|
20
Nov
|
11:50am
I will have to step out for today, but I do see an inverse head and shoulders developing, however the move higher is on light volume. The best advice I can give you, is to probably watch what the market does today, it’s a Friday and it can be very volatile. I feel more confident going short longer term, but i know we’re also overdue for a bounce.
11:06 am
No bottom for market in sight, market hitting new lows at 742 S&P.
10:01am
I have a really hard time seeing this market continue to fall, it needs a counter trend rally towards fibonacci retracements in order to keep this fall going. I have not added shorts back, I am waiting on this one.
9:55am
Craig: ES 10m: 200MA important resistance
Thursday Night, 10:00 pm
Hey guys. In preparation for a potential bounce tomorrow, I have covered my shorts after hours. One thing to look at tomorrow is Fibonacci retracements, I believe adding to your shorts at the 50% level, and maybe (if we get there) the 61.8% retracement levels will be a great way to play the markets.
60 minute SPY ETF
How are you guys playing this market?
I know tomorrow is OpEx…but look at the flight to safety. Experienced bond traders are mostly shocked and awed by the move on the long bonds….
We may have a choppy day tomorrow, but a sustainable rally….well, would you hold a long position going into this weekend with C at $5?
November 20th, 2008 at 10:30 pm
An after market bombshell? FDIC could be working the weekend phones…
November 20th, 2008 at 10:48 pm
it looks very attractive.. i would hold a long position with out of the money puts on there..
I agree totally – I sold 80% of my put spy dec put options at the close. If you look at the last plunge (as perfectly shown in Idan’s graph – the Fib retracement hit the mark right on – giving a perfect entry piont to short. My only concern is that I think the financials may have bottomed….historically they are the first to go down – and they usually have to be the first to bottom – and if we are not there now – we are close. That is not to say that other individual stocks are not done going down….I just believe that instead of being short the market…I am going to start focusing on specific stocks…..
I have to trade in a cash IRA with a three-day settlement period, and did essentially the equivalent, selling out of all levered bear ETFs so I can be positioned with cash when they are cheaper, which might wait untiol the week after next. Look at the $SPX move a month ago from 845ish to 1007, breaking most of the same MAs and other resistances. Why not a similar bear rally from here at 745 to about 900ish? That would still be under the long downtrend line thru 1265 and 1007. Cropped chart image:
[IMG]http://i36.tinypic.com/726mwk.gif[/IMG]
November 21st, 2008 at 12:22 am
Direct link to cropped image of S&P chart:
http://i36.tinypic.com/726mwk.gif
I went long with a double ETF at 747 and 757. I bailed out of my short ETF the day before at 833. Looking at the futures tonight, I now have an idea what was discussed at the G20 shrimpfest, how to create the “Mother of All Bear Traps”. I looking for a minimum of 50-100 SPX point rally at OpEx. Definitely planning on holding cash over the weekend, this market smells too crooked to trust positions that long any more.
Ya know I think the futures are up to much if that makes any sense at all. I think there is potential for a big drop at open if we even tap yesterdays lows.
Comments from GS
LONDON MORNING ROUNDUP – Friday, November 21, 2008
HIGHLIGHTS
WSJ: Citi Weighs Its Options, Including Firm’s Sales
Euroland November PMI Manufacturing 36.2 – lower than expected
Euroland November PMI Serivces 43.3 – lower than expected
WSJ: Auto Makers’ Rescue Drive Stalls
CURRENCIES
EUR/USD 1.2425 – 1.2625 Last: 1.2592
USD/JPY 93.57 – 95.96 Last: 94.94
EUR/JPY 116.44 – 120.65 Last: 119.54
GBP/USD 1.4713 – 1.5062 Last: 1.5028
EUR/GBP 0.83715 – 0.84978 Last: 0.8380
USD/CHF 1.2190 – 1.2298 Last: 1.2221
EUR/CHF 1.5219 – 1.5418 Last: 1.5389
AUD/USD 0.6076 – 0.6279 Last: 0.6228
USD/CAD 1.2747 – 1.2985 Last: 1.2784
NZD/USD 0.5194 – 0.5347 Last: 0.5292
SUMMARY
After extremely ugly closes in the US equity market (SPX closed below the important 768 post dot-com bubble lows -Technically we are now looking to 500), Asian equities posted a decent rally overnight with Kospi up 5.80%, NKY up 2.70% and Hang Seng up 2.93% and other Asian bourses were very much bid. The squeeze in Asia seemed to be the result of four main stories 1) A WSJ article that CITI is weighing its options, including a possible share sale. 2) Reports that China will allow HK banks access to funding from PBOC. 3) Fannie Mae and Freddie Mac are suspending foreclosures until Jan 2009 while the streamline their modifications programs. 4) A vague rumor of weekend Fed meetings and Quasi-official buying of equities in Asia (Unconfirmed) – The bounce however could be the result of a short mkt community worried about a big policy weekend and therefore taking off risk . Worry is that without mkt positive policy announcement over the weekend, the equity response on Monday might not be pretty.
