Pages

Tuesday, November 16, 2010

D- Day

Well, we are here right at a particular juncture in time that is very important according to what I'm trying to learn about equity markets.

The development of the past week reminds me when I was talking to someone in December 2008 and the situation about the markets was common chatter erverywhere and I mentioned very very casually that by end of March probably things could start going upwards.As you know, spring coming...

Of course he didn't have a clue about what my reasons were, if any.He seems to have had a good memory because almost one year later I met him in a social gathering and he clearly reminded me that previous conversation, I didn't have anything to add so everything ended there.

But what I remember not mentioning to him in the original conversation was my tentative time for an end of the uptrend or a correction; was after the first week of June 2009.

I didn't mention it as to not make evident in what kind of stuff I was into, but specifically because I was struggling to determine if really was going to happen.

My first "ideas" about what the market can do came in May 2008 when I was readying to dip a toe in the markets, what I saw scare the hell out of me.

It wasn't precise, it took several months to start crashing but the information in thre rough was there, only that I couldn't tell when.So when was going to happen was the challenge.

March 29-April 5 2009 was my first target about timming, I was off by almost a month.So nothing to right home about.

The June 09 blip was the first time that I get close, but I didn't realize until several weeks after the fact watching and watching the s&p chart that I was really close.To me it was another failure because it wasn't any meaningfull correction.

But studying more cases I realize that is more common than I expected first and came to the realization that this is really a clash among Titans, forces pulling in every direction so the June correction was there even though I didn't see it, only that it neutralized itself in almost it's entirety.

The first law of thermodynamics says that energy can be transformed from one form to another but not destroyed.Something with negative value changing to positive and viceversa without living too much of a trace is the image that I got out of it.

Astrology helps me to see IF it happens, when that probably would be, But doesn't guaranteed me the movement percentagewise just the rudiments of timming, in other words if it's going to happen when that will be, but not how much.

So that shit is what happened in june 09 something that loomed large ended being almost nothing.
Yes you know where I'm going, the correction is here, but it doesn't means that is going to be fireworks.


The clash started yesterday and the last skirmishes are going to be Thursday night early Friday.

Is it going to correct? Maybe,but by the look of things downward forces are not getting strengh as of now, there's not impulsiveness.

Is it going to crash? No, no way(from my limited and fallible knowledge).

The most probable outcome?

That it corrects 2 or 3 percent more,(if fails to pick up steam in the next 24 hours) and the correction that I imagined two months ago gets vaporized without causing too much of a disruption in Bernanke plans.

If I short I would be very alert just to avoid getting crushed.

Rock by Saturday I will have several of the stocks info and I will post it in the comments section.

Good luck everybody.


Dan



90 comments:

  1. Are the markets going to be kind to the GM IPO being priced tomorrow and begin trading on Thursday?

    Can't imagine that they want to try and sell and support GM into a crashing market.

    ReplyDelete
  2. Lurker Curious about commentNovember 16, 2010 at 8:41 AM

    "Please, spare me the condescending lecture on the DLC, I have been involved in political discussions for longer than you have been alive."

    Later, there was discussion (and agreement) between yourself an Thor, about Obama (I'm paraphrasing here), being the weakest President in the last 50 years.

    I'm curious, Did both of you vote for Obama, or did you donate to or volunteer for his election campaign?

    If so, it seems you were a little hoodwinked with regards to that judgement (as admitted by yourselves).

    So please explain to me why anyone should believe any of your rationale when talking about political discussion credentials (or markets - for that matter).

    ReplyDelete
  3. @Dss

    I agree. I think the plunger team has to operate differently now because the SEC is watching, but I'm sure there are still ways.

    @Dastro:

    Thanks. I would love to know more about the Astrology aspect. A guy named Cooper posts on Minyanville, and uses dates and some other square of nines stuff I don't understand, and he seems to make sense of it, so I'm sure something's there, I just haven't been able to figure out what. I asked him a question once, and got a very rude answer from one of his people, so I don't do that anymore. Anyway, there may be something to this astrology stuff.

    The weekly chart shows "the bird", which is oftentimes a signature of what is to come. But the volume in the SPY and in some other big market cap tells isn't there for me to think the commitment by big money to let the market down is there.

    I do think some shorts may be appropriate at this time. Yesterday, I posted maybe GOOG is one. And of course, my perennial X short is coming up, I will be looking for some lower highs when it starts to hit 49.90.

