexpros; “Futures were likely to find support at USD 1,649.25 a troy ounce, Wednesday’s low and short-term resistance at USD 1,760.35, the high from December 8.”
If $USD next week will trade below 50 MA, we should expect the bullish environment for gold and silver.
See old chart prepared by Ron/BC;
http://stockcharts.com/h-sc/ui?s=$GOLD&p=D&yr=1&mn=0&dy=0&id=p18493339434&a=240672733
January 28th, 2012 at 6:27 pm
Muntazir/Tony #147
The column headed “net” on the Call side – if that is RED – walk away
That is on CBOE…………..however Tony – my question is – on the MTL exchange is the figure called “net change” at the top the same thing? If that is negative, does it mean anything? If not how do we know if Calls are being Sold or Puts bought?
In my Q-trade I can also see options: columns are – Bid/Ask/Last/Change/Volume/Interest. I am looking at TD.TO there and the “change” column is all in red – is this significant???
Thanks – NTR just back from Pearson in blizzard conditions after seeing the kids off;
a little weepy tonight. Earlier we all celebrated Chinese New Year with Dim Sum, Dragon Dances and all!!
January 29th, 2012 at 6:52 am
CJ Muntazir
Net change or net is the same thing it means the same thing.
if the net is negative it means they are selling that strike price call so they are willing to let it run beyond this price but they think this will be resistante.
td being red is it on the calls side?
if you have volume close strike prices in a range for 78,79,80 and then at 81 is 0 and 82 has volume again 81 could be a resistance level so I would have trailing stop at 80 so if it decides to move higher you can profit from it
just as it happened to google back in december when i told rachel to keep a trailing stop below 630 and it went on to trade above 650 before it came back to reality.
January 29th, 2012 at 7:50 am
CJ
change or net is the same thing.
January 29th, 2012 at 10:30 am
cj
in post 150
but in case after 80 there is no more volume this would mean that 80 would be where youll find resistance. if on the other hand there is no volume at 81 and then you have some volume beyound 81 then as it occured with google there could be a push but I recommend to have a trailing stop just in case it decides to move beyound 81
January 29th, 2012 at 11:17 am
Hi all,
Just thought i’d share this important info about the markets – it’s from a free newsletter i get every weekend – on the markets and on stocks. Go down below the videos to get to “SUMMARY” – read from there. Afterwards, you can watch the videos if you’re interested. Here’s the link:
http://www.investmenthouse.com/weekendmarketsummary.htm
Eve
January 29th, 2012 at 11:36 am
Canuck 2004
Re “If you just started looking at the VIX 3 years ago, you would certainly think that 48 is normal… look at it over 5 years, you’ll see it is quite abnormal.”
This is surely because the past 3 years have not been “normal” times. Do you really think things are back to normal? I don’t…. we may have some good markets ahead of us but the future is grim.
I have just started reading “After Shock – the second edition” (Wiedemer) and I urge you and everyone to do the same. In fact, I implore you to read it. They have been “right on the money” in the past with the book “America’s Bubble Economy” which foretold 2008, and this new book should not be igored. Ray-Kitchener talked about this book in the past, which brought my attention to it. He said “every investor should read it.” I just got mine for around $20. from Amazon.ca.
Frankly I am concerned with my current posiition in HVU as I bought it too soon and mistakes are made by everyone. Sooner than later we will see another huge spike in the VIX.
BTW the market volumes are still very low and there is a lot of money on the sidelines… right?
Anyway, Canuck, please read the book and if these bubbles burst as the writers say they will, you will be glad of the knowledge.
Canuck, I know you have been in the markets for a long time and know them very well. The global crisis we are encountering has not occurred in our life-time.. things do not necessarily remain the same.
January 29th, 2012 at 11:42 am
Eve
It must have taken a long time for my message #154, because your message has come in since I started it. Wow, e-mail just popped in from you as I am writing and I will mail you back again before the day is out. I have been reading so much since I woke this morning, including info from you – so much to read, so little time! Must go have breakfast or should I say Brunch.
