02/12/2013 Live Update

[skittlesmds]

Re Sequester

Congress is not in session next week. That leaves 4 congressional days left in Feb (not counting this week) for them to address the sequester.

** Have to love those midnight deals **

[quientuves]

It there any place to learn about the sequester and it's process. As a foreign trader i don't know exactly what's that and what does it mean...

[Unique]

AAPL, maybe a 1 for 5 here, 475->480, 474 stop. Trading commons, bored

[TraderJoe]

It there any place to learn about the sequester and it's process. As a foreign trader i don't know exactly what's that and what does it mean...

What is the sequester?
It’s a package of automatic spending cuts that’s part of the Budget Control Act (BCA), which was passed in August 2011. The cuts, which are projected to total $1.2 trillion, are scheduled to begin in 2013 and end in 2021, evenly divided over the nine-year period. The cuts are also evenly split between defense spending — with spending on wars exempt — and discretionary domestic spending, which exempts most spending on entitlements like Social Security and Medicaid, as the Bipartisan Policy Center explains. The total cuts for 2013 will be $109 billion, according to the new White House report.
Under the BCA, the cuts were triggered to take effect beginning Jan. 1 if the supercommittee didn’t to agree to a $1.2 trillion deficit-reduction package by Nov. 23, 2011. The group failed to reach a deal, so the sequester was triggered.
Why does everyone hate the sequester so much?
Legislators don’t have any discretion with the across-the-board cuts: They are intended to hit all affected programs equally, though the cuts to individual areas will range from 7.6 percent to 9.6 percent (and 2 percent to Medicare providers). The indiscriminate pain is meant to pressure legislators into making a budget deal to avoid the cuts.
How would these cuts affect the country?
Since the details just came out, it’s not entirely clear yet. But many top defense officials have warned that the cuts will lead the military to be “hollowed out.” Democratic legislators have similarly warned about the impact on vital social programs. And defense, health care and other industries that are significantly dependent on federal spending say that major job losses will happen if the cuts end up taking effect.
At the same time, if legislators try to avoid the sequester without replacing it with real deficit reduction, the U.S. could face another credit downgrade.

[Al_Dente]

“Copper rose for the second time in three sessions on signs that an economic recovery is gaining traction as company earnings and business sentiment improve in the U.S., the world’s second-biggest user of the metal”
[bloomberg]

Can anyone post intraday london spot copper chart
We only get EOD on stockcharts

Also I didn’t realize we were #2 consumer of copper (we all know china = #1)
Also good to know that everything is now just fine in our economy

[ClarkW]

UVXY breaking out?
No position. Careful, she's a b&tch

[TraderJoe]

“Copper rose for the second time in three sessions on signs that an economic recovery is gaining traction as company earnings and business sentiment improve in the U.S., the world’s second-biggest user of the metal”
[bloomberg]

Can anyone post intraday london spot copper chart
We only get EOD on stockcharts

Also I didn’t realize we were #2 consumer of copper (we all know china = #1)
Also good to know that everything is now just fine in our economy

Try this - http://www.investing.com/commodities/real-time-futures

[taggard]

Light Long.

Composite Trend Indicator signal no change...up.

Summation Index signal is down but any edge for trading has been statistically cancelled (i.e. any shorts would have been stopped by now).
The signal may ultimately play out but now provides no edge as to when a turn comes or how much drawdown may be suffered before it comes.

This is getting dull. I think I'll go back to bed. The turn will not come until I am either unavailable or not paying attention...

best guess here? using spy options close to the money--the calls more dense than the puts. feb is an ideal period for op-ex down. the put call balance is ideal for op-ex down. yet we are grinding along. it just feels like money flows are a bit high and sellers (due to bailing last year because of the anticipated tax issues) are a bit low. eg point is that because everything is ideal down into friday--and so far that is not happening that means something in and of itself.

looking at an (monthly) spx chart i can find 3 measured move ideas that target 1575 to about 1650 (i just eye ball measured moves so these are rough) further using the monthly 20 EMA and looking for the most distance from it (so sort of functional divergence from mean) that is also 1600.

finally if you like daytrading often you are focused on the last key high--this often works on longer term charts.

i hate making predictions because i don't trading using them--so what i would say is as things stand the trend is up into that general area noted above--and the only thing that seems different than usual is a slightly higher flow of cash from someplace (maybe some from bond funds as everyone is discussing bonds). this condition has currently been overriding the usual technical indicators and models everyone uses. that is what is going on now--unless it changes and if it does we will see it.