In FX, EM risky assets rallied with TRY +1.81% and ZAR +1.30% stronger, surprisingly however X-JPY failed to rally with AUDJPY down -0.52% and USDJPY down -0.91%. This morning we have seen good two way flow in the EUR with leveraged names selling around 400m EURUSD, while Real money and short term spec names stoped out of their short EUR positions and bought back around 300m. On the data front we had very weak PMI data out of Europe, as the recession there looks to be gathering pace – Manufacturing came out at 36.2, while consensus looked for 40.5 while Services were at 43.3 consensus 45.2 – Bottom line is that we are seeing massive contraction in Eurozone factory output, and very worryingly the employment index, which tend to be less volatile, fell almost as sharply as the manufacturing sector (41.3 after 44.5 in October and 47.0 in September).
Hopefully this bounce in equities can last till NY close and fingers crossed we will get some positive policy news over the weekend and therefore continue to see Green up on our screens next week. Have a great weekend and good luck.
November 21st, 2008 at 8:48 am
More from GS
FX Movers and Shakers – Friday, November 21, 2008
Trading Strategy – Random Bounces. The good news is that Asian equity markets flipped from horrific to up. The driving force behind the change in mood from New York’s disastrous equity close to something else rests on: 1) talk of the PBOC cutting rates 1.5% soon; 2) talk of various governments buying’s shares – Korea being first in line; 3) HKMA telling market that PBOC will offer up liquidity to any HK bank; 4) Fannie Mae and Freddie Mac offering to stop foreclosures until 2009. Bottom line – we had a bounce and the fundamentals don’t matter as much as the price action as it shifted the doom and gloom to some sort of base for hope. Most people want the markets to just be stable and flat until 2009. That is a long time away. The fear forces behind yesterday’s US selling spree rest with the idea that the economy is much weaker than previously expected – and the GS team recognized that point and cut its 4Q GDP accordingly to -5%. The equity market caught up with the weaker outlook yesterday driven by the Philly Fed and the host of other weak data. The other driver of fear has been the view that FED and US Treasury are on hold. Today we only get FED speak – and its likely to be direct about the quantitative easing that has dominated headlines. Being more specific about new ways of expanding the money supply, targeting bonds and keeping liquidity over abundant – all that should be in the speeches. Behind that the market will think inflation, doubt the ability of the governments of the world to pay for it all, and the push for duration rather than yield may abate if only for a day. FX will take its cue from yields and stocks again – with EUR/JPY, AUD/JPY the leaders. Interest in CHF is probably the best thing to watch as EUR/CHF didn’t work well on the way down and its leading the way up. CHF focus is linked to financials which remain the heart of the world’s concerns. Hope in the US that we get something big continues – and mergers in financials or new bailouts hold up some to think we end a horrible week on the uptick.
Main Movers – AUD up 1.95% to .6225; GBP up 1.8% to 1.50; NOK up 1.6% to 7.09; EUR up 1.1% to 1.2590; JPY off 1.15% to 94.70.
November 21st, 2008 at 8:34 am
Thanks Pete. Lots of good nuggets in there.
