Friday, June 10, 2011
FAS profit taking
It looks like FAS is seeing some profit taking into the close. No doubt day traders jumped all over the move and this is about the time of day they start unwinding positions to go flat.
As For Monday
Historically Monday's have produced the highest gains of any day of the week. That's not a reason to buy or hold, it's just part of the information we gather to make decisions.
Today it looks like have a chance to post higher volume in a couple of the averages. As for price volume relationships, which I can only bring you after I update after the close, Price Down and Volume up (if the relationship is dominant) is often a short term bottom on capitulation. Even better would be Close Up/ Volume Up. The average itself doesn't need to post that, but a majority of the components do need to have a dominant P/V relationship. That also would be bullish for Monday.
If the BASEL rumor is not refuted, banks should continue to rally although lowering the rate from 3% to 2 or 2,5% as reported would put the banks in a very serious situation if we enter another 2008 scenario which is very possible. Why the Fed would be doing this is beyond me. Apparently Jamie Dimon from JPM had a lot to say to Bernanke about hiking the rate, maybe he made a good argument?
In any case, keep an eye on volume for a hint of what's to come Monday. Any nice candlestick patterns like a hammer would also be a good thing. I'll let you know if I see anything relevant before the close.
Today it looks like have a chance to post higher volume in a couple of the averages. As for price volume relationships, which I can only bring you after I update after the close, Price Down and Volume up (if the relationship is dominant) is often a short term bottom on capitulation. Even better would be Close Up/ Volume Up. The average itself doesn't need to post that, but a majority of the components do need to have a dominant P/V relationship. That also would be bullish for Monday.
If the BASEL rumor is not refuted, banks should continue to rally although lowering the rate from 3% to 2 or 2,5% as reported would put the banks in a very serious situation if we enter another 2008 scenario which is very possible. Why the Fed would be doing this is beyond me. Apparently Jamie Dimon from JPM had a lot to say to Bernanke about hiking the rate, maybe he made a good argument?
In any case, keep an eye on volume for a hint of what's to come Monday. Any nice candlestick patterns like a hammer would also be a good thing. I'll let you know if I see anything relevant before the close.
It's All About Basel
There's been an ongoing debate and even argument apparently between Bernanke and Jamie Dimon of JPM regarding the BASEL Capital requirements. The chatter has been that the requirements for reserve ratios on the biggest banks was going to be raised. Around 2 p.m. the latest rumor is that it may actually be lowered, the timing can pretty much be determined just by looking at the XLF chart.
Of course these type of announcements are usually leaked so I wouldn't be surprised if there's been quiet buying today before it was announced.
Next up-the denial.
Next up-the denial.
TICK Chart
Look at the change in character of the NYSE TICK chart (advancing issues minus declining issues).
This is the first time today the TICK hit +1000
USO
The USO 5 min chart is in a leading positive divergence so we may very well see a move up very soon.
Financials Update
Market Update
Finally some movement on the 5 min charts...
DIA 1 min Leading positive divergence
DIA 5 min relative positive divergence
IWM 1 min Leading positive divergence
IWM 5 min leading positive divergence
QQQ 1 min
QQQ 5 min leading positive divergence
SPY 1 min relative positive divergences
SPY 5 min approaching a leading positive divergence
If I haven't answered your emails, I will. I just had a router issue and then TeleChart lost real time data so these charts may look a little different as they are from StockFinder.
If I haven't answered your emails, I will. I just had a router issue and then TeleChart lost real time data so these charts may look a little different as they are from StockFinder.
GE Short Trade Idea
FAS SCBO
FAS Second Chance Buying Opportunity
Extremely large volume at $52.01, $52 was the previous intraday high-you know how it works, this is an even lower risk position for a fade using FAS. Just watch for some confirmation.
Extremely large volume at $52.01, $52 was the previous intraday high-you know how it works, this is an even lower risk position for a fade using FAS. Just watch for some confirmation.