[quientuves]

Thank you, TraderJoe!! Quite clear now...

[TraderJoe]

Thank you, TraderJoe!! Quite clear now...

[TraderGirl]

It there any place to learn about the sequester and it's process. As a foreign trader i don't know exactly what's that and what does it mean...

What is the sequester?
It’s a package of automatic spending cuts that’s part of the Budget Control Act (BCA), which was passed in August 2011. The cuts, which are projected to total $1.2 trillion, are scheduled to begin in 2013 and end in 2021, evenly divided over the nine-year period. The cuts are also evenly split between defense spending — with spending on wars exempt — and discretionary domestic spending, which exempts most spending on entitlements like Social Security and Medicaid, as the Bipartisan Policy Center explains. The total cuts for 2013 will be $109 billion, according to the new White House report.
Under the BCA, the cuts were triggered to take effect beginning Jan. 1 if the supercommittee didn’t to agree to a $1.2 trillion deficit-reduction package by Nov. 23, 2011. The group failed to reach a deal, so the sequester was triggered.
Why does everyone hate the sequester so much?
Legislators don’t have any discretion with the across-the-board cuts: They are intended to hit all affected programs equally, though the cuts to individual areas will range from 7.6 percent to 9.6 percent (and 2 percent to Medicare providers). The indiscriminate pain is meant to pressure legislators into making a budget deal to avoid the cuts.
How would these cuts affect the country?
Since the details just came out, it’s not entirely clear yet. But many top defense officials have warned that the cuts will lead the military to be “hollowed out.” Democratic legislators have similarly warned about the impact on vital social programs. And defense, health care and other industries that are significantly dependent on federal spending say that major job losses will happen if the cuts end up taking effect.
At the same time, if legislators try to avoid the sequester without replacing it with real deficit reduction, the U.S. could face another credit downgrade.

Nice TJ!!

[TraderJoe]

It there any place to learn about the sequester and it's process. As a foreign trader i don't know exactly what's that and what does it mean...

What is the sequester?
It’s a package of automatic spending cuts that’s part of the Budget Control Act (BCA), which was passed in August 2011. The cuts, which are projected to total $1.2 trillion, are scheduled to begin in 2013 and end in 2021, evenly divided over the nine-year period. The cuts are also evenly split between defense spending — with spending on wars exempt — and discretionary domestic spending, which exempts most spending on entitlements like Social Security and Medicaid, as the Bipartisan Policy Center explains. The total cuts for 2013 will be $109 billion, according to the new White House report.
Under the BCA, the cuts were triggered to take effect beginning Jan. 1 if the supercommittee didn’t to agree to a $1.2 trillion deficit-reduction package by Nov. 23, 2011. The group failed to reach a deal, so the sequester was triggered.
Why does everyone hate the sequester so much?
Legislators don’t have any discretion with the across-the-board cuts: They are intended to hit all affected programs equally, though the cuts to individual areas will range from 7.6 percent to 9.6 percent (and 2 percent to Medicare providers). The indiscriminate pain is meant to pressure legislators into making a budget deal to avoid the cuts.
How would these cuts affect the country?
Since the details just came out, it’s not entirely clear yet. But many top defense officials have warned that the cuts will lead the military to be “hollowed out.” Democratic legislators have similarly warned about the impact on vital social programs. And defense, health care and other industries that are significantly dependent on federal spending say that major job losses will happen if the cuts end up taking effect.
At the same time, if legislators try to avoid the sequester without replacing it with real deficit reduction, the U.S. could face another credit downgrade.

Nice TJ!!