January 29th, 2012 at 1:57 pm
This is what caught “between a rock and a hard place” looks like: News Germany/Greece
http://www.ft.com/intl/cms/s/0/c4df2a3e-4a9d-11e1-a11e-00144feabdc0.html#axzz1ksJ0BR00
January 29th, 2012 at 1:59 pm
Some comments on volatility & the VIX at ~~ 10:20 into the video to 13:40.
On balance, it seems that he expects the VIX to continue its current trend.
http://www.justin.tv/steveplace/b/306822938
The rest of the video is comprehensive, but rather long,
on general mkts(risk on),and individual names.
Gold & silver comments @ ~~ 18:35.
January 29th, 2012 at 2:54 pm
“It’s Official: German Economy Minister Demands Surrender Of Greek Budget Policy, Says It Is First Of Many Such Sovereign “Requests” Jan 29.”
http://www.zerohedge.com/news/its-official-german-economy-minister-demands-surrender-greek-budget-policy-says-it-first-many-s
“Cost Of Second Greek Bailout Raised To €145 Billion
Which means one thing only: the great propaganda spin machine is now on, and its only purpose is to provide Germany a buffer of “having done everything in its power” to prevent the now inevitable Greek default. Which, incidentally, means that a Greek default is inevitable. Because at this point once the default floodgates open, the question will be not where the bonds will trade, but just how big the impairment on the European DIP (aka Troika bailout package) will be.”
January 29th, 2012 at 2:56 pm
Re #158 here is Link for part 2 “Cost of …
http://www.zerohedge.com/news/cost-second-greek-bailout-raised-%E2%82%AC145-billion
January 29th, 2012 at 3:02 pm
Papademos Gets Domestic Support on Greek Debt, Troika Talks
January 29, 2012, 12:02 PM EST
http://www.businessweek.com/news/2012-01-29/papademos-gets-domestic-support-on-greek-debt-troika-talks.html
So, will Greece give in to the demands to surrender control of budget control… stay tuned….
Meanwhile, more uncertainty.
January 29th, 2012 at 4:26 pm
Tawny: Thanks for the above links, you are sure putting in a lot of work. Will see how futures trade in a couple of hours. Keep up the good work and thanks.
January 29th, 2012 at 4:50 pm
Hvu.to support at 7-8 dollars using volume by price on daily chart. Drawing trendlines helps. Draw a trend line under price action on SPY, as our former leader once said, follow the train tracks “the trend”, which is higher, and going up.
RSI 21 trend change for all markets in october to bullish. Copper trendline is bullish, above 200 ema, bumping on 250 ma. FCX, TCK, and FM.to confirm trend is higher. Oil in a consolidation pattern, heading higher. Gold broke downtrend, going higher. UUP just broke 200 ema, october bearish rising wedge or triangle fufilled, support is a lot lower ( draw trendlines above and below price on uup to see bearish rising wedge). So usd lower, Copper higher, spy in a uptrend, oil and gold uptrend.
Why? Technical analysis doesn’t care why, made up stories, it just is
January 29th, 2012 at 6:09 pm
Definitely NTR
Pretty little “un-valentine” Valentine song – be warm & fuzzy & feel good,
great for any time of the year
http://www.youtube.com/watch?v=65AuuFpNFxY
January 29th, 2012 at 6:41 pm
TONY #
“if the net is negative it means they are selling that strike price call so they are willing to let it run beyond this price but they think this will be resistante.”
Sorry, that is not clear to me regarding the Montreal Xchange:
Please actually look at TD.to options; at the top of the page before the calls & puts are listed, it reads:
Last Price: 77.150 Net Change: -0.710 Bid Price: 77.150 Ask Price: 77.250 30-Day Historical Volatility: 12.54%
It is this net change that is in red; and it is NOT related to any Call or Put option price; but it does read net change and it is red because negative. I believe it is just the change between Fridays and Thursdays closing prices??? So my question remains on the $CDN side how can you tell if calls are being sold or Puts bought?