Gannfann’s numbers and comments for 11/21/08:
786-788 2nd resistance
770-774 1st resistance
740-742 1st support
720-722 2nd support
Expect prices to sell off again as prices attempt so short term bounce retesting the prior low of 770-777. This should provide resistance on the bounce. DO NOT TRUST THIS MOVES!!! ONLY TRADE THEM WITH STOPS AND VERY SHORT TERM!! Prices will retest the prior lows DO NOT BE FOOLED!! the risk / reward is not there and must be traded very carefully. I expect prices to break down again and I think we will see unemployment increase and the market go to 400!!! Protect your family and investments.
Traders should expect heaving selling pressure into next week.
I will look for set-ups at the 20ma, either way the market goes. The charts tell me what to do.
November 21st, 2008 at 8:42 am
What time frame do you use for your 20ma setups. Can you please expand. TIA.
November 21st, 2008 at 10:00 am
I use the 15m, two day chart. The best set-ups have been with SKF and SRS.
I want the price to either break above the 20ma, and confirm, or kiss the 20 and confirm. Yesterday was unusual because it work on the 40ma for one and the 50ma for the other, but it still worked. 9 out of 10 times it works with the 20ma.
I use very tight stops and will stop out with gains in the 5% to 10% range, but as you can see they usually go up much farther. I am back to all cash at the end of every trading day. I will let my small gains add up.
November 21st, 2008 at 10:03 am
OOPS, The reply is with my first post.
Good Luck
long bond price up yet another .15%
November 21st, 2008 at 8:33 am
I think the Bonds are holding steady over the weekend.
November 21st, 2008 at 8:46 am
gr;
where are you looking at?
thanks
November 21st, 2008 at 10:21 am
premarket, look at TLT. during market, look at $TYX
Anyone trading QID’s today….what would be a good entry in today? I think if it pull back around $87 could be good point to get in as i see market go up early than try to retest the lows again.
A vague rumor of weekend Fed meetings
It would not surprise me that it happens, Fed rate cut before the Thanksgiving holidays?
Something to really rally the market.
November 21st, 2008 at 9:09 am
Why? the last rate cuts didn’t. Any move by the fed to lower rates will be seen as desperation and drive the market even lower.
on what plattform?
no i’m not familiar with that platform.. sry
November 21st, 2008 at 9:42 am
right click on the chart and click on add then volume
I agree only a temporary rally on any rate cut.
Earlier comment said that bond price was up .15, am I reading this right it actually dropped & the yeild went up .15?
Thanks
(from bloomberg as of 9:08 am)
PRICE/YIELD
CHANGE
-1-12+ / .157
November 21st, 2008 at 9:21 am
If I recall correctly from a couple days ago it was explained that as bond prices go up and yeilds drop it signals a flight to safety. As in investors are willing to put there money in any safe instrament no matter how low the gain would be.
If I have this backwards please someone correct me.
November 21st, 2008 at 10:23 am
long bond means 20+ years. $TYX is still down 0.9% right now and has been in the red since market opened.
Tom, using Pivot points, S1=89.98 and midpoint 85.68.
Pls post when you enter qid with price point. THanks.
The wheels have come off C already. Keep an eye on it , it has been a leading indicator for the past 2 days.
I’m actually watching the market today and listening to CNBC. Everyone is talking about a bottom! It’s frustrating for me to watch, but it gives me a clue to sentiment. Most people think this is a bottoming process and its time to start buying. I don’t think they are right.
November 21st, 2008 at 9:45 am
Nice to see you on board.
November 21st, 2008 at 9:46 am
After the Great Depression, the mere mention of the word “stocks” was looked down upon because people had been burned so badly. The idea of buying stocks during the 1930s was considered crazy and reckless.
This type of psychology and sentiment will also represent this bottom. The crowd has been trained to look for bottoms and buy weakness. It has worked for some 80 years. That habit needs to be broken, and it
certainly has not yet.
November 21st, 2008 at 9:51 am
Welcome back Craig. I completely agree with what you are saying, but I think we are years (maybe 2-4) away from that happening. Even if the S+P dropped to 500 tomorrow, you would still see buyers come back in. We need to get to the point where people actually believe the great economic past we had before is gone forever. Then you will see people throw in the towel. I just think we need more time and very bad economic numbers going forward for that to happen. Maybe unemployment at say 12 -15% would do the trick.
Pete
November 21st, 2008 at 10:00 am
Yes, I think you’re right. Psychological capitulation will be more a product of time than price, and may take a number of years.