On that Financial Counter-Trend Fade
Greeks to Decide Their Own Future
Over the last year there has been extensive discussions on Greece at WOWS. My initial feelings on the subject were that Greece would have been much better off if they were not part of the E.Z. In fact, I've never liked the idea of the EZ. When traveling across the pond, the strength of the Euro was always rubbed in my face. Yeah, it kind of sucked being a traveller with a weaker currency, but as far as the economic perspective, I don't think they quite understood that a strong Euro wasn't exactly in their interest in many way.
One thing about Europe is the fact that you can drive about 4 or 5 hours in any direction and be in a totally different country, a totally different culture and the economic/industrial differences were astounding. For example, Hungary, where I've travelled the most, was once part of the Austo-Hungarian Empire. The basic deal was Hungary provided for the agricultural needs while Austria was a more industrialized nation. To this day, travelling across both countries, the differences are still pretty amazing.
The question that seems to be at the heart of all EU problems is that of, "Can one size really fit all?" I never thought so. While they are all Europeans, the similarities stop right about there. Imagine if Greece controlled it's own currency? Imagine the options that would have been available to them.
Over the last month or so as the demands of the Troika have stepped over the line and crossed into questions of sovereignty. The demands being made just to get the next tranche will put even more Greeks out of work, saddle them with higher taxes and fewer services and if there's one thing Europeans seem to love, it's the social programs. Just look at the riots in France when such programs were put up for debate. Just look at the protests in Greece, some of which have turned deadly for protesters and police.
Since the rumor was floated that Greece would exit the E.U. (and all of the contradictory statements out of the EU on the subject) and despite subsequent denials, I feel it was truly threatened. That hasn't helped much as Germany is still demanding private sector loss participation if it comes to that while the ECB is on the other side worried that any change in terms is tantamount to a default/credit event.
So what are we to make of THIS? You don't even have to read the article, just the title, "Greek PM: Major Reforms Need Referendum"
And how do you think a referendum vote among the Greek people will go down? Although the PM softened the blow by making a case to the people that reforms are urgently needed, it's thinly veiled and once again Greece is saying to the EU, "We will depart, reintroduce our own currency and leave European Banks and other holding the bag for the April 2010 bailout.
This is no small thing. I wish I could find the article I read that laid out the chain reaction of events that would take place if Greece made good on the threat. The bottom line was once all was said and done, Europe would enter an even deeper recession. Ireland and Portugal would have enormous leverage over the Troika and the EU would likely crumble.
I personally feel this is the end game unless the Troika plays ball in a manner the Greeks can tolerate and even if that comes to pass, a credit event will almost certainly be triggered and the result may not be much better. For now, I would pay very serious attention to the headlines out of Greece, Germany and the ECB. This could be an event in which we cannot even fathom the repercussions.
When the time comes, we'll have our short on the euro, but probably most importantly will be the European banking system.
One thing about Europe is the fact that you can drive about 4 or 5 hours in any direction and be in a totally different country, a totally different culture and the economic/industrial differences were astounding. For example, Hungary, where I've travelled the most, was once part of the Austo-Hungarian Empire. The basic deal was Hungary provided for the agricultural needs while Austria was a more industrialized nation. To this day, travelling across both countries, the differences are still pretty amazing.
The question that seems to be at the heart of all EU problems is that of, "Can one size really fit all?" I never thought so. While they are all Europeans, the similarities stop right about there. Imagine if Greece controlled it's own currency? Imagine the options that would have been available to them.
Over the last month or so as the demands of the Troika have stepped over the line and crossed into questions of sovereignty. The demands being made just to get the next tranche will put even more Greeks out of work, saddle them with higher taxes and fewer services and if there's one thing Europeans seem to love, it's the social programs. Just look at the riots in France when such programs were put up for debate. Just look at the protests in Greece, some of which have turned deadly for protesters and police.
Since the rumor was floated that Greece would exit the E.U. (and all of the contradictory statements out of the EU on the subject) and despite subsequent denials, I feel it was truly threatened. That hasn't helped much as Germany is still demanding private sector loss participation if it comes to that while the ECB is on the other side worried that any change in terms is tantamount to a default/credit event.
