09/29/2012 Weekend Update

[Al_Dente]

smart money is huge short. it's a new record. Something is going on.

Short interest RECORD HIGHS are usually followed by epic squeezes.
Zerohedge usually posts the total NYSE short interest stats with custom charts, but I don’t find them addressing the si this month.
If anyone has more stats on si, please post.
[FYI: the last time si was at record highs was last October 2011 when shorts were approximately 16-17 billion shares total short on the NYSE.
The monster squeezes of Q4, 2011 immediately followed]

[edit: the record hi previous to that was about 16 billion NYSE shares short, March and April of 2009. We all know what happened then !]

[Mr. BachNut]

Here is another sign that a top or high of some kind is close (perhaps in).
The 4 week moving average of SKEW (blue line) has reached high levels (i.e. smart money is buying crash insurance with options).
This is consistent with the COT report Cobra provided.
Since 2009, when the weekly skew (thin black line) falls below a high 4 week average, a high of some kind for the SPX (thick black line) has been in place or occurred within a week or two.
I have circled these instances.
The failures (in diamonds) appeared to occur when the trend was strong and uninterrupted. As last week was a down week, the upcoming signal may be less likely to fail.
Note the this weeks number hasn't pierced the average yet but it appears to be on its way. Maybe this week.

[Mr. BachNut]

smart money is huge short. it's a new record. Something is going on.

Short interest RECORD HIGHS are usually followed by epic squeezes.
Zerohedge usually posts the total NYSE short interest stats with custom charts, but I don’t find them addressing the si this month.
If anyone has more stats on si, please post.
[FYI: the last time si was at record highs was last October 2011 when shorts were approximately 16-17 billion shares total short on the NYSE.
The monster squeezes of Q4, 2011 immediately followed]

[edit: the record hi previous to that was about 16 billion NYSE shares short, March and April of 2009. We all know what happened then !]

Commercial Hedgers are different though. These big shorts on Cobra's chart are futures positions held by the big banks, like Goldman Sachs...
They are usually the sqeezors not the squeezies (like me ).
I am with Cobra and suspicious that "something is going on."
Ben is moved to do QE to infinity and the commercial hedgers have extreme shorts on, and yet the market is near highs with no acute crisis.
One has to wonder what may be going on behind the curtain.

[ZimZeb]

[Al_Dente]

While SPX and the Dow are busy back-testing their April highs, $RUT is failing at a long term triple top, drawn from its 2007 highs
(I’m just eyeballing… best double check the numbers)
Bulkowski here on triple tops: http://thepatternsite.com/tt.html

[TRAN is still on a “Dow Theory” Bear Market signal, from back in April/May this year.

[daytradingES]

Here's an update on an earlier post. I wrote about the 3 sections of a bull campaign and it looks like we are about done (13 Sep). On Friday 14 Sept we hit the high 1474 in the SPX.

Bad Bennie gave QE -- infinity of $40-$80B of MBA per month. (Thurs 13 Sep ?).
I posted to Pets that it was good for a few days to a week and will it would chug along sideways and then it would be Ok (meaning safe) for his short (it started to fall Monday the 24th).

- though being the sharp-shooter he is I think it nailed the Friday high, which is looking to be a multiyear high. - good trade Pets!

So if free money is great for the market it should have gone up since the announcement - but it has fallen after Friday's 1 day follow-through.

In looking at the chart once/IF
1422 is broken on a weekly close by a few points - so say a Friday close of 1415 or less,
the bears can start to have a tasty treat!

(Wednesday's low 1430.53 - so not too far away!!)

-- I wouldn't go too heavy, yet. The manipulators are allowed to buy and push up the market anytime they want !!--
with 2 separate acts of congress. So sharp retracements are to be expected.

[daytradingES]

Thanks Al,

I haven't used the $RUT before.