November 21st, 2008 at 9:46 am
welcome back stranger. Nice to see you here.
November 21st, 2008 at 9:48 am
I agree with you. Capitulation hasn’t happened yet. The end of the day sell offs are not enough. We need to crack the faith of those who are holding on becase it’s “to late to sell”. Untill those people give up on the market completely and sell off we are destined to go lower as the market whipsaws people with money left to trade.
November 21st, 2008 at 10:30 am
Gannfann sees S&P 400 in not too distant future. Stoneleigh said before the market finally bottomed out for this depression, DJIA should be in sub 1000 level – that is if the market and the index still exist…
what do you guys think of silver? chart looks like it might of found a bottom around 9 if market gets cut in half again there should be some panic buying in silver and gold.
November 21st, 2008 at 11:43 am
just buy Silver American Eagles and put them in your closet………seriously.
Daily VWAP: 770 – ran into it and retreating
2 day VWAP – 783
Don’t believe it. Bought DUG and FXP.
November 21st, 2008 at 9:55 am
Will cover at 735 today.
November 21st, 2008 at 10:09 am
same structure as yesterday on S$P.
C about to try to set new 52 wk lows.
November 21st, 2008 at 9:58 am
and over the cliff it goes
November 21st, 2008 at 10:00 am
Would anyone on here touch it at any price?
November 21st, 2008 at 10:02 am
Given the panic selling I’m seeing right now I might have a go at it when the terror subsides for a daytrade.
November 21st, 2008 at 10:03 am
Looks like full on panic in C
November 21st, 2008 at 10:03 am
I kinda like it around 4 for a pop.
November 21st, 2008 at 10:04 am
Just hit 3.93 then back to 4.10 in about 5 secs
November 21st, 2008 at 10:08 am
Not me , I’m not that experinced but I still see to much selling into the push ups. Gotta break the day traders playing for a pop now.
November 21st, 2008 at 10:14 am
Here we go the bottom of this fall is where I will like it for a real pop.
November 21st, 2008 at 10:16 am
Scratch that, I like it at 2. Ha!
November 21st, 2008 at 10:21 am
I just can’t bring myself to pull the trigger on this. It still doesn’t feel right.
GOOD MORNIN – Had a meeting this AM. Bad time for a meeting but got to keep the kids in shoes you know. I’ll get a grip in this market and be back when I have something to contribute. Nice to see Craig back in the saddle. Welcome back!
November 21st, 2008 at 10:34 am
I took profit on my long GBP/USD position overnight at 1.5040
It wasn’t looking good yesterday evening as I watched it drop to 1.4713
It had a big move so I decided to take profit.
I still like it higher and believe you can buy dips down to 1.4750 1.4800 area.
Pete
November 21st, 2008 at 10:12 am
Well done. I like your currency calls. They are a great addition to the board. congratulations. I was not raggin on you yesterday. Hope you know that.
November 21st, 2008 at 10:42 am
No worries. I understand. There’s a saying “you’re only as good as your last trade”. Ha Ha.
Good luck today.
Pete
wow wow wow… a gift from god this morning. bounce up in all my short positions so i could get all my soldiers working in one direction………….down. however, i cant watch. im no longer going to try and play bounces… it has cost me dearly. my best trading days have been days where i did not trade. put your soldiers to work short on any rally if you are so luck to see another rally . people are rushing to thier brokers today and more redemptions for next week… im pretty sure of that. SP back to 1998 levels… people are going to want the money they put in from 1990-1998 back.
On the ES – We are back in the almighty blue channel. The lower trendline of my black channel inside the blue channel acted as resistance and we have formed a new channel. Bottom trendline is from the low at the end of the day on 11/18 to the low yesterday, and the top of the channel runs from the high on 11/19 at 9:30 to the high yesterday at 12:30. I’ll be watching this closely. A bounce off the almighty blue channel would be at 745. Let’s look for it.
The VIX 1m is hopefully setting up a bear flag indicating further weakness. It is a small rising wedge that should indicate further weakness. MACD and RSI indicate a turn as well.