    But with small volume, I think a correction will be short-lived because the money in the sidelines will come out and buy the dip.

    ReplyDelete
  4. Rock-

    "Anyway, there may be something to this astrology stuff."

    Hmmm. Astrologers will tell you things about the effects of the planet Pluto.

    But Pluto, after many years, has been delisted with reagrds to being considered a planet. It's not a planet after all.

    How does that effect astrological forecasts?

    ReplyDelete
  5. @Rock,

    Cooper uses the Square of Nine chart popularized by W.D.Gann.

    W. D. Gann's Square of Nine

    It is not that complicated to figure out once you get the hang of it, and I know the Jeff Cooper uses it extensively in his forecasts.

    ReplyDelete
  6. @Dastro,

    Thanks for your perspective on the market. Everyone has one. I like to hear other people's opinions and am not threatned by them if they don't jive with mine.

    I Can

    ReplyDelete
  7. Morning everyone! Great post Dastro!

    ReplyDelete
  8. GM raises stock price range due to investor demand

    DETROIT (AP) -- A confident General Motors has added 20 million shares of preferred stock to its initial public offering, and it raised the estimated price range for common shares by about 14 percent to $32 to $33.

    ReplyDelete
  9. "Shanghai Plunges Again as China Contemplates Price Controls as Hot Money Inflows Stokes Inflation". fundmymutualfund.com

    Macro Man blog - buy Euro, short AUD.

    I Can

    ReplyDelete
  10. Denise - But Nader is telling us that this stock is unsafe at any price.

    Nyuck, nyuck, nyuck, did you get my funny? :P

    ReplyDelete
  11. Nader, I thought he was dead, too.

    ReplyDelete
  12. @Dss
    Yeah, he died in a corvair accident....

    ReplyDelete
  13. Fed is dreaming if they think they can just print money to drive down the U$D, so they can EXPORT!

    Export to China? Got be kidding. Grains maybe.

    I Can

    ReplyDelete
  14. I thought that Mutt humped him to death!

    ReplyDelete
  15. @I Can,

    They make just about everything they need, so raw materials and food is about it.

    ReplyDelete
  16. China and Solar panel prices. Look what they did to that industry. Macro-man blog

    With QE1, QE2 coming up and all that printing by Japan. The Yen and U$D are rising.

    I Can

    ReplyDelete
  17. I Can,

    Great article about solar. Thanks.

    ReplyDelete
  18. Morning all. Good post over at TBP about the so-called "wealth effect".

    ReplyDelete
  19. Here's the link:

    http://www.ritholtz.com/blog/2010/11/wealth-effect-greatly-exaggerated/comment-page-1/#comment-447963

    ReplyDelete
  20. Anon (8:57) - Pluto is a big Rock, the earth is a big rock, the sun is a big ball of gas, Jupiter is a big ball of gas.

    If you that the inverse cotangent of the mass difference detween solids (rocks) and gases as applied in a vacuum (Outer Space) and the quantum variations of dark matter gravitation and the relative difference between the earth as related to both Jupiter and the sun and then apply the electromagnetic polar vortex of Jupiter on the outer laying planets it is easy to see that all object have a direct impact on the gravitaional bulge of not only earth but all planets.

    So, whether Pluto is just a big rock that is a asteroid or a big rock that is a planet makes no difference because, even though it's effects are in fact very minimal to us here on this rock they are no the less measurable.

    I hope that helps.

    Mangy Mutt

    ReplyDelete
  21. Manny,

    Great article. The wealthy are certainly driving this economy. The are the only ones out spending freely, albeit perhaps at a lower rate than before the meltdown.

    Did anyone catch all of that Bernie Madoff household goods and clothing at auction? Who was buying that shit? Monogrammed slippers? Maybe there will be a Madoff Hall of Shame where they are going to display all of his excess.

    ReplyDelete
  22. Down 128, breaking support here is big.

    ReplyDelete
  23. Watching this now. Very good. New book by Chris Hedges about the death of liberalism. I might have to pick up this book.

    http://www.nakedcapitalism.com/2010/11/chris-hedges-death-of-the-liberal-class.html

    ReplyDelete
  24. Denise & Manny - Yes, very good article. I was listening to a piece on NPR about the preponderance of new ultra luxury hotels in Mecca of all places. Seems like the wealthy of the world, regardless of location, are doing just fine.

    ReplyDelete
  25. Fresh tick lows. This might get really ugly today.

