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19
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4:30am BoE Minutes
8:30am Earnings Before the Open: BJ, EV, LDK, MENT, ROST, TSL, TWB.
8:30am Oct CPI (last m/m 0.0%, y/y 4.9%; ex food & energy last m/m 0.1%, y/y 2.5%)
8:30am Oct Housing Starts (last 817K), Oct Building Permits (last 805K)
9:00am Fed’s Kohn speaks on asset prices at conference.
10:35am Crude Oil/Gasoline/Distillate Inventories
1:30pm Fed’s Lacker speaks on the subprime crisis at conference.
2:00pm FOMC Minutes
4:00pm Earnings After the Close: CYBX, DBRN, EGLT, GYMB, HOTT, INTU, LTD, LDG, MW, PETM, PLNR, SMTC, TK, WGOV.
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Gannfann’s numbers and comments for 11/19:
871-873 2nd resistance
855-856 1st resistance
823-825 1st support
811-813 2nd support
Prices will begin to sell off again and break to the downside as we get the corrective move from yesterdays rally. Keep in mind that prices must break the 838-840 range to confirm that prices will retest the prior lows. Since we have rallied off the low prices are getting tighter so the main trend will resume again. It is vital for the bulls to hold the 838 range and gain some strength or prices will break again and very likely reach the 820 area. I still see prices going into the 770 range very soon, so I believe that any rally should fail in this environment or has a high probability to fail.
Keep in mind that we have tested the 820 range two times and every rally has been sold into and lacked momentum. This leads me to believe that the only chance the bulls have here is for strength to step in here soon because the longer prices hold and test the low support ranges the more likely the possibility for a break of those ranges.
November 19th, 2008 at 9:22 am
The late rally on Tuesday was due to BUD dropping out of the S&P (bought by InBev) and fund managers having to buy up the other 499 shares on the order of some $42B in buy orders to stay balanced before the close. Shorts saw this push and many covered which fanned the flames of the rally.
In other words, it was an anomoly, otherwise the SPX would have closed around 827 or lower (the point where the push started)!
November 19th, 2008 at 9:26 am
Excellent work. Never get that from the talking heads.
November 19th, 2008 at 9:52 am
Art Cashin said that on CNBC this morning
5 yr TNotes yield down .1% after set multiyear closing low yesterday.
10 yr bond yield down 1.78%
30 yr bond yield down 2%
November 19th, 2008 at 9:21 am
Good to see some continuity in life these days…here’s your Gannfann AM post. I’m getting spoiled.
Yen crosses screaming higher with very big gains in the last 15 minutes. EUR/JPY AUD/JPY and GBP/JPY much higher. I would think this will lead to higher equities this morning. I’m buying ES here.
Pete
Whipsaw Wednesday.
I am keeping my shorts for long term, but will probably get in on the long side if we get a big break down on low volume. Seeing a possible rally ’till Dec.
No charts…just “guessing”
Confirmation of the long side is if we break Shanky’s blue channel around 860
This is not my blue channel, but is is an indicator that something has to give today. SPY for a change. Dominant channel down with three sub channels since the last high. The oval at the end denotes that this pattern will eother continue thru support/bottom or bounce today. That’s it. To me this is a big day one way or the other. I am noticing a lot of chart patterns ending today. I’m hoping for a fakeout low and then a rally. Buyers have to come in or else.
http://social.stocktock.com/photo/spy-channels-and-more-channels
November 19th, 2008 at 9:34 am
I no it not “your channel” thats just how I am referencing it
November 19th, 2008 at 9:44 am
That’s cool. I believe that trendline is very valid and worth watching closely.
maybe right shoulder forming on inverted hs
was that rise a gap fill?
November 19th, 2008 at 9:53 am
not sure but it didnt fill it
SPY 200ma on the 10m is 86.82 (non AH) which stopped the SPY cold.
November 19th, 2008 at 9:44 am
That bogus rally (see reply in post #1) in the last hour yesterday really screwed up the intraday charts. Grrrrr.
November 19th, 2008 at 9:46 am
I try to ignore fakeouts and will eliminate their spikes from consideration. The EW guys have taught me that it is ok to change your fomations multiple times!
