09/15/2012 Weekend Update

[Cobra]

Begin with institutional actions from stocktiming.

Institutional accumulation up, good. distribution at historical low, maybe bad.

Liquidity is good, so now it might means the rally is still at early stage .

[Cobra]

Smart money still huge short (means they still hold large long position).

[Cobra]

Nothing special on II and AAII because FOMC is on Thursday (after this week's survey), so the next week's data might be interesting, even I don't think this market would ever pullback anymore...

[dr659]

We will get small pullbacks, But now they will be JBTMFD.

[BullBear52x]

Thanks Cobra you navigate well, talking about know the trail and walk it too

Weekly is about that time stick or no stick is about to be seen.

see where the BB% and RSI extreme up or down

[ZimZeb]

Update on one of A_D's many children (dangled by its feet and wearing a new shirt):

Been fiddling with HighRev's cycles. Something for bulls and bears alike:

[Mr. BachNut]

Put Call ratios and divergence between OEX and others is flashing yellow to me, but it could be like January.
The OEX positioning kind of aligns with the COT commercial hedger position below.

[BullBear52x]

Update on one of A_D's many children (dangled by its feet and wearing a new shirt):

dvy091512a.png

Been fiddling with HighRev's cycles. Something for bulls and bears alike:

hrc091312djia.png

hrc091412djia.png

ZimZeb, That is nice avatar you got there.

[BullBear52x]

Put Call ratios and divergence between OEX and others is flashing yellow to me, but it could be like January.
The OEX positioning kind of aligns with the COT commercial hedger position below.

Put Call Ratios.jpg

what is your thought on MO, both NY/NAMO reading >50.?

[TradingJackal]

ECRI says we are in recession. Did Ben see it too? All this future prediction is like Hari Seldon of the Foundation.

http://www.businesscycle.com/news_event ... -there-yet

[Al_Dente]

Update on one of A_D's many children (dangled by its feet and wearing a new shirt):

dvy091512a.png

Been fiddling with HighRev's cycles. Something for bulls and bears alike:

Thanks zimzeb
Could u explain what “HighRev” is?

[noob]

Nothing special on II and AAII because FOMC is on Thursday (after this week's survey), so the next week's data might be interesting, even I don't think this market would ever pullback anymore...

Cobra, this happened in 2010 and 2011 summer, huge rally break up and just when everyone thinks market will never pull back, it does.

Will this weekend's report say I see topping signals but don't short yet?

[Al_Dente]

PAGING TradingJackal
Re: MBS mortgage backed securities
I see exactly what u mean
Since Ben's Thursday comments, MBB is up hardly a point, while spy-proxies, banks, smalls, Qs, metals, juiced and unjuiced, are all up soooo much more.
So why dick around with MBSs when there is much more MEAT in just about everything else.
Very helpful, thx

also re: your faves …this is % performance, one month

also WEEKLY: banks just this week broke out above long term resistance

[shaca]

Put Call ratios and divergence between OEX and others is flashing yellow to me, but it could be like January.
The OEX positioning kind of aligns with the COT commercial hedger position below.

Put Call Ratios.jpg

in the last month everyone has traded mainly CALL options, i think if the market will be at a top the next friday, it will be a blood bath for Market Makers, they will have to pay a lot, and who bought call option would make massive money. Market makers are not here to lose money; or maybe MM will sell massive stocks to who bought call at the top, there are many interpretations, we will see

[Petsamo]

Update on one of A_D's many children (dangled by its feet and wearing a new shirt):

dvy091512a.png

Been fiddling with HighRev's cycles. Something for bulls and bears alike:

hrc091312djia.png

hrc091412djia.png

ZimZeb, That is nice avatar you got there.

You stated yesterday you don't like talking politics.
Here's something political, yet it is relevant to trading: The Mitt Romney Factor In 2 Specific Sectors

Break

Seeking Alpha is a bunch of clowns. Notice their flip flop:
Get Out of Coal Stocks, Jul 25
Coal Stocks Will Recover, Aug 1
CLF's Broken Business Model, Sept 1
Why CLF Is Our Favorite Stock To Play, Sept 14

Disclosure: I've been in KOL, REMX, & CLF. I can sell all three on Monday. I might sell CLF then.

