08/10/2013 Weekend Update

[Cobra]

begin with Institutional buying and selling action from stocktiming. I'm surprised to see that the accumulation decreased so fast that now distribution is very close to accumulation.

[Cobra]

II and AAII. II still mostly are bullish.

[Cobra]

Smart money still huge short.

[Cobra]

Summary of the week's stock picks. A close stop loss is important.
viewtopic.php?f=10&t=1016&p=138858#p138858

[Cobra]

Stock picks for next week.
viewtopic.php?f=10&t=1023&p=138860#p138860

[Al_Dente]

Cumulative NYAD (second panel) did not confirm the 2 Aug SPY high
That’s a negative divergence
It can be cured by bouncing above the pink zero line and up to a new high, but the negative divergence suggests
it is more likely to continue down below the zero line.

Same thing, different view, different time frame, plus volatility

[Cobra]

Cumulative NYAD (second panel) did not confirm the 2 Aug SPY high
That’s a negative divergence
It can be cured by bouncing above the pink zero line and up to a new high, but the negative divergence suggests
it is more likely to continue down below the zero line.

The attachment 89nyadb_png.png is no longer available

Same thing, different view, different time frame, plus volatility

The attachment 89nyadc.png is no longer available

Right, thanks for remind me. This is the first time since 2009 bull market that NYAD cumulative has negative divergence. The same thing happened right before the 2007 top! I have a chart in my public chart list and I know it's important but for the past 4 years, I didn't see any divergence, so gradually I give up checking the chart.

[joegamma]

89nyadb_png.png[/attachment]
Same thing, different view, different time frame, plus volatility

89nyadc.png

Right, thanks for remind me. This is the first time since 2009 bull market that NYAD cumulative has negative divergence. The same thing happened right before the 2007 top! I have a chart in my public chart list and I know it's important but for the past 4 years, I didn't see any divergence, so gradually I give up checking the chart.[/quote]


Refreshing to hear you have some human tendencies like us earth people

[Al_Dente]

Maybe bad news for Apple and BlackBerry?
“Google's Android Seizes Smartphone Market”
Click on the first story here:
http://www.google.com/search?hl=en&gl=u ... 344ybKBynY

Plus: editorial/analysis of that article (grain of salt…. I’m not familiar with this author…)
http://seekingalpha.com/article/1624982 ... ource=feed

[joegamma]

Maybe bad news for Apple and BlackBerry?
“Google's Android Seizes Smartphone Market”
Click on the first story here:
http://www.google.com/search?hl=en&gl=u ... 344ybKBynY

Plus: editorial/analysis of that article (grain of salt…. I’m not familiar with this author…)
http://seekingalpha.com/article/1624982 ... ource=feed

You have the PRETTIEST charts Dr Al!
maybe that info re Apple may bring Naz off its highs, seems maybe the techs were a bit late to (possibly I/T end of) Ben's dance party..(but you have a better handle on sector rotation)

Small caps and financials (green lines) are not leading up anymore and Amex high lows getting more un-positive this week, fwiw

[Al_Dente]

Right, thanks for remind me....

[joegamma]

great read on Nasdaq and name at Tom McClellan's free pagehttp://www.mcoscillator.com/

He once said (paraphrased, don't have exact quote) , regarding technical and fundamental analysis, something like ability and willingness is key to up markets. 'AD line is ability and a measure of liquidity and sentiment indicators are the measure of willingness. What could be more fundamental than that?.

So, this weekend, any boardies have liquidity indicators and sentiment indicators you wish to share?

How do we want to be positioned if liquidity is drying up and sentiment indicators show that longs have already bought?

[Al_Dente]

You have the PRETTIEST charts Dr Al!
maybe that info re Apple may bring Naz off its highs, seems maybe the techs were a bit late to (possibly I/T end of) Ben's dance party..(but you have a better handle on sector rotation)..........

Even though AAPL is still the top holding in QQQ with a weighting of 10.94%, the chart below shows AAPL decoupled from QQQ ... ALL YEAR…….
How long can that last??