I got back into EEV this AM when the market was up earlier. I agree with Craig it seems like a bounce is due but given it’s Friday and given no news to initiate the bounce EEV makes sense (so far today). You know what hit me coming out of the G20 meeting? Cnn, MSNBC and FOX heads stating in an almost casual note that the USA is losing super-power status. Nothing many of us do not know but a little sobering coming from the cheerleading mainstream media.
Intraday double bottom ?
November 21st, 2008 at 10:13 am
Yes.
So what’s the deal with FAS? Down less than UYG.
November 21st, 2008 at 10:25 am
And what’s up with the Russell2k getting killed while the other indices are up at least a little bit.
November 21st, 2008 at 10:25 am
I know the R2K reacts more than the others, but this is rather drastic even for them.
My ES chart has so many lines on it I feel like an air traffic controller. Stuff going everywhere.
I don’t feel good about today. I’m not sure the buyers are in the market. I’m not saying crash, but maybe consolidate here.
Artic, I agree with you. Just can’t buy citi. Might as well put it on red or black.
November 21st, 2008 at 10:29 am
I am not touching it, learned my lesson with WM
November 21st, 2008 at 10:32 am
I would buy it if goes under 2$.
November 21st, 2008 at 10:32 am
I choose to play it via FAS , in @ 13.96. Gonna use a tight stop but my feel is the market is gonna decouple from C today.
November 21st, 2008 at 10:37 am
One of my worst trades that I got chased out of that I regret the most. I had been shorting C down from around 18 or so, covered after their earnings and bought $10 puts for an average of .50. I got scared out of the position earlier this month for a small profit of around .70.
The $10 puts are now selling for over $6
November 21st, 2008 at 10:38 am
I may be wrong C still seems to be a leading indicator.
Shanky, do you have an updated pic of your channel, perchance? That thing has been gold so far!
(thank you!)
gold is screaming could it b another form of a flight to saftey
I’ve covered most of my shorts…only a few puts left for longer term play.
Bounce is coming…stock market is going to have a few “good” days next week for Happy Thanksgiving.
November 21st, 2008 at 10:58 am
Or next week will be known in the history books as “The Turkey Crash of 2008″
I bought UYG yesterday at the close for 3.77. Not sure what to do now. Probably just gonna hang on. starting to think SKF could hit 375-400 in the near term which would cut me in half. Rally………..one time!
i don’t see much volume…i think it’s going to retest support again…
flare!
Possible double bottom from yesterday?
No volume on the up moves.
VIX needs to turn here. The rising wedge turned into a larger formation. the trend for the VIX to fall has been for it go go up out of the rising wedge and then fall. Let’s hope that continues. ES testing bottom.
Is there a problem with Idan comments?
Mohan, are you seeing rally here w/ bond yields turning up?
BTW, hey, Craig.
I think actually wearing a hat inside out right now would be appropriate. We have to get a rally started somehow.
reaching 1st support level
November 21st, 2008 at 11:08 am
When is the bounce, 1 pm? There is something fundamentally wrong with this angle of slope during the last three days..
November 21st, 2008 at 11:13 am
my kudo to Gannfann.
lets see if the ol’ mighty blue channel holds here
November 21st, 2008 at 11:11 am
Putting a tail under it. Looking at the VIX – I think we’re getting ready to run down the bottom trendline.
November 21st, 2008 at 11:11 am
Call it a long test – I hope.
November 21st, 2008 at 11:20 am
So if there is not a major rally today, all the put sellers will have a lot of stock dumped on them that will need to be sold Monday….much like what happened yesterday during the last hour
Bullish MACD cross
November 21st, 2008 at 11:44 am
what time? speed?
November 21st, 2008 at 11:23 am
9:40
Good technical analysis video: S+P
http://www.cnbc.com/id/15840232?video=935477906&play=1
Could QID be a good entry on a pull back around 96 to 94 range as markets will rally than pull back.
ES 30m – if it holds – could be putting in a small bottoming candle thru the almighty.
Tom, are u still out there?
What do you think of QID? when do you think good entry point today. Entry with stop loss points would be helpful.
right shoulder may form on inverted hs
November 21st, 2008 at 11:51 am
I’m watching that as well
November 21st, 2008 at 11:53 am
nice, it would shoot to 780 (without a calculator) approx.
November 21st, 2008 at 11:57 am
I’m in on the turn at 8:58. Looser stops as we climb…