So what are we to make of THIS? You don't even have to read the article, just the title, "Greek PM: Major Reforms Need Referendum"
And how do you think a referendum vote among the Greek people will go down? Although the PM softened the blow by making a case to the people that reforms are urgently needed, it's thinly veiled and once again Greece is saying to the EU, "We will depart, reintroduce our own currency and leave European Banks and other holding the bag for the April 2010 bailout.
This is no small thing. I wish I could find the article I read that laid out the chain reaction of events that would take place if Greece made good on the threat. The bottom line was once all was said and done, Europe would enter an even deeper recession. Ireland and Portugal would have enormous leverage over the Troika and the EU would likely crumble.
I personally feel this is the end game unless the Troika plays ball in a manner the Greeks can tolerate and even if that comes to pass, a credit event will almost certainly be triggered and the result may not be much better. For now, I would pay very serious attention to the headlines out of Greece, Germany and the ECB. This could be an event in which we cannot even fathom the repercussions.
When the time comes, we'll have our short on the euro, but probably most importantly will be the European banking system.
Greeks to Decide Their Own Future
Over the last year there has been extensive discussions on Greece at WOWS. My initial feelings on the subject were that Greece would have been much better off if they were not part of the E.Z. In fact, I've never liked the idea of the EZ. When traveling across the pond, the strength of the Euro was always rubbed in my face. Yeah, it kind of sucked being a traveller with a weaker currency, but as far as the economic perspective, I don't think they quite understood that a strong Euro wasn't exactly in their interest in many way.
One thing about Europe is the fact that you can drive about 4 or 5 hours in any direction and be in a totally different country, a totally different culture and the economic/industrial differences were astounding. For example, Hungary, where I've travelled the most, was once part of the Austo-Hungarian Empire. The basic deal was Hungary provided for the agricultural needs while Austria was a more industrialized nation. To this day, travelling across both countries, the differences are still pretty amazing.
The question that seems to be at the heart of all EU problems is that of, "Can one size really fit all?" I never thought so. While they are all Europeans, the similarities stop right about there. Imagine if Greece controlled it's own currency? Imagine the options that would have been available to them.
Over the last month or so as the demands of the Troika have stepped over the line and crossed into questions of sovereignty. The demands being made just to get the next tranche will put even more Greeks out of work, saddle them with higher taxes and fewer services and if there's one thing Europeans seem to love, it's the social programs. Just look at the riots in France when such programs were put up for debate. Just look at the protests in Greece, some of which have turned deadly for protesters and police.
Since the rumor was floated that Greece would exit the E.U. (and all of the contradictory statements out of the EU on the subject) and despite subsequent denials, I feel it was truly threatened. That hasn't helped much as Germany is still demanding private sector loss participation if it comes to that while the ECB is on the other side worried that any change in terms is tantamount to a default/credit event.
So what are we to make of THIS? You don't even have to read the article, just the title, "Greek PM: Major Reforms Need Referendum"
And how do you think a referendum vote among the Greek people will go down? Although the PM softened the blow by making a case to the people that reforms are urgently needed, it's thinly veiled and once again Greece is saying to the EU, "We will depart, reintroduce our own currency and leave European Banks and other holding the bag for the April 2010 bailout.
This is no small thing. I wish I could find the article I read that laid out the chain reaction of events that would take place if Greece made good on the threat. The bottom line was once all was said and done, Europe would enter an even deeper recession. Ireland and Portugal would have enormous leverage over the Troika and the EU would likely crumble.
I personally feel this is the end game unless the Troika plays ball in a manner the Greeks can tolerate and even if that comes to pass, a credit event will almost certainly be triggered and the result may not be much better. For now, I would pay very serious attention to the headlines out of Greece, Germany and the ECB. This could be an event in which we cannot even fathom the repercussions.
When the time comes, we'll have our short on the euro, but probably most importantly will be the European banking system.
One thing about Europe is the fact that you can drive about 4 or 5 hours in any direction and be in a totally different country, a totally different culture and the economic/industrial differences were astounding. For example, Hungary, where I've travelled the most, was once part of the Austo-Hungarian Empire. The basic deal was Hungary provided for the agricultural needs while Austria was a more industrialized nation. To this day, travelling across both countries, the differences are still pretty amazing.
