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03
Dec
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4.02pm
Insane rally towards the end of the day, we broke the 61.8% retracement but haven’t really confirmed it. On a first look, I do believe that a gap lower is in works for tomorrow, but we’ll have to analyze the charts more thoroughly before putting big short positions on.
3:43pm
I’m playing SDS right now, with a stop a little above 880.
3:33pm
Will the market close above or below it’s 50% retracement of 86$? on SPY.
3:02pm
Head and shoulders on the ES, with ascending neckline at $840 ish .
2:24pm
Late afternoon rally staging here. Today is another possible consolidation day, and we have to see how far up this can go, before putting on big positions.
12:57pm
Market failed to confirm a break of the 50% retracement at 86$, we’ll have to maybe consolidate up, and then break.
12:37pm
The 61.8% retracement served as resistance, we’re now heading back up, we could be seeing a head and shoulders formation on the SPY. I will get short if we get close to 61.8%, with a tight stop around 87.65$.
VIX is not up as much as in the morning.
I haye to say it, I’m not a prophet, I’m just really good. Here is my quote from earlier for those of you that don’t remember.
Shanky “Mr. LONG (is gone)” commented:
December 3rd, 2008 at 11:46 am
I think that is it for ES today. 866 and a LT trendline as resistance should be enough to turn. I expect consolidation during lunch. I do not think this will be a bull flag, but a rollover. The falling LT trendline will make this look like a bull flag.
Mav – I am the man!
Comments welcome – I am an open target. But you gotta admit it was a near perfect call.
December 3rd, 2008 at 1:50 pm
Good call Mr. Prophet… so, what’s your call for where we close? Care to go double or nothing?
December 3rd, 2008 at 1:52 pm
Good call, Shanky. 865 was 61.8% retracement (816-896).
BTW, what LT trendline are you referring to? I don’t see it. TIA.
December 3rd, 2008 at 1:58 pm
Good one shanky. hats off.
December 3rd, 2008 at 2:00 pm
Daily ES start at the top of 9/30 and draw it across the top of 11/05 and bam. I drew it yesterday and it worked nicely this AM.
December 3rd, 2008 at 2:07 pm
i would expect a rise back to around the 848 range we’ve been testing the last two days, then we might see another drop.
December 3rd, 2008 at 2:00 pm
Bond yeilds lost their trendline at 1pm and then VWAP fell, and then timber. Bonds yeilds have a triple bottom now. Still we are well above ES Support which has yet to be tested.
I reloaded LONG.
December 3rd, 2008 at 2:01 pm
Shanky,
I am like you. I knew that I never make a wrong call. The one time I called it wrong, that’s when I thought I called it wrong, when in fact I called it right! Trust me, it was a very humbling experience.
Other than that, I am just too good.
December 3rd, 2008 at 2:04 pm
Oh.. I forgot to add…
When are you going to ask yourself to marry you?
December 3rd, 2008 at 2:06 pm
Ha! I hope you all know that I am just having some fun. Lighten things up a little. I’ve been wrong before and will be again. Charts led me to this one.
December 3rd, 2008 at 2:08 pm
Of course I know you are having fun…
I am just pulling your legs to ease some trading related stress here.
VIX is slowly creeping up
Idan, I’m sure you’re busy, but would appreciate a bit more input if possible. What, e.g., are you thinking is happening right now? Consolidation for further downside? The opposite? TIA.
December 3rd, 2008 at 1:58 pm
BTW, great call on the reversal at the 2nd hit of 61.8%. Another miss for me.
December 3rd, 2008 at 2:03 pm
I’m thinking consolidate till later and at least test the lows.
832 to 826 will support. Bulls are not out of this yet. We might get into a tight trading range for a day or two and consolidate as we may be in a larger symetrical triangle. If we break 826 the bears will take over, but I’m not sure I see it happening. VIX is in a triange as well. Could get pretty dull unless some news comes to really move the market.
December 3rd, 2008 at 2:02 pm
Beige Book maybe?
December 3rd, 2008 at 2:08 pm
Helped it down a little, but everything is priced in. got to get some good unexpected news.
