Thursday, December 31, 2009

Issue Advance : Volume Advance

woah, put your eye protection on. This one is wound up

Climbing the wall: GOOG

Tuesday, December 29, 2009

Preparing for the Tax avoidance Trade (ie the early Jan sell off)

There is no santa rally
There is no extra juice on the "end of year window dressing"

You want to know why the SPY has been up 27 of the past 29 Decembers in which the spy was up for that given year???  TAXES.  B/C people prefer to avoid them for 12 months and roll them over whenever possible. (they dont sell in Dec, unless they HAVE TO....its human nature to avoid giving money away till when you have too, especially if there is no interest on it).  Also pull up the chart and see how many of those 27 years we had a bullish START to Jan (its less than half, with an even stronger trend in the last few years, why??? my theory again, more people trade their own ports now than ever before. And i expect in its alot more than even last year, right Bernie)

I am ready..........for the New Year correction...I expect the first 1-2 weeks of Jan to be bearish.

finger on some SRS 7 calls......(plan to purchase at the very END of this trading week)

The fact is many more people trade their own account now, than they ever did before.
(and rightfully so Bernie...)

If Joe 6 pack is up big in 2009, (which he is) do you think he really wants to pay taxes on all of it right now? you think he prefers to DELAY that nuissance by 12 months by simply waiting till AFTER the new years to sell a few shares.   I strongly guess the later.

Wednesday, December 16, 2009

USD trend change: When will it start dragging down the market?

$USD looks to be headed UP for the next many MONTHS (6-12 months is my time target for the trend), as I mentioned last week. Observe a weekly chart.

USD weekly breakout 11 Dec 09

But unless one is a currency trader, as HUGE as a key the USD is, it's not everything....
The USD is well off its 74.23 bottom, yet the market is still at it's highs. I also mentioned 2 weeks ago, that I suspect a rising USD will NOT put a damper on the stock market for the next couple weeks, due to it rolling into the Holiday anemic volume season here.

USD watch 6 Dec 09

I stick by my calls, that the dollar is headed up for the next several months, as well as the stock market will not sell off bigtime till 4 Jan 2009.

 - In regards to the USD, I mean the rubber band for now has popped. What more do they expect out of FOMC to get another dollar drop? These FOMC meetings, they have been telling us what they plan to do BEFORE the meetings. The meeting results are no "surprises" really here. They say 0 rate is the plan, and its working for now, etc etc. 

My point is, Tonight's futures, the USD is on rocking tonight, up .43 as a i type this. So the reaction from FOMC is dollar goes UP. Now, what else COULD they of really said, that would of made it dollar bearish today?  Short of "we will never ever ever increase rates, for 500 years!"...short of something "made up" like that, it just seems fully baked in here. Again, imo the 74.23 was a USD BOTTOM, for the next likely year ahead.

Yet i don't think the market "cracks" tommorow, even if the USD picks up more momentum tonight. Its expo week, then the next 2 weeks are lower volume, due to holidays, etc.

-Much more people today are managing and trading their own accounts than just a few years ago. It is my opinion of that. (no studies performed). It's also my opinion, and speculation that after the brutal 2008, the investors that manage their own accounts, and after having a great + year in 2009 they will choose to DELAY paying any income tax by 365 days, by simply waiting till after 1 jan to sell any stocks that were profitable in 2009. 

-That's my theory of why historically DEC is the most bullish month there is. No one wants to sell and pay tax, if they delay it by 12 months (up years, retail pulls the train).   Then in the down years, when some people might want to sell in dec, to get capital loss and get tax benefit like 2008, the fed steps in, and since its holiday volume it's easier for them. (down years, the ppt pulls the train).  Take alook at the dollar chart in Dec 2008. It's surprising the market was not up 15% for the month with that!!!!! So that's just why I think Dec are so historically bullish, fwiw.

The market does feel very heavy, likes its about to puke it up, it does, anyone can see/feel that. I agree 100% with the "Bernake: time magazine" indicator.  Good quick read here, how TIME magazine has been the best contrarian market signal for a little while now.