Bluse channel update. there is another black channel that has formed that i will refer to inside the almighty blue channel.
http://social.stocktock.com/photo/shankys-blue-channel-update
It looks like the VIX is possibly going to form a H&S (I know – another H&S) LS and H are in and forming over a neckline that is a longterm trendline that is resistance turned support. If that breaks later today and we get volume it would be nice. 15% probability and declining on my ability to predict these things.
10-day $VIX still strong.
http://social.stocktock.com/photo/10day-vix-still-strong
November 19th, 2008 at 10:01 am
Do you see the H&S forming from yesterday and today with the support/neck at 67? I want to get long today. If the right shoulder comes in, a risky purchase at the peak would be nice entry for a small play with the balance of the trade coming on the breakout. We’ve got to get volume in though.
SPY max pain at 95 and currently at 85.90. Something has got to give.
This afternoon will be interesting.
November 19th, 2008 at 10:11 am
“Perhaps” on the H&S; time will tell. I frankly don’t know where the Billions would come from to drive this market up to limit the option writer’s pain. These option writers are tapped out after having their asses handed to them in September.
I don’t think a rally will come – just takes too much money to move it and there are a lot of sellers above just waiting to get out – especially those who bought last Thursday!!
November 19th, 2008 at 10:57 am
Yes but there wasn’t too much volume last Thursday.
fall below 855 resistance level
Could volume be any lower? Sheesh.
Ten year yields are down another 1.5% (conversely, 10 year note is up 1.5%) Flight to quality continues. Joe K on CNBS tried to make a case that S&P yields are about the same as 10-year note so why not buy stocks? The guest was a bit wishy washy on his answer.
My reply would have been: Duh. S&P500 index fund would be a great buy here if the total return is better than 10-year yields. I don’t trust the forward earnings potential nor do I trust the S&P yields going forward.
November 19th, 2008 at 10:00 am
Isn’t the idea if the yield is about the same to buy the safer investment? That would be the Treasury.
November 19th, 2008 at 10:07 am
Of course! CNBS is a cheerleader for stocks. A good number of CNBS anchors are like used car salesmen (or real estate agents) who will tell you – no matter which day of the month, or which month it is – it is the best time to buy a car and if you don’t buy that it will be gone in a zippo. Same with real estate agents.
Likewise, for CNBS anchors, it is always good time to buy stocks.
November 19th, 2008 at 10:13 am
Cramer is the biggest joke of all. It is all manipulated. Blogs are the only real source of info. Truth or not on the blogs – you don’t get the hype. They hate the internet. It tells the truth and the powers that be are losing control because of it.
Mohan and others – I took this from tdtrader.com. This is a site I have found very useful in the two days I have been there. They offer a free two week membership that does not require a cc. How about this to possibly explain the t-bills actions……
***T-Bill Yields Fall Again*** The 13-week TBill Yield ($IRX) closed at .09% on Monday and continues to offer virtually no return on investment. T-Bills offer a low-risk place to park large amounts of money for a short time. Is risk aversion really the reason? Some pundits think the Fed is buying up short-term T-Bills to drive the yield down and to discourage institutions from buying T-Bills. The low yields in Sep-Oct were most likely caused by financial institutions buying T-Bills in a flight to safety. However, the November decline could be different and the Fed’s invisible hand could be at work. If banks do not buy T-Bills because of their ridiculously low yields, then they must do something else with their money. This means loaning it out other banks and businesses to get the credit markets moving again. I find this theory interesting, and even plausible. I will continue to focus on the 13-week TBill Yield ($IRX), but will keep an open mind with regards to stocks. In other words, low TBill yields may not necessarily thwart a rally.
November 19th, 2008 at 10:07 am
They also have great (but long) videos.
November 19th, 2008 at 10:10 am
Another point from his notes today was that the funds that went in in the big rush over the past few days will be coming available in Jauary right before the election. these are funds that will help fuel the election rally. I believe we have found the key to play the super move up in January. Can’t wait to be long for that. I’m already excited!
November 19th, 2008 at 10:09 am
I don’t know all these stories. But there is a lot of intervention in the T-bill market by Feds. Also, I heard that there is a major anomaly in the 30-year bond swap rates, which turned negative this morning. I am trying to find the significance of this on stocks.