[TradingJackal]

PAGING TradingJackal
Re: MBS mortgage backed securities
I see exactly what u mean
Since Ben's Thursday comments, MBB is up hardly a point, while spy-proxies, banks, smalls, Qs, metals, juiced and unjuiced, are all up soooo much more.
So why dick around with MBSs when there is much more MEAT in just about everything else.
Very helpful, thx

also re: your faves …this is % performance, one month

915wkndbanks.png

also WEEKLY: banks just this week broke out above long term resistance

914wkndltbank.png

Hi Al, after your query I read a bit more about MBS funds. Can't claim I know a lot but it looks like these funds may be 'limited' beneficiaries of the scheme, if at all. Specially in comparison to the banks that create these. My rationale is that the primary purpose of these vehicles is to stay invested in mortgages. Why would they turn the paper in and dissolve themselves? The banks on the other hand shaft the federal govt again by passing off the bad loans to the US federal deficit which is, as in any good socialist country, paid by the 'people'. This is based on reading that the fed's losses are now added to the federal deficit. This was done a couple of years ago.

[BullBear52x]

You stated yesterday you don't like talking politics.
Here's something political, yet it is relevant to trading: The Mitt Romney Factor In 2 Specific Sectors

can you tell whose picture that is?. I thought the picture is funny nothing else.

[ClarkW]

Update on one of A_D's many children (dangled by its feet and wearing a new shirt):

dvy091512a.png

Been fiddling with HighRev's cycles. Something for bulls and bears alike:

hrc091312djia.png

hrc091412djia.png

ZimZeb, That is nice avatar you got there.

You stated yesterday you don't like talking politics.
Here's something political, yet it is relevant to trading: The Mitt Romney Factor In 2 Specific Sectors

Break

Seeking Alpha is a bunch of clowns. Notice their flip flop:
Get Out of Coal Stocks, Jul 25
Coal Stocks Will Recover, Aug 1
CLF's Broken Business Model, Sept 1
Why CLF Is Our Favorite Stock To Play, Sept 14

Disclosure: I've been in KOL, REMX, & CLF. I can sell all three on Monday. I might sell CLF then.

Not a Seeking Alpha fan myself but thought I'd point out that each article you have listed is from a DIFFERENT CONTRIBUTOR. Seeking Alpha is simply a site with hundreds of different people voicing their opinion, some good, some bad. You have four articles voicing four different people's opinion. Just a heads up, that's all

[ClarkW]

From Sentimentrader.com:

"There used to be an old market adage about buying stocks on the Jewish holiday Rosh Hashanah and selling on Yom Kippur. That worked for awhile, but recent market history has proved that the opposite is a better bet.
If we buy the S&P on Rosh Hashanah and sell on Yom Kippur, then over the past 40 years we would have had only 43% winning trades (17 out of 40) with an average return of -0.6%. There are usually 7 or 8 market sessions between the two holidays.
Taking a spin through the recent history of some popular exchange-traded funds, here's how that seasonality has panned out:
Ticker.....Market............% Pos....Avg Return
SPY..........S&P.................38%...........-1.5%
QQQ.........Tech.................42%...........-2.2%
IWM..........Small Caps.....27%...........-3.1%
GLD..........Gold.................83%..........+2.0%
TLT...........Bonds..............38%...........-0.1%
USO.........Oil.....................40%...........-3.7%

Small-caps have fared the worst, while gold did quite well (a persistent bull market helps). Taking a longer-term view of gold, it didn't fare nearly as well prior to the recent bull market. Since '71 it was positive only 47% of the time between those two holidays.
As far as Wednesday's drop goes, checking for other times that a 3-day rally in the S&P 500 was halted by a -2% or worse decline during a bear market, results going forward were modestly weak. The index rallied during the next 2-3 days 42% of the time, but most of that weakness was prior to 1970. Since then, it was closer to even.
If we stipulate that the -2% decline didn't wipe away all the gains from the 3-day rally, then the results become a bit positive, with a rally occurring 5 out of 8 times. Nothing too special.
I haven't been able to check the active option series for the ISE options exchange, but today's overall trading volume was exceptional. There were only 71 equity call options bought for every 100 put options.
In the five years of history that's available, there have only been two other days that saw a more skewed call/put ratio - January 17th and March 10th of 2008. Both were at or within 2 days of multi-week rallies.
There's a 10-year history for the overall ISE ratio (that includes both equities and indexes). That ratio slumped to a remarkable 53 on Wednesday, meaning only 53 calls were bought for every 100 puts. The only other date in the past decade that was lower was August 7th, 2007. After that, stocks took 6 days to bottom, then a multi-week rally ensued.
One day of declines isn't going to give us many oversold readings, and indeed we don't have them. If the poor seasonality follows through again this year, and we slump to new lows during the next 1-2 weeks, then it should set us up well for a multi-week rally.

[BullBear52x]

Paging Doc Al, XLF. see Vol and the indicators above where I circle. nice break out but short term pull back is imminent.IMHO