    ReplyDelete
  26. Mutt- (10:35)

    lol. That explains the science. But I really wanted to know about the astrological implications. iow. how does it effect my: love life, luck, or other important things?

    I guess if stocks do good, then by application, my luck and love life will improve.

    That ought to get me into the inner sanctum of some blogs that discuss and dissect the wealth effect.

    The wealthy of the world are doing just fine regardless of location. I wonder what real estate around the pearly gates is going for these days?

    ReplyDelete
  27. @Anonymouse

    (Sorry for the delay....my secure link seems to be acting up tonite)

    "How does that effect astrological forecasts? "

    Beats me. I always thought Astrology was the study of the stars. I knew this girl in college who was really into astrology, and let me tell you, when the stars were right, well, maybe there is something to this astrology stuff.

    ReplyDelete
  28. Beach Ball is officially on vacation, sitting on a white sandy beach, drinking pina coladas, and downloading Beatles' music to his iPhone.

    ReplyDelete
  29. @Mutt

    Yeah! Thanks! Gotta love big rocks!

    Did you see the buy they put on Dad on Friday? 1.35 billion!!!

    You go, dad! You REALLY rock!

    ReplyDelete
  30. Don't everyone all try to leave at once now! Question is, will we get a little buying into year-end as was my original thesis after this dip?

    ReplyDelete
  31. @Rock (11:15)

    College girls, stars were right.

    You've made a believer out me right there!

    ReplyDelete
  32. Manny,

    Since we have broken through initial support we can go from 1180ish to the next stop, 1160. Not sure if there will be buying into year end.

    From a technical perspective, I would say no, but the markets have not been driven by the technicals for a long time.

    Anything can happen so I try to keep an open mind and formulate reaction to both up and down from here.

    ReplyDelete
  33. For the Love of CvienneNovember 16, 2010 at 11:38 AM

    Cvienne - Beyond the science and to how it impacts people(Who they are and how they are), hmmm all we can do is make a SWAG - Scieticific Wild Ass Guess - Lets say you ate a large bowl of pasta, with parmsan cheeze and a glass of red wine. However the pasta was made with extra salt and the wine has sulfates in it and well the cheeze is mostly fat.

    So because of the salt and salfates your body retains extra water, not a lot, lets say an extra quart.

    Now I am guessing you are about 185lbs, but the quart of water would add about 1% to your over all body mass again not that much, but your body would have a more difficult time matabolizing the fats from the cheeze which would then make you hypoglucimic. Plus the sodium would make you more sensitive to gravtiational pull, espcially if we were in a low lunar cycle.

    This would/could impact your overall body.

    Now I do not mean you specicfically, but because you are fit and take care of your body, you are a good example as you (or someone of simular health) would feel the impacts much more readily then someone in ill(er) health.

    So let's say you eat that right before you go to the gym, you still WANT to work out, but are feeling lathargic so don't give it your all. However there is a cute young thing staring at you, but because you are not in the mood, you decide - I will go home and watch MNF cuz the Eagles and Redskins are playing and it should be a GREAT game (Add laugher here...)

    Well, what you ate and how the sun and moons gravitational pull effected your body, there by effected your deciscion to watch a blow out of a game instead of going with a cute young thing.

    There by effecting your love :)

    Mangy Mutt

    ReplyDelete
  34. To each his own with whatever trading style and tools work for you. I've come a long way with this over the last year and a half.

    ReplyDelete
  35. Rock - I was thinking of you when I wrote that, I was just not sure how to incorperate you into it.

    But since you are a rock and we are on a rock and pluto is a rock - You Rock...

    Mutt

    ReplyDelete
  36. @Mutt

    "Lets say you ate a large bowl of pasta, with parmsan cheeze and a glass of red wine."

    ---

    Let's just say I ate a large bowl of pasta (which I often do)... but I had it with GREEN CHEESE (what the moon is made of)... and THAT's what had an effect on my mood...

    It may have made me RED with anger, and made me want to W(H)INE...

    At that point, we'd have pretty much covered all "bases"...

    Expect, of course the unexplained "bases" that can never be defined by science... the same ones that cannot explain why a mysterious "PING" that resonated from the moon on the Apollo landings...

    I pretty much think that when CV gets a knock on the noggin, the same frequency PING is heard (by dogs only, of course, especially Mangy Mutts)... :-)

    ReplyDelete
  37. I wonder if hobo is still buying over at TBP?