Now in QTrade’s options for TD we have negatives under “change” for every Strike price from $56 to $82!!!
Please see snip here:
https://docs.google.com/document/pub?id=1Gcbb0nG0o2vE9XCyn8e2RjglXB-ZZR8Hq-X0Txw4pOs
Tomorrow I will be away after 10:30 am and will not be able to monitor much so may have to put in a limit sale offer for some that are in the green or close, like EDR.TO; HNU.TD; AMZN. I need to reduce the number of holdings as I enter my busy season, clients have already started to bring work in, so I cannot give undivided attention to stocks all day anymore….. Guess that will mean swallowing some more losses or letting things like TD and Potash ride along in the red.
Still I would like to be certain I understand about the red & green in other places beside CBOE. Thanks again Tony!
January 29th, 2012 at 9:02 pm
Josh re #162
You certainly do know your technicals – good for you and thanks for sharing.
No doubt you are right about the current picture. Quite a few of the newsletters I read from the gurus (?) is that there is uncertainty whether the trend will continue straight up or have a (probably) mild correction. For example see Eve’s link in #153. No one is saying for sure though I have read more than one saying some money should be taken off the table….. but you seem to be sure the trend is continuing without a break?
As for HVU, I am also very skeptical that it will go up much at this time.. what happens, happens.
January 29th, 2012 at 9:07 pm
Kay
Yes, I have spent considerable time researching and reading news out of Europe. I thik Macro economics are crutial at this time and will dictate direction of the market.
The futures are down, but anything can happen by morning. Especially with Europe & Iran being tomorrow, today! LOL News can come out early morning.
January 29th, 2012 at 9:31 pm
Hi Tawny,
the stochastics on the SPX is about to go through the 80 line on the downside – THAT is a SELL signal!
NOTHING EVER goes straight up without a break – NOTHING!! The VIX has already started to go up (as of Thursday last week) AND gave a BUY signal on stochastics – THAT is bullish for the VIX which means BEARISH for stocks (and bullish for HVU).
There is a rising wedge pattern on the SPX – that is BEARISH – just as josh in his post spoke of a “rising bearish wedge” on the US dollar that was present as the dollar was rising (the wedge goes from beginning of Oct 2011 to Jan 17th this month) – and you see what took place AFTER the COMPLETION of this rising wedge pattern – it got FULFILLED as the US dollar has been coming down from the break of the wedge, ever since the high hit around Jan 17th. Here’s the chart for it:
http://stockcharts.com/h-sc/ui?s=$USD&p=D&b=7&g=0&id=p43092152226
Similarly, there is a rising wedge formation on the SPX (and on many stocks too) – I wrote about this last week on here – again, that is a “bearish” pattern- and if fulfilled, the SPX will do just what the US dollar did when it had its rising wedge pattern realized – it will DROP! I will include the chart of the SPX in a separate post so that you (and others) can see the pattern of the rising wedge that has taken place from around Oct 29th to last thursday. It is the SAME pattern as the YS dollar had – until the US dollar broken to the DOWNSIDE – as a rising wedge signals should be the end result IF the pattern is realized!
I have no doubt whatsoever that the pattern will be realized for the SPX as well as so many indicators are pointing this way – indicators like the bullish sentiment readings for the SPX, the VIX being under 20, the SPX being at a price resistance, the RSI and stochastics and the keltner all showing the SPX is overbought, the percentage of stocks trading above the 50 day MA being at a level that normally signals a decline in the markets is imminent (it’s at 87% – and anything over 80% is a signal that a decline will be coming REALLY SOON – anything 20% or under signals that a bottom for the markets is coming REALLY SOON).
Asian markets are currently down between 1 to 1.5% – plus as you wrote, the Euro markets (futures) and US markets (futures) are all down (by .5% right now).