The question that seems to be at the heart of all EU problems is that of, "Can one size really fit all?" I never thought so. While they are all Europeans, the similarities stop right about there. Imagine if Greece controlled it's own currency? Imagine the options that would have been available to them.
Over the last month or so as the demands of the Troika have stepped over the line and crossed into questions of sovereignty. The demands being made just to get the next tranche will put even more Greeks out of work, saddle them with higher taxes and fewer services and if there's one thing Europeans seem to love, it's the social programs. Just look at the riots in France when such programs were put up for debate. Just look at the protests in Greece, some of which have turned deadly for protesters and police.
Since the rumor was floated that Greece would exit the E.U. (and all of the contradictory statements out of the EU on the subject) and despite subsequent denials, I feel it was truly threatened. That hasn't helped much as Germany is still demanding private sector loss participation if it comes to that while the ECB is on the other side worried that any change in terms is tantamount to a default/credit event.
So what are we to make of THIS? You don't even have to read the article, just the title, "Greek PM: Major Reforms Need Referendum"
And how do you think a referendum vote among the Greek people will go down? Although the PM softened the blow by making a case to the people that reforms are urgently needed, it's thinly veiled and once again Greece is saying to the EU, "We will depart, reintroduce our own currency and leave European Banks and other holding the bag for the April 2010 bailout.
This is no small thing. I wish I could find the article I read that laid out the chain reaction of events that would take place if Greece made good on the threat. The bottom line was once all was said and done, Europe would enter an even deeper recession. Ireland and Portugal would have enormous leverage over the Troika and the EU would likely crumble.
I personally feel this is the end game unless the Troika plays ball in a manner the Greeks can tolerate and even if that comes to pass, a credit event will almost certainly be triggered and the result may not be much better. For now, I would pay very serious attention to the headlines out of Greece, Germany and the ECB. This could be an event in which we cannot even fathom the repercussions.
When the time comes, we'll have our short on the euro, but probably most importantly will be the European banking system.
Financials Chart Request
I'd also watch for this potential pattern in FAZ as a timing cue
Financials Chart Request
GLD
My opinion on GLD long term hasn't changed, but in the short term as in intraday today, there's a pretty positive looking 3C chart
The divergence can be seen on the 5 min chart and looks like it's making its way to the 10 min. There may be a decent little swing trade in GLD.
UUP/$USD Continued
Very early Thursday a.m. I posted on the dollar and how it seems to be under accumulation, but in a very tight and specific zone, very low in the range.
30 min chart showing accumulation areas.
Now that UUP is up .80% today, it looks like the specialist may be trying to knock it down again back into the accumulation zone. This divergence hasn't made it to the 5 min chart yet, but it's very early.
Follow up on the early market update
These are the 1 min charts for the DIA, QQQ and SPY.
As suggested in the last post, they were trying to find some footing/support and the SPY/DIA have done so. The Q's continue to look the worst because technology and specifically semi-conductors haven't been able to find any footing where as energy and financials have.
We'll have to wait to see if these divergences lead and migrate to the 5 min chart to determine if we have more then a temporary consolidation or a short term bottom.
Yesterdays USO short Call
At 1:43 yesterday I put out a short term trade, short USO. From the entry area, it dipped ad then gained about 2/10ths of a percent. This trade was based on a long nearly 3-day 1 min divergence. This morning it certainly is paying off, especially if you used a leveraged vehicle as suggested.
Where the post came out.
Here's the current situation
The downtrend is confirmed, but we have a 2.67% gain on the short in USO alone, if you used a leveraged vehicle like SCO you should have about a 5% gain.
You might consider taking some profits off the table if you were taking the short term trade.
Here's the current situation
You might consider taking some profits off the table if you were taking the short term trade.
Early Market Update
EEE
Yesterday I mentioned EEE-a Cats and Dogs Speculative trade, it just broke the 2.00 area I was looking for.
You may want to consider this one. These C&D trades can easily rack up double digits returns in 1 day.