    ReplyDelete
  38. @dss:

    The ol' alka-selzer commercial comes to mind: "down down down the stomach through, round round round the system too...."

    If I look at the percentage of stocks above their 50 day moving average on a 3LB chart, we have a clear trend down established. The last time we had this clear trend was in April.

    Mannwich and I may be wrong. We may be in a spike down, but this trend seems to stop when around 25% of the stocks are above their 50 day moving average.

    BTW, I was the one who bought the monogrammed slippers. I only wear slippers when I go to the lavatory, where I thought Bernie's initials were appropriate.

    ReplyDelete
  39. @Dastro,

    You said, Nov. 17. Just off by one day. So not bad!

    I Can

    ReplyDelete
  40. I wonder how many folks have the balls to be very short these days? Look at it go!

    ReplyDelete
  41. Hobo effect in full force.

    ReplyDelete
  42. Yes Dastro - That's the first time that I can remember in a long time that anyone on a blog actually say a day would be D-day and it actually was. Very good call my friend!

    ReplyDelete
  43. Yeah thumbs up Dan.And thanks for the article. reThor:It takes ball indeed. Not sure it's cautious either. But then maybe it's the "hobo" side of me speaking here..

    ReplyDelete
  44. I don't know the history of DH, has he been a good contrary indicator before now?

    ReplyDelete
  45. And Dan made the call last week, November 9th, if not before as well.

    ReplyDelete
  46. @Denise: He was in '08 when the shit was hitting the fan. Was still pooh-poohing the idea of the crisis and its effects. And now he's buying. You make the call.

    ReplyDelete
  47. How can a trading desk make money everyday, for 90 days. I am referring to that news where BAC and another bank's trading desk made money everyday last quarter. Unless, you are the market maker, and got US Fed's free money to play around.

    I Can

    ReplyDelete
  48. Wolfie - hahahaha - re: Hobo Effect!

    ReplyDelete
  49. :p.
    BTW, Long time not seen any update from BR about his outlook on the markets. He shall show up soon I guess, since things are moving.

    ReplyDelete
  50. Rock,

    I just got your gmail. Sorry! If I don't respond right away just tell me here in the comments that there is gmail.

    ReplyDelete
  51. Rock - Also, if you ever have anything you want to post, just let Denise or I know and you can have one of our days (Wednesday or Thursday).

    ReplyDelete
  52. Emmy,

    Are you planning on resuming your Friday link fest this week?

    ReplyDelete
  53. @I Can: There was one quarter earlier this year or maybe it was '09 where all, or most of, the big banks made money EVERY single day of the quarter. All of them.

    ReplyDelete
  54. @Dss

    It's ok, can be done anytime. Not nearly so timely as Dastro's posts.

    BTW, everybody, it is November 17. Here.

    ReplyDelete
  55. Rock,

    You may post it tomorrow if you wish. Thanks!

    ReplyDelete
  56. @dss

    I can do it next week.

    (damned work)

    ReplyDelete
  57. @emmy,

    No problem. I'll take Friday.

    ReplyDelete
  58. Escalator up. Elevator down? Lather, rinse, repeat?

    ReplyDelete
  59. @Dss

    OK, I'll put it up after I have my midday meld tomorrow, around 1AM NY time. This "fall behind" time makes it really difficult over here.

    Oh, yes, Thor, I'm going to be out of my shorts before the session's over. Take a look at our pullbacks, how choppy they are. The rise is just a smooooooth slope, but the bumps and bangs on the way down are astonishing.

    And no, Dss, I don't have any of Bernie's shorts.

    ReplyDelete
  60. Rock,

    There is a feature that allows you to have the post run at the time you designate, hours, days or even weeks in advance. Click on the "post options" link in the lower left hand corner when you have finished typing.

    ReplyDelete
  61. FYI - I picked correctly not a big move, but I am up over 5% on the day, which is going to put a couple pennies in my pocket - Heck I might even have enuff to by a happy meal after today.

    Mangy Mutt

    ReplyDelete
  62. Congrats, Mutt! 5% is a great day.

    ReplyDelete
  63. I also thought this was very good, from Michael Hudson. Wow, pulls no punches on the O man, at all.

    http://www.creditwritedowns.com/2010/11/mr-obamas-most-recent-2-sellout-is-his-worst-yet.html

    ReplyDelete
  64. Great China article over at NC today.