December 3rd, 2008 at 2:26 pm
this is too funny…. everything is going to hell and we all know it. there is no fix short or mid term and we need news to move the market lower? clearly, the human race has been dumbed down. if this market rallies with the government taking over everything ill be blown away and forced to live in the bush and not talk to anyone anymore. can anyone read a balance sheet? ive read many lately and most REITS for example smell of Enron type accounting. 5 series of debt and falling asset values and mounting losses. dont they owe the banks money? how are the banks ever going to get out of this mess? they simply cant do it without being nationalized. if they are all nationalized how is the US government ever going to stop printing money? this is bigger than the great depression. this is insanity! if this does not lead to crazy social unrest and more wars ill be suprised.
December 3rd, 2008 at 2:36 pm
Dude – gotta have a war. that’s a given.
December 3rd, 2008 at 2:53 pm
I agree with you on that one! I think we went into IRAQ a little too early
Now that I think of it. Inid and Pakistan me trigger it but I hope not! Millions of innocent people will get wasted…there are no winners in a nuclear war!
Basic Materials & Energy lead the way down. Also EEM, very weak. Also, the European markets closed down today, as if anticipating a downturn in the U.S.
Stopped out of my SKF @ 150.58
December 3rd, 2008 at 2:11 pm
Nice trading today AF.
December 3rd, 2008 at 2:16 pm
ty , I’m back in UYG @5.00 now.
this will be the 4th attempt to hit resistence if we rally from here , rule of 4 should provide a breakout.
Kidding aside…
Shanky, are you short or long now?
December 3rd, 2008 at 2:19 pm
Short a little. Waiting on confirmation of direction.
i’m setting my sights for 848 and going short from there…into tomorrow.
but i could be wrong haha.
December 3rd, 2008 at 2:18 pm
I am doing the same…. I am waiting to hit the 20MA on the 10 minute chart that Idan always talks about. Then I will short and put my stop above it. Its around 847
woo, if I read you correctly, you see us in an intraday wave 4 of the 1st wave down of a 5 wave structure taking us to ??? (where?).
How can anyone be buying this market with California basically bankrupt?
December 3rd, 2008 at 2:30 pm
Why only California, America is almost there.
What would you say if I said we might break today’s highs by EOD? My indicators have a great bullish setup.
December 3rd, 2008 at 2:21 pm
That would be great Mr. Christmas Rally. It is possible, but I think we’re going to consolidate in a triange for a day or two.
December 3rd, 2008 at 2:24 pm
The buying volume on SPY is far above the sell off volume.
December 3rd, 2008 at 2:21 pm
aicarumba!
i eat my pants and lose some money, some internet money!
December 3rd, 2008 at 2:22 pm
i would say it’s VERY possible. the way i’m looking at the charts, if what we’re on is a 5 wave down, we’re headed a lot lower. if it’s a 3 wave, then we’ve got a 5 wave up coming, that could take us above the previous highs, it would also form a cup and handle in the process.
i’m watching very closely. today is clutch. i would bet too much either way, just yet.
Can someone tell me how to look at bond yields on yahoo or thinkorswim. What symbol do I need to enter?
December 3rd, 2008 at 2:21 pm
FVX, TNX and TYX, for the 5-, 10- and 30-year notes respectively.
Bill Miller of Legg Mason has called the bottom is in – WHAT AN IDIOT!
December 3rd, 2008 at 2:24 pm
Surprised he has any talking privileges at this point. Was the man for a long time, but really missed this market since ‘07 and another example of how failing to adapt can be fatal to your shareholders.
“Countrywide’s long term business value… we think is in the $40’s compared to its current price of about $14-15.” — Bill Miller 11/07
I won’t give you his quotes on FRE, FNM, and the homebuilders all of which he kept gobbling up on the way down.
Volume picking up in BAC to the upside. Carefull with your shorts already approaching resistence for the 4th time.
looks like SPX want to touch 847 before 14:30
ES on the move up breaking out of 1m channel. Let’s see if it confirms.
December 3rd, 2008 at 2:26 pm
B U L L I S H V O L U M E
December 3rd, 2008 at 2:32 pm
certainly on SPY! highest of the day. Need to see how the bonds close
December 3rd, 2008 at 2:33 pm
Easy big boy. Easy. The ES 1h cangles are large both ways, but the bull volume is there. That was a nice shutdown of the bull move, but all good things must come to an end near 862 then 866.