I believe this rally is to much to fast and not based on real volume , seems to me TA’ers expecting a bounce are pushing this up and we could see a sharp downward reversal in the afternoon as the rally loses steam.
ES 1m may be putting in a pretty double top. Or not?
November 19th, 2008 at 10:16 am
Testing top of black channel inside blue.
The SPY daily is looking like a coiled spring.
Did everyone put on a new pair of shorts?
November 19th, 2008 at 10:33 am
Hah! You don’t live in MT.
I believe the inverted head and shoulders will come into play before 12 oclock, we should see some consolidation first and a push higher.. Make sure the volume stays light on consolidation before you buy in.
November 19th, 2008 at 10:28 am
With the 10m STO and CCI overbought, I think we drop hard.
November 19th, 2008 at 10:29 am
Thanks for your input. It is appreciated.
Any thought on the H&S I’m seeing on the VIX over the last two days. It seems to coinside with your thoughts.
http://social.stocktock.com/photo/vix-hs-today
November 19th, 2008 at 10:33 am
they will probalby happen at the same time… the question is will they happen?
and i’m leaning towards yes…
ES 1m may be trying to form an channel up. It put four tails over the black channel top to possibly form a double top. Volume does generally suck.
http://social.stocktock.com/photo/vix-hs-today
Where is the VWAP? ES 1m 100d ma was the stopping point on the last decline. This was a good indicator yesterday as initial support.
This is what I am referring to earlier. Can anybody explain the significance of this?
Meanwhile, the 30-year swap spread was stuck in negative
territory, following Thursday’s poor $10 billion 30-year
Treasury bond auction, they said.
Thirty-year spread was last quoted minus 15.50 basis points
after hitting a record low of minus 20.00 basis points. It
finished at minus 11.25 basis points on Thursday.
http://www.reuters.com/article/companyNewsAndPR/idUSN1453660620081114
ES testing bottom of intraday channel up at 850. I hope this holds so I don’t have to figure out another pattern for a while.
November 19th, 2008 at 10:40 am
What is the # for the top of the channel? We appreciate your good guesses!
November 19th, 2008 at 10:44 am
The two most recent tops on the ES mark the top. The bottom is very clear. Starts at 8:49.
Not perfect but close enough for a dumbpainter LOL.
The 2 day VWAP has held earlier at 849. We are about to test it again. Yesterday, we ran up to the 2 day VWAP but didn’t close above it. Daily swings between the 1 day and 2 day VWAP. If we break below the 2 day VWAP, I’m leaning towards further selling.
November 19th, 2008 at 10:44 am
Thanks. Since the SPX is rolling over (overbought) we will slice right through it. I also think the H&S pattern is bogus since the rally late yesterday was bogus (see post #1).
November 19th, 2008 at 10:46 am
We broke…
November 19th, 2008 at 10:48 am
842 would the the 61.8 Fib retrace from yesterday’s highs to the lows.
Breaking down – next stop 843.
November 19th, 2008 at 10:55 am
Market made the decision to move and stay lower when oil/gas inventories came in above estimates. Materials/industrials following O&G decline. Look at the B-Berg intraday summary of indicators. There is no incentive to go long here. I got into EEV yesterday EOD and am staying there (for now).
SPX down trend confirmed by 15min 8ma criteria.
I forgot to post earlier that my intraday channel up could have been a bull flag.
Boy it’s very hard to get long this market. All Yen crosses reversing and going lower. ES trades below VWAP at 849 and I have cut my longs.
Pete
If 843 does not hold look for gr’s numbers to come into play
823-825 1st support
811-813 2nd support
I like 826, 816
XLF just broke to new lows. Turn out the lights (again.)
Possible Fake out!!! Warning… this market is heading higher
November 19th, 2008 at 10:59 am
In my lifetime? Look at industrials/financials/materials/O&G.
EEV is where to be.
MACD Bearish cross on the 10m SPY and far from oversold. We’re gonna keep droppin’.
My next support at 835.17, next key Fib level
Bullish cross on all $VIX 10m indicators.
5 yr TNotes yield down 1.2% after set multiyear closing low yesterday.