Man of the year: Time magazine = Kiss of Death

I stick to my thesis, that holidays=anemic volume
anemic volume=more bullish friendly.

If they keep this act up, (which i hope they do)...will be looking to get short heavy right at the close on 1 Jan 09
(friday's are also bullish freindly, and last year, i recall 1 Jan was a big up day, i just recall Dennis Kneale saying he would "dance a jig, if we broke 9000 or something", and every was talking about the great year ahead.  Remember last time, that the financials and reits were the 2 sectors that had HUGE spikes before the p3 crash.

disclosure: long exm, into years end, with finger on abort/sell button

Sunday, December 13, 2009

Looking at the REITS

                      via SPY, IYR, and the 4 highest % reit stocks of the IYR etf

Thoughts:   SPG looks way ahead of itself in relation it's sector
                     (not saying it has already topped here).
                        - does that mean it is a leading indicator
                           and the rest will follow?
                        - it is just far ahead of itself, and more likely
                           to come down harder than others at the next
   (I think the later, as it also dropped the most in 08-early09,
    meaning its the higher beta. Trying put more emphasis on IYR
    to watch, than 1 individual stock)

   IYR looks like it may want to tag 48.57 (61.8% fib)

Saturday, December 12, 2009

Dollar Weekly (update: breakout confirmed)

Well, There she goes. Looks like time to buy the dips now
(dollar dips that is)

It broke out clean, on the WEEKLY as of Friday (intermediate term direction now appears UP)

Personally, I am looking for a pullback on the daily chart (short term), to enter some inverse dollar swing trades.
  - even the weekly chart now can pull back some and still land above prior resistance as new found support.

Not thinking to attempting to pinpoint estimate/guess the height or length of this move, however looking at the USD weekly chart and its past trends and durations for the past 20 years. (39mo, 36 mo, 18mo, 14mo)

Even the monthly chart is bouncing where the support level is.
From a technical perspective, the USD looks as 74.23 was a solid intermediate bottom, and the trend is now up till the chart says it's not. (for the next 6-12 months)

disclosure: long exm into years end

Thursday, December 10, 2009

GOOG (patience)...............

not yet....................................................
but its getting very close, so I mention the set up again, which is......

Waiting for the weekly rsi / macd trend breakdown for short signal.

Update from my original post (above)

disclosure: long exm

Sunday, December 6, 2009

Watch that Dollar (weekly)

Remember a weekly chart ALWAYS trumps a daily.

Friday's usd move was a monster
- the daily chart looks like a breakout
- however the weekly is right at major resistance now

I would like to see it pull back and consolidate, to then look to go short names like FCX
(which trade almost totally inverse to the dollar)

I still believe that in Dec the market will "float" higher due to the anemic volume.
stocks like goog, amzn, aapl with less correlation to the dollar to lead the way. Even though the dollar was strong Friday, the market however was up. With the NASDAQ leading the way. (makes sense, again as it is the lowest USD correlation, yet commodity stocks, such as FCX were hammered)

Bottom line: I am watching the USD weekly chart to break out of its rsi channel before a trend change to be confirmed.

- also, with the low holiday volume, I would not be surprised to see stocks stay afloat and strong even WITH a confirmed USD reversal.
- If so, will wait to after the USD weekly breakout AND after Jan 1st to short this casino.
Disclosure: 100% cash

Wednesday, December 2, 2009

Follow the Leader, wait who is the leader?

............your guess is as good as mine which that is......

sometimes I do have a pretty good track on who is running in front.

So the dow continues to have the lead torch, till it doesn't. However, the amount of time between tops and the expanding differance in the tops has grown fairly larger (ie look at the RUT!). So if i was to lean bullish, i would lean more on the RUT if i did. The divergance is pretty large now, and its chart pattern is actually set up much better than lets say the TRAN (which is in pure wait and see mode for breakout or triple top)
...but that's IF i was trading it long, which im not.

but here now, it looks dark as mud
market just looks undecisive here.....short term.

I still favor the bulls until the 2009 clock is ticking, per my below posts rationale...
.....not trading w/ em though....

random: Windows 7 is a step up and them some from the that vista