December 3rd, 2008 at 2:28 pm
Guess you can call that move confirmed. Flare, flare, flare LOL HA.
December 3rd, 2008 at 2:29 pm
And check out that nice UP channel that has formed over 2 days. Oh Mama!
December 3rd, 2008 at 2:33 pm
so where does it stop if it heads higher? the market has been forming 535 bull intradays and forming uptrends into today. i guess it really could be a correction. hats off to you.
gotta give to the bulls. What a fight at the 840 line. Shanky is correct we need some more bearish news to move market down.
Cant tell jack which way it would go
if your not bullish yet i dont know what to tell ya look at the inverted hs about to form
December 3rd, 2008 at 2:37 pm
Huge, but still I just can’t do it.
Continuing on yesterday’s discussion of hedge funds, here is an article from yesterday’s WSJ regarding 36% of the investors in JPM’s Highbridge Capital Management fund wanting to redeem their shares. Talks about contraction in the fund’s worth from 15b to 6b. Also discusses Paul Jones’ fund halting redemptions in its 10b fund.
http://online.wsj.com/article/SB122818726575871543.html
BAC 5m chat fighting 2 day resistence line. Volume still healthy to the upside.
Oil hardly moving on this upswing.
December 3rd, 2008 at 2:39 pm
ive been shorting oil from $106 level. oil tells the true story of the economy. the splie500 is so overmanipulated that no one knows where its true direction is even though fundamentals tell us it should be following oils lead.
December 3rd, 2008 at 2:41 pm
oil has closed
Mohan – there is your cup – it’s pretty – now you need a handle.
December 3rd, 2008 at 2:45 pm
I don’t play baseball. I did play cricket though, those cups with a strap, not a handle.
If you really look at cup-and-handle formation, it is essentially a bull flag (the hands is the flag). I think this cup and its handle will be broken. Just like the inverse H/S yesterday.
I smell ACCUMULATION.
Higher highs and higher lows …… hmmmmm
December 3rd, 2008 at 2:43 pm
Am with you mate, I think this is 1 more try the bar is now 860 or thereof. In the next few days 890. No positions yet long or short. Waiting for a breakout.
December 3rd, 2008 at 2:45 pm
I smell the VIX 1d setting up a bull cross. Easy big fella.
December 3rd, 2008 at 2:49 pm
should set up as we test the day’s high again and break out together. what a fun day.
when oil stops going up with the market thats what the bulls are waiting for
BAC pushing into resistence for 2nd time today.
handle time.
December 3rd, 2008 at 2:49 pm
Bulls have to ‘handle’ the truth if the formation is broken!
when TLT was at this level yesterday, SPX was at 820
December 3rd, 2008 at 2:55 pm
What does that mean…?
December 3rd, 2008 at 2:56 pm
Yeah – interesting. Bond yields sinking again, so the party might be over for today.
I can buy a new Ford with my gains today — perhaps a hybrid Explorer …
Woo give me a count or something – I’ve been enjoying your call of these 35358912 ew things.
did someone say this earlier – I’ll quote it “Easy big boy. Easy. The ES 1h cangles are large both ways, but the bull volume is there. That was a nice shutdown of the bull move, but all good things must come to an end near 862 then 866.”
Excuse me, but was that a turn at 862?
Ok – I’ve laid them on the chopping block.
December 3rd, 2008 at 2:57 pm
OK – I read it and I can’t type – i have no idea what a cangle it. I know what a Kringle is. Maybe I ment angle. And it was a bear move that was shut down nor bull. The Taco Bell and Mountain Dew are getting to me.
December 3rd, 2008 at 2:59 pm
I ment candles – got it.
December 3rd, 2008 at 3:07 pm
haha.
so..for what it’s worth, this could be wrong…
we’ve still got room for up intraday wise.
If this is a 5 wave up, it should go higher. this might be a 2 of a 5 wave. we’re SUPPOSED to break highs, but it might not happen today, and might happen start of day tomorrow.
