11/15/2014 Weekend Update

[Cobra]

The institutional buying and selling chart (courtesy of stocktiming) shows accumulation is decreasing rapidly, interesting but not enough to raise red flag.

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Smart money bought a little bit but not as huge as I'd like to see to clearly signal that a pullback is due, so not much use this week.


Since there're some arguments about how to read the chart, so it's necessary for me to explain here how I use this chart:

I don't care what's the logic behind the chart. I found it works in the following two cases:

When market up huge, if I see smart money huge short, best if new record short, then I know a short-term pullback is due soon.
When market down, if I see smart money suddenly rises from very negative to very positive value, then I know the pullback was over.

So I only use this chart for the above 2 cases. Besides those 2 cases, it means nothing to me. i.e. the absolute value of this chart means nothing to me, I only care if it rises sharply or drops sharply.

[Cobra]

summary of the week's stock picks.
viewtopic.php?f=10&t=1481&p=176558#p176558

[Cobra]

preview of the next week's stock picks:
viewtopic.php?f=10&p=176562#p176562

[Al_Dente]

Big week for WHALE WATCHING:

“Guess How Much Money Bill Gross Made Last Year?”
[Spoiler Alert: he earned $290 million as his year-end bonus for 2013, and Mohamed El-Erian received $230 million.]
http://www.bloombergview.com/articles/2 ... peningBell

As it turns out, when Gross was certain that his board was going to fire him, he visited the reigning Bond King, Jeff Gundlach, “sucked up” to him and asked him for a job. Gundlach said no; Gross joined Janus. [This is a great profile of Gundlach:]
http://www.forbes.com/sites/schifrin/20 ... h-king-me/

Carl Icahn’s loss on HERTZ (HTZ) today (Friday) was $40 million (IN ONE DAY). At the intraday low, he was down as much as $123 million.
http://www.marketwatch.com/story/carl-i ... atest_news

Virgin America (VA) went public today (Friday) on the nasdaq. It opened at $27 and closed at $30 (up +30.43%). This is good news for poor Richard Branson. Forbes estimates he made $3million today.
http://www.forbes.com/profile/richard-branson/

[Al_Dente]

NAAIM equity exposure jumped to 85% (from last week’s 77).
That means the investment managers and their followers are almost “all-in” long bull.
IT CAN GO HIGHER, but this is the “top zone” (contrarian rationale = when almost everybody is “all-in” long bull, there are not too many folks left to buy)

[daytradingES]

Happy weekend
Pbar from Thursday

[daytradingES]

From the 12th (late at night so the Thursday o/n session)

Let's see....

[daytradingES]

Siendfield - no soup for you!
Swizzes - no gold for you!

[Al_Dente]

Price/Earnings Ratio the last two years: is the market saying that 19.5 P/E is too high but 18 P/E is okay?
I find it interesting that over the past two years only, the P/E has been higher, but it hasn’t been allowed to stay up there above 19.5 for much more than a month+.
Today’s P/E Ratio is 19.78 (based on “trailing” twelve months earnings). The average P/E ratio since the 1870′s has been about 15.
Another P/E measure (not shown here): Schiller’s CAPE Ratio is 26.71 (based on average inflation-adjusted earnings from the previous 10 years), compared to its historic average of 16.5.

[pezhead9000]

Weekly T2118 McClellan Summation Index with moving averages

[pezhead9000]

Economic health-o-meter: I feel fine but my friends are sick
"Conclusion:
These economies are the 3rd, 8th and 9th largest in the world. Two are experiencing stagflation while a third is building up an extremely large amount of debt relative to GDP. People have been predicting a Chinese fall for some time as a result of its debt/real estate situation. The lack of a negative development does not make these predictions less salient. And the combination of all three countries having serious problems is a very concerning development for other developed economies"
http://community.xe.com/blog/xe-market- ... russia-and

[DellGriffith]

last week was here:
viewtopic.php?f=2&t=1480&sid=eefe88e726 ... c4#p175781

[Al_Dente]

Looks like on average (the navy-blue line is the 10 moving average), fewer stocks have been advancing and more stocks have been declining this month. This is just another view of the AdvanceDecline data. If you compare this to the mid-Aug to mid-Sept data (pink boxes, with SPY in purple on the bottom panel, for comparison), you can see that this type of action EVENTUALLY leads to a SPY drop.
To state the obvious: advancing stocks are the lifeblood of an advancing market. But you can’t set your watch to this; it’s just another indication of impending weakness that can be cured if more stocks start advancing.
Daily chart

[tsf]

Bulkowski's prediction for S&P 500 index (week beginning Nov 17, 2014):

... it's my belief that we are about to retrace the gains from the October low.That means a drop to, oh, 1950, maybe 1975, and I expect it to happen next week.

[Al_Dente]

Continued:
Here’s the viewpoint from NYUD and NYAD on the daily.
“Trend followers” will often wait for a sell signal (not yet), which means they are usually late at catching the exact tops and the exact bottoms, hoping just to bag a chunk out of the middle of the trend.
This set-up is designed for short-term or swing trades, not for intraday moves.

[Al_Dente]

Final FINAL chart on the AD
This is the Art Hill set-up which he uses for confirmation/non-confirmation of SPX new highs.
I’m sure he sees the current non-confirmation of the SPXAD vs SPX, but I haven’t seen him post about it yet.

[tapesense]

On the system trading front, Trading The Odds is posting regularly again on a VXX/XIV system, with updates at market close on twitter. Some under the hood info is here http://www.tradingtheodds.com/2014/11/d ... revisited/

[uempel]

Blue ellipses and a black grid suggest tough resistance at BPSPX 69. Against these odds it's unlikely that SPX shoots higher here. Correction or sideways move in the cards.

[uempel]

Al_Dente, good stuff, thanks

[gappy]

http://slopeofhope.com/2014/11/saturday ... l#comments

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Always enjoy this guy's logic.