10 yr bond yield down 2.5%
30 yr bond yield down 3%
While some of you are seeing bullish divergences in stocks, I am looking at smart money buying T-notes. Look at the 10-year yields. They are dropping like a stone. Down another 8.7 basis points or 2.47%. This is on top of the 4.04% drop yesterday.
ye warned.
November 19th, 2008 at 11:05 am
Keep us updated. Thx.
November 19th, 2008 at 11:05 am
I think as long as the rally in treasuries continues abated like this, any bounce in equities will be short lived.
November 19th, 2008 at 11:13 am
Agreed.
November 19th, 2008 at 11:47 am
if we even have a bounce
November 19th, 2008 at 11:52 am
Just trying to hedge my statement.
Updated VID HS formation. We can take out 70, and if we do I’ll be nervous. I might go long when I think the VIX is topping out. This looks good and coincides with Idian’s idea (at least i think it still does).
You guys. If we do make a turnaroud sometime today NEM may be an intraday trade. Is in the green with the rest of the board red; held up when the market began to fall an hr ago and at $24 a person can load up enough to make it worthwhile. IF the market turns later today. Big IF.
Yet another inverse H&S. forming head now. Neckline at 862. Seems like a long way away but just an FYI. 5m ES
bear flag on ndx?
Here are some reliable bottoming clues (see 10m chart). We are far from today’s bottom it seems:
http://social.stocktock.com/photo/intraday-bottoming-clues-on
Bottom is in when CCI crosses up from below -100,
MACD histogram is 50% away from crossing the zero-line,
and STO has been below 20 for at least an hour.
November 19th, 2008 at 11:25 am
Nice chart – you can see Idian’s inverted H&S forming nicely as well.
NOW – there have been a multitude of fantastic large bull formations fail over the past several days due to lack of buyers. I am prepared to play this either way with tight stops in both cases.
November 19th, 2008 at 11:26 am
I think the H&S is busted.
November 19th, 2008 at 11:28 am
You can also see that the RSI is back below the trendline that was violated yesterday due to the bogus push due to BUD. We now are back on track.
November 19th, 2008 at 11:44 am
being on the fence sucks. fundamentals tell us lower lower lower. market manipulation tells us possibly higher. im short oil at $55 and that is it for now. 4% gain there so far. lets see if we get to 825… bounce from there or collapse. everytime this market tries to tank it bounces… one try too many?
VIX at 70.
Mkt is going higher IMO. It’s not ready yet for that next leg down. Too many people are expecting the collapse.
flare
November 19th, 2008 at 11:33 am
I’d sure like to understand those!
November 19th, 2008 at 11:35 am
Maybe means a change in direction?
837, the next key Fib level reached! If we can’t hold here, yesterday’s low of 825, is the next key level.
SPY finding some support at S2.
November 19th, 2008 at 11:35 am
Correction; S1.
November 19th, 2008 at 11:36 am
Nevermind, it caved.
SPY 1m WTF is that spike about 5m ago?
I’m thinking this is an awfully fast fall on light volume – Bear trap?
November 19th, 2008 at 11:38 am
I’m getting long plays ready. EEV, SSO and maybe a few others. This may be the kiss of death, but I cen go short just as easily. I just don’t think today is the day we give up the ultimate bottom.
November 19th, 2008 at 11:40 am
I did not mean EEV, sorry. Although this may prove a good entry point for that anyway where we are headed.
November 19th, 2008 at 11:42 am
EEM is a play, altho it’s not dbl leveraged…
Have you found any dbl long Intl etfs?
November 19th, 2008 at 11:38 am
$VIX 10m says we have more to go. It’s midrange.
November 19th, 2008 at 11:43 am
Might be closer than midrange. Not gonna split hairs with you. I think we are on the same page.
Got any bright ideas to play on the bounce?
I’m only planning on playing today and not swinging (at least not a full position).
November 19th, 2008 at 11:47 am
You expect a bounce? Silly boy. You’ll never learn!
November 19th, 2008 at 11:46 am
The VIX climb up yesterday formed a channel on the 1m and threw in a fakeout pennant before heading higher. Any thoughts on the VIX possibly putting in a double top? do you think the indicators can get it to 73? I’d get bullish then for sure.
November 19th, 2008 at 11:53 am
Hard to say, but it’s heading that way.