I tried fooling around with it on stockcharts - the annotate seems to have a tiny box - probably to discourage freeloaders like me!! LOL

[KeiZai]

Here is my next week plan

june cycle ended that´s for sure and we need to correct it (on 20th September)

Don´t worry I will change my avatar back, just need to celebrate my team won (finally!)

YNWA
http://www.youtube.com/watch?v=Wr79KF6r ... re=related

[Cobra]

Weekly stocks scan.
viewtopic.php?f=10&t=687&p=97488#p97488

[ClarkW]

Forgot who but somebody last week or beginning of this week (yes I'm lazy) mentioned VELT. KeiZai? Anyway, the daily looks interesting to me.
NOT A RECOMMENDATION

[Al_Dente]

TSM is bucking the semis trend

[ClarkW]

Latest short interest report
Note: NUGT short interest increased by 244%
TZA shorts increased by 54%
etc
http://online.wsj.com/mdc/public/page/2 ... tml#shortD

Oddball note: it appears they are using boring TIPS, probably as an inflation play (?)...Shorts in TIP decreased by 41%

Hey Al, do you interpret a huge increase in short positions as bullish or bearish? Not holding anything against you but I would think large short ratio is actually bullish but when there's a quick increase don't know how I would think of it....

[ClarkW]

FOR FUN, not starting a political discussion but if Obama is re-elected what companies will benefit? Maybe Ruger or Smith & Wesson? Or Cabelas? They've all been on nice runs, can it continue?

[ClarkW]

Still holding PGJ for a play on China. Hoping the Bearish Harmonics pattern on $SSEC weekly plays out. Looks like a nice Inverse H&S on PGJ Daily....
NOT A RECOMMENDATION

[Al_Dente]

Latest short interest report
Note: NUGT short interest increased by 244%
TZA shorts increased by 54%
etc
http://online.wsj.com/mdc/public/page/2 ... tml#shortD
Oddball note: it appears they are using boring TIPS, probably as an inflation play (?)...Shorts in TIP decreased by 41%

Hey Al, do you interpret a huge increase in short positions as bullish or bearish? Not holding anything against you but I would think large short ratio is actually bullish but when there's a quick increase don't know how I would think of it....

yes huge increase in short interest = bullish

[knock]

Latest short interest report
Note: NUGT short interest increased by 244%
TZA shorts increased by 54%
etc
http://online.wsj.com/mdc/public/page/2 ... tml#shortD
Oddball note: it appears they are using boring TIPS, probably as an inflation play (?)...Shorts in TIP decreased by 41%

Hey Al, do you interpret a huge increase in short positions as bullish or bearish? Not holding anything against you but I would think large short ratio is actually bullish but when there's a quick increase don't know how I would think of it....

yes huge increase in short interest = bullish

increased short on TZA right?

[Cobra]

3 additional things I do after found bunch of stocks I'm interested in.
viewtopic.php?f=10&t=687&p=97501#p97501

[Cobra]

A little FA table for the stocks chosen this week.
viewtopic.php?f=10&t=687&p=97503#p97503

[Mr. BachNut]

Latest short interest report
Note: NUGT short interest increased by 244%
TZA shorts increased by 54%
etc
http://online.wsj.com/mdc/public/page/2 ... tml#shortD
Oddball note: it appears they are using boring TIPS, probably as an inflation play (?)...Shorts in TIP decreased by 41%

Hey Al, do you interpret a huge increase in short positions as bullish or bearish? Not holding anything against you but I would think large short ratio is actually bullish but when there's a quick increase don't know how I would think of it....

yes huge increase in short interest = bullish

increased short on TZA right?

This chain is a little confusing.
If increasing short interest is a contrary indicator, then increasing shorts in TZA indicate that TZA would rise in a squeeze.
However, as TZA is a levered Bear etf. So, bullish TZA is bearish market in general.
So, do you read the increase in TZA shorts as market bullish or bearish?

[uempel]

I'm in the dark as to next week. Presumably markets will be volatile, but that's all I know...