    Auerback: G20 Post-mortem – “Chimerica” has been a Chimera

    So much for the need for policy incrementalism, as the Chinese persistently respond today when confronted with calls for a substantial yuan revaluation! In the late 1990s, Beijing’s earlier policy of “beggar thy neighbor” might have engendered comparatively minimal disruption domestically, but it exported the economic dislocation to East Asia and Japan. The cost advantage of these devaluations, conferred on China’s exporters, significantly eroded the trade competitiveness of other East Asian and Japanese exporters. They therefore threw their collective current accounts into substantial deficit by the mid-1990s and set the stage for the Asian financial crisis of 1997 and Japan’s “lost decade.” (It also set the stage for Japan’s implementation of a zero-interest-rate policy, which ultimately provided the foundation for the so-called “yen carry trade” — another grave source of future financial instability.)

    ReplyDelete
  65. Hrmmm - What a coincidence that this showed up in more than one place on the very same day.

    http://pragcap.com/robert-shiller-debunks-stock-market-wealth-effect

    ReplyDelete
  66. @Dan,

    So if we are in a short term correction, the next move is 50dma - 1168,?

    I Can

    ReplyDelete
  67. By James B. Kelleher
    CHICAGO | Tue Nov 16, 2010 2:24pm EST
    (Reuters) - General Motors is stepping up production of its new Chevrolet Volt electric vehicle to try to meet "huge demand," a top executive said on Tuesday.

    Speaking at an event where the Volt was named Motor Trend magazine's 2011 Car of the Year, GM product chief Tom Stephens said: "If you look at where we were originally, in terms of what we thought the volume would be, we have stepped it up."


    Who would have thought? As expensive as this car is going to be, I didn't realize there was going to be this much demand for electric. Nice to see though.

    ReplyDelete
  68. This is outrageous! This is a travesty of justice. I demand fair treatment. This is another example of "the Man" trying to keep me down.

    http://www.cnn.com/2010/POLITICS/11/16/rangel.ethics.hearing/index.html?hpt=T1

    ReplyDelete
  69. Whew! Quite a Turn-around-Tuesday, eh? Wonder how far we'll pop tomorrow morning.

    Hope nobody is holding shorts overnight. I think this is an after-hours buying opportunity.

    Big volume today, Bloomberg said 92% was down volume.

    ReplyDelete
  70. @Thor: One for you.

    http://www.calculatedriskblog.com/2010/11/dataquick-socal-home-sales-off-243-from.html

    ReplyDelete
  71. I shudder to think what my house might be worth now. My mind immediately goes to the "oh, but Hollywood is gentrifying" route, but I know I've lost at least 40%.

    ReplyDelete
  72. Hahahaham - read the exchange between Curtis Faith and MBLardes, so good.

    http://www.ritholtz.com/blog/2010/11/market-whackage-open-thread-2/#comments

    ReplyDelete
  73. Oh, and of course, our old friend Harry Wanger is back as well.

    ReplyDelete
  74. Sorry I just get back to the house and read the comments.Looks like an intense day.

    About level numbers I really don't know I-Can, sometimes I can try to make a smart ass estimate based in comparable situations (even though never I get two identicals) through history.

    So when I said 2-3 percent keep it in mind as a way to get what I'm expecting for,if I'm right.

    Instead of a 30-50% crash will it means something modest like a 1-8%, 1-10% in total for the whole movement but astrology doesn't help me there, at least for now.

    Thank you to all of you, appreciate the encouragement.
    Still think that is luck for the most part.

    I mentioned in some comment that the important thing to me is the test of time.
    So if I can see in advance 20 30 movements then we will have something important (thats the good part).
    And the bad part is that I would have a stronger mortal enemy, my ego, to fight against.

    But first I have to get 20 30 s&p movements right, before bragging annoyingly.
    This is just starting.

    Rock yes Denise gave you a link I'm not too familiar with Gann but apparently he made a lot of money 100 years ago.Maybe he has a tradable system.

    I'm not prozelitising astrology at all, use something that help you control uncertainty whatever it is.

    And a little secret; my view is that I'm a tool but Bernanke is another one too.

    We are just members of the "colony" and get influenced by forces that even though we ignore doesn't make them cease to exist.We just keep dancing their tunes acknowledging it or not, like an ant colony.That's my humble opinion.
    Yes ants who dance...oh well, I better stop.

    Dan

    ReplyDelete
  75. Cognos has been back lately too with his usual schtick.

    ReplyDelete