The decline is right around the corner Tawny – these markets aren’t heading up up and up – without having a pullback first – a pullback to support of the 50 day, the 200 day, AND the bottom keltner, would be VERY healthy (and NEEDED) for these markets – and this means, the SPX pulling back to a price of around 1250 to 1260 area (in the near term).
Hope this helps Tawny
Eve
January 29th, 2012 at 9:33 pm
Hi Tawny,
here’s the SPX chart – notice the SAME rising wedge pattern on THIS chart as can be seen on the US dollar chart too:
http://stockcharts.com/h-sc/ui?s=$SPX&p=D&b=7&g=0&id=p82780756543
Notice too that stochastics is rolling over AND is just about to go through the 80 line (to the downside) which is a “SELL” signal.
Sending thru 1 other chart in my next post…
Eve
January 29th, 2012 at 9:37 pm
Hi Tawny,
here is the chart showing the percentage of stocks on the SPX that are above their 50 day MA – look in the last several months to see how high this indicator got to before the SPX did a pullback (94 in Oct., 89 at the beginning of Nov, 82 at the beginning of Dec., and now we’re at 87 – the markets are going to come down Tawny – MANY signals are telling us just that – including the Asian markets CURRENTLY being DOWN right now by a great amount – ie. by at lest 1% currently – sure, things can change overnight – BUT it doesn’t mean the markets aren’t going to be coming down VERY VERY SOON – regardless if things change overnight TONIGHT or not!).
Hope this helps Tawny
Eve
January 29th, 2012 at 10:58 pm
Oh boy – what a statement :
“Bloomberg TV has compiled the best video summary of the highly irrelevant soundbites by economists, CEOs and other people of transitory power, who provide absolutely no original insight into anything, and in which ironically it is Mexico’s Felipe Calderon who summarizes it best:
“we have a timebomb the bomb is in Europe and we are working together to deactivate it before it explodes over all of us.”
http://www.zerohedge.com/news/davos-post-mortem
January 29th, 2012 at 11:09 pm
Eve
Just came to check on news and posted #170… saw your posts… thank you so much.
I am totally beat now and off to bed.
I will look at them again in the morning when I am more alert.
Given my post #170 – if that statement by Calderon is blown up by the press, as well as other NOT GOOD news out of Davos, I would not be surprised to see the SPX drop and the US Dollar to rise!
BTW, you have mail this aft. Night all.
January 29th, 2012 at 11:29 pm
“The markets are really trying to figure out if they can rally from here.
So far, Gold can. The Banking index is riding on the 200 dma literally.
Check out the US banks at $BKX. While the TSX was 80 points higher, our
Canadian Bank stocks left the North side of the 200 dma and plummeted.
The Energy stocks had a good week, gapping up on Monday. But they bounced
down from the 200 dma. Seems for every positive there is a bear position.
Maybe this is sector rotation….live! Out of banks…into Gold.”
Greg Schnell, CMT – The Canadian Technician
http://blogs.stockcharts.com/canada/2012/01/waveswhat-happened.html
January 30th, 2012 at 12:12 am
Tony & Everyone,
What’s your opinion on European banks?
For example, BCS and DB.
I see a GAP UP earlier this month for BCS.
It should come down and fill the gap at some point, correct?
January 30th, 2012 at 1:18 am
China now down 2%… Europe and Us futures still only down .5%
eve
January 30th, 2012 at 1:22 am
Copper now down 7 cents – see?? they don’t like buying copper at a high over in China when they can buy it instead at a lower level of around $3.25 to $3.50. Copper rose 20 cents this past week while China was off for the week – so, there was no chance that they would be buying copper this week once they got back to work. They always prefer to buy at cheaper prices – and there’s good support between $3.50 and $3.55 area – so, that might be where copper heads down to.
eve
January 30th, 2012 at 7:38 pm
Eve: I really appreciate your posts. I read every one with interest. Please keep it up. THANKS!