Thanks but it was only copy and paste. I can't take the credit

[Al_Dente]

Long and short
Aapl is the neon green

[ps OT thanks joe for copper et al.]

[TWT]

$SPX: It can still be a wave (B)

[Out of Bounds]

Whoa. Was that a top I just saw?

[Al_Dente]

Whoa. Was that a top I just saw?

where boss?
i'm seeing a premature H&S on 5min (?)
[edit: one day intraday only]

[Mr. BachNut]

Light Long.
Composite Trend Indicator signal no change...up.
Summation Index signal is down but any edge for trading has been statistically cancelled (i.e. any shorts would have been stopped by now).
The signal may ultimately play out but now provides no edge as to when a turn comes or how much drawdown may be suffered before it comes.
This is getting dull. I think I'll go back to bed. The turn will not come until I am either unavailable or not paying attention...

thanks mr b
can u elaborate on this """(i.e. any shorts would have been stopped by now)"""

Signal arrived on 2/5 @ SPY = 151.05.
Most signals that work show progress in price or at least in other technicals within 4 days.
If not, trade is probably a fail and should be on tight stop.
Even though trade could still work, statistically better off over time with tactic to minimize loss.
This morning's pop would have busted a tight stop from yesterday. So, may still work but odds against.

For a truly patient bear with high tolerance for drawdowns, a stop of SPY 153.85 + a cushion would capture virtually all win scenarios for the current signal.
I played the signal a little when it first arrived but closed out flat on a discretionary basis when the index did not show any weakness.
The signal is counter trend and the trend has been strong. So, I am looking for some supporting evidence to trade. There will be a turn at some point.

[johnnywa]

WERE WERE ?????????????????????????????????????

[kenttown]

New indicator?

http://money.cnn.com/data/fear-and-greed/?iid=EL

[taggard]

It there any place to learn about the sequester and it's process. As a foreign trader i don't know exactly what's that and what does it mean...

What is the sequester?
It’s a package of automatic spending cuts that’s part of the Budget Control Act (BCA), which was passed in August 2011. The cuts, which are projected to total $1.2 trillion, are scheduled to begin in 2013 and end in 2021, evenly divided over the nine-year period. The cuts are also evenly split between defense spending — with spending on wars exempt — and discretionary domestic spending, which exempts most spending on entitlements like Social Security and Medicaid, as the Bipartisan Policy Center explains. The total cuts for 2013 will be $109 billion, according to the new White House report.

it helps to see this in a larger context. 2013 total take (money coming in to feds taxes etc) 2902 trillion. money spent (so money going out) 3803. money missing (debt based spending) 900 billion. in theory this year the fed could buy roughly 12x85 billion bonds or 1 trillion. in light of this 1.2 trillion spread over 9 years--so projected 109 billion negative in 2013 is not that big a deal. econ dudes like to note the "multiplier factor" which is the assumed amount of extra juice any money creates going into the economy. so if you toss in 1 dollar and it gets spent at the 7-11 and then the 7-11 guy pays the repair guy for fixing the fridge and so on this traveling money creates a larger effect (in theory on gdp) than just the money tossed in. generally money spent by the government is considered to have a fairly low multiplier like maybe 1.5 with private money being no more than 4x and maybe something like 2.5-3x.

seen in this light the cuts in theory have an effect of about 160 billion in a 16 trillion dollar economy. bottom line not all that much. the real concern should be that nobody can agree on anything. despite flaws in the process and results--and the very likely failure to one degree or another in a recession (or what used to be called the business cycle) Calf recently has provided the best model so far (amazingly to me too dude) for some sort of at least partly rational solution short term to spending and taxes. Please don't go nuts posting all the problems--i noted them. What is seriously different is that there is some relation to reality--and for the first time in 10-12 years.

bottom line so far? we have a trend at a federal level--that trend is in place--it's hard to see how 110 billion in cuts is a big deal if you assume the current trend over 9 years that would imply something like 9-15 trillion in new debt minus the savings of 1 or 8-14 trillion.

all this is rounded and general math--i don't have any position on any of it from a political stand point--and however poorly i have written this the idea is the relative values. so the shape not the exact numbers