1 has hit at 859, 3 at 863ish?, 5 at….??
but like i said, i could be completely wrong…
I’m just going to get flat before the final hour. Every day, the final hour is the most ridiculous free-for-all casino maniac time. Something’s fishy though as long bond rates keep going down.
Here is some food for thought while you bid up those prices for Santa Claus, while our bankers and policy wonks tell Asian crowds today their true thoughts. (Not something you see on CNBC, eh)
From Bill Roach, head of MS Asia,”There’s not a country in the [Asian] region that is not either slowing or its economy is in recession,” he told the audience of Asian bigwigs.
“The capital markets are seriously broken,” said Laura Tyson, a business professor from the University of California, Berkeley. It is impossible to assess risk or price assets, and that means investors that have fled the markets in droves are not likely to come back until they know the system works again, she added.
“Right now, I’m not brave enough to invest in financial institutions,” said Luo Jiwei, chairman of China Investment Corp. CIC has incurred big losses on US$8-billion invested last year in Morgan Stanley and private equity firm Blackstone Group. Mr. Lou criticized government policies in developed nations that are shifting too frequently for his fund to be comfortable pouring more cash into the financial sector. “Until the [policies] are clear, I don’t dare to invest in them,” he said.
And this tidbit, “Wealthy investors’ outlook dropped to a record low in November with almost half of survey respondents saying they weren’t putting more money into investments, according to a report released today by the Spectrem Group. The Spectrem Millionaire Investor Index, which tracks the investment outlook of households with at least $1 million in financial assets, dropped 15 points to minus 39, its first bearish reading. The November level marked the steepest one- month decline since the index’s inception in 2004.”
Mr. Pink likes the Dec 850 SP puts. Bad news is about to filter into the market and those puts will double prior to expiration. In at 4.30
December 3rd, 2008 at 3:03 pm
Sensational post. you should post more often.
a shooting star on SPX 15min.
December 3rd, 2008 at 3:04 pm
Glad it was not a flare!
Per Martin (post #118):
if your not bullish yet i dont know what to tell ya look at the inverted hs about to form
—
Copied and pasted comment from the Social Blog (w/ small edits):
I’m sure you must be aware of the massive potential inverse H&S beginning in early 11/08 that, if it bears out, will hit neckline around ~$SPX 889. Are you also aware, however, that this same neckline is a very strong trendline that dates back to 10/07? Pull up a 2-yr. chart and take a look. Do you seriously think that, in this current climate, we will bust through that older, but very strong trendline, and hit 1,060?
Since you like to look at weekly charts, pull up a weekly chart with a 20 and 40 EMAs. These are very good indicators for larger-market, long-trend reversals. Unless the 20 comes anywhere close to crossing over the 40, which at this point it is nowhere near to doing, the bear market is in full swing.
For this wave 4, as you see it, to bust through the old trendline/neckline to hit 1,060, short of a change in fundamentals, seems like a difficult prospect. Do you see a change in fundamentals in the next few months? I can’t (not that that should mean anything). Will the PPT, with their access to portions of the $8 trillion plus that they have availed themselves to, be able to carry this off?
To add just a bit, even the “2nd upper trendline” (which isn’t really a trendline, but was where the market was taken with the 9/08 short ban on financials), at this point would top out at about 940-950. Is your wave 4 strong enough to completely disregard these trendlines? (The “2nd upper trendline” I’m referring to would be on top of the current channel we have been running in since early 10/08, with the bottom line of that trendline having begun in 6/08.)
—
FWIW, the H of the inverse H&S has a depth of about 160 pts ($SPX), giving a target of roughly 1,050 (160 above neckline of ~890).
Is there enough impetus to push beyond the trendline from 10/07, bust through the top of the channel and the “trendline” above (financial short ban), and hit 1,050?
“But I want an Umpa Lumpa Daddy!”
I think its time for some comedy around here, this volatility can make you calloused.
December 3rd, 2008 at 3:07 pm
If you are wise you’ll listen to me. What do you get when your country’s a mess? I don’t like the look of it. Om pa loom pa dumpaty da …. I could go on but i won’t.
Here comes the selling. Action thus far in this week is similar to the action in the 1st week of September.
December 3rd, 2008 at 3:09 pm
The intra-day volatility is stunning. Simply random action the past few days. What amazes me is that so many Americans pensions and retirements are tied to this casino. Simply amazing….
well ty anything is possible in this market..what i like is interest rates under 5% gas under
$2 and the market holding 8400 and 840 but only time will tell good luck
NAS is still positive along with C.
bond yeilds closed lowered yeserday compared to monday but still we were 250+ on the DOW. Will it be repeated today?
Is it just me or everybody find these vertical 70-100 point moves up and down totally abnormal? …
December 3rd, 2008 at 3:14 pm
Random and abnormal for sure. Someone or a group are working very hard to hold this market right now.
Exactly WHAT is the market trying to TELL us with all this EXTREME volatility going on?
December 3rd, 2008 at 3:13 pm
Perhaps this is how a bottoming process looks like. I don’t know. Reminds me of the crazy volatility on USO back in July, just as oil was trying to reach 150 per barrel.
TLT just made another historical high
December 3rd, 2008 at 3:18 pm
Yet another bubble! That is bullish for equities. Bearish divergences on the hourly TLT chart says it will break fairly soon. Best be LONG equities when it does.
December 3rd, 2008 at 3:30 pm
This bubble has a long long long long way to go. Mr. P$nk is long the FED and their balance sheet via the 30 yr bond, and is short those assets the FED is not buying, mainly toxic WS banks insurers and other such stuff. While trite, it is true. Don’t fight the FED. Equity investors don’t realize yet that the FED has never represented their interests, and certainly doesn’t as this malaise unfolds.
Mr. P$nk
a flare. but with the violent oscillation, the flare may be not so meaningful.
December 3rd, 2008 at 3:13 pm
another bigger one.
December 3rd, 2008 at 3:18 pm
Toy, each 1 min segment looks like a flare.
TOS has crashed on me twice today (not “freeze” crash — I mean “wiped off the face of the earth” crash). Anyone else have any stability issues with TOS? TIA.
December 3rd, 2008 at 3:13 pm
It could entirely be my Commodore-64-like computer…
December 3rd, 2008 at 3:16 pm
i had a commodore 64 it worked great…you know you just dated youself
December 3rd, 2008 at 3:17 pm
Ty: No issues here with TOS.
December 3rd, 2008 at 3:21 pm
I had a sinclair 48
is that a nasty H+S on 1min es?
Keeerist. Which way’s this pup headed? This kid’s sidelined. Everyone gutsier than me and have a position?
December 3rd, 2008 at 3:21 pm
im 100% short short short and wish i had more money in play – failed the 50% retracement over and over…. think the bulls will simply be happy with a 1 pt up day…. time will tell
December 3rd, 2008 at 3:27 pm
100% huh. OK. No wriggle stuff there. That’s a position.
December 3rd, 2008 at 3:35 pm
Does on my knees praying for a crash count as a position?
The snozberries taste like snozberries
I looked at the last 5, 5-min candles. Min was 4 and max was 11 s&p points. UFB!
December 3rd, 2008 at 3:22 pm
Make that six 5-min candles
is my reply to 128 about to hit?
This kind of a wipsaw action simply means the bulls and the bears are fighting. I dont think this is a bottom, since the sentiment is not completely bearish. We may see another crash to the downside like in October. That is what it takes to exhaust all the sellers.
4th test of the upper limit on our triangle coming up. If it follows form, we will break up here.
December 3rd, 2008 at 3:29 pm
watch this next rally…it will be beautiful =)
December 3rd, 2008 at 3:32 pm
We just bounced off the upper line. Headed down to test the bottom @ for a 4th time. Not much room left in this thing. It’s going to breakout hard one way or another very soon.
December 3rd, 2008 at 3:35 pm
boom. there it goes out of the top. look for a bit gain into the close, unless this is a little fakeout.
December 3rd, 2008 at 3:35 pm
big gain, not bit gain…
December 3rd, 2008 at 3:38 pm
next test at the day’s high, then who knows? what was the next resistance?
like i said before, it might not finish today.
December 3rd, 2008 at 3:44 pm
big resistance on my chart @ 868 / 870, and then again at 875 (the top of the major descending trendline we’ve been in since this bear began)
accumulation or distribution?