QQQ Top Ten Holdings as of 2013-07-03
1. Apple Inc(AAPL ): 10.94%
2. Microsoft Corporation(MSFT ): 8.49%
3. Google, Inc. Class A(GOOG ): 7.02%
4. Oracle Corporation(ORCL ): 4.25%
5. Cisco Systems Inc(CSCO ): 3.82%
6. Amazon.com Inc(AMZN ): 3.72%
7. Intel Corp(INTC ): 3.54%
8. Qualcomm, Inc.(QCOM ): 3.11%
9. Comcast Corp Class A(CMCSA ): 2.62%
10. Gilead Sciences Inc(GILD ): 2.30%

[joegamma]

Thanks Al:How long can that last? indeed

I think the psychological impact on retail traders might be more important than the math of Apple weighting in Qs.
Maybe that means S/T direction of Naz will be determined by s/t direction of Apple (might have a much bigger boost on a rally)?
something to think about





I'm a slow learner (note to me) we have been in a bull market 4+ years, from the big board NYMO and NYSI

but daily has some fodder for bears, up volume has been falling while down volume has been trending up

[joegamma]

August Seasonality Mon and Tue a bit bearishhttp://www.cobrasmarketview.com/seasona ... h-and-day/

a few more reads here on August (now called worst month) (just a googl search, not endorsing them)

this seems very robust, with details of # and avg wins losses and avg % ie" avg gain R2k is 3+%, avg loss is 6+% at x # times"
http://paststat.com/blog/major-us-indic ... ince-1990/ since 1990

http://www.cabot.net/Issues/CWA/Archive ... ality.aspx
ie: liquidity drops and market depth is gone because decision makers are on vacation

explanation of why seasonality happens here http://www.seasonalcharts.com/saisonalitaet.html

and for investorshttp://www.thepatternsite.com/Seasonality.html

past 5 years algorithm research by academics, yet worded for us etf-traders, and has some good stuff on indiidual stocks toohttp://blog.seasonalodds.com/project/au ... asonality/

and hundreds more....

[Al_Dente]

Bond folks are still throwing money into the 1, 2, and 3 year treasurys
The short term bills and notes are “normally” considered a “parking place” awaiting more lucrative investments
That is plenty of money that could be deployed elsewhere (kind of like “dry powder”)

[joegamma]

wer'e in a bull market BUT, maybe equities will need some of that "dry powder" to continue
great read, momentum waning, breadth waning, volume momentum is waninghttp://blogs.decisionpoint.com/chart_sp ... 809cs.html

[taggard]

caution just some thinking not a quantitative post

lifted from mauldin's efforts this week from didier Sornette (french geophysicist and complex systems analyst--as is sort of obvious by the idea.


Most approaches to explain crashes search for possible mechanisms or effects that operate at very short time scales (hours, days or weeks at most). We propose here a radically different view: the underlying cause of the crash must be searched months and years before it, in the progressive increasing build-up of market cooperativity or effective interactions between investors, often translated into accelerating ascent of the market price (the bubble). According to this "critical" point of view, the specific manner by which prices collapsed is not the most important problem: a crash occurs because the market has entered an unstable phase and any small disturbance or process may have triggered the instability. Think of a ruler held up vertically on your finger: this very unstable position will lead eventually to its collapse, as a result of a small (or absence of adequate) motion of your hand…. The collapse is fundamentally due to the unstable position; the instantaneous cause of the collapse is secondary. In the same vein, the growth of the sensitivity and the growing instability of the market close to such a critical point might explain why attempts to unravel the local origin of the crash have been so diverse. Essentially, anything would work once the system is ripe.

this sounds really simple--but look at all the posts everywhere looking at this or that for either "the collapse" or "the bull market". the cause most given for the bull market is likely to be the reason for the collapse one way or another. so the confluence of opinion on central bank liquidity (dude 8-22 and they issue the new 30 trillion 1% 40 year bond and fold all the euro debt into it--and like that) creates the instability. and actually it is the perception rather than the liquidity--but hey are we counting angles on a pin?

so in theory ta sort of implies this--yet most posts look for absolute events. further the idea of the element that makes us strong is our greatest weakness (as seen near the fall of empires for example--or in music or art trends) is sort of dragged in sideways here. the tendency is to see something as good or bad as opposed to both. or neither. this creates an attachment to an idea and that idea distances us to one degree or another from price action.

and this tidbit

In 2005, researchers at the University of Queensland in Australia and University of California at Berkeley traveled to India to study 76 Tibetan Buddhist monks, in order to gain insight into how mental states can affect conscious visual experiences -- and how we might be able to gain more control over the regular fluctuations in our conscious state. Their data indicated that years of meditation training can profoundly affect a phenomenon known as "perceptual rivalry," which takes place when two different images are presented to each eye -- the brain fluctuates, in a matter of seconds, in the dominant image that is perceived. It is thought to be related to brain mechanisms that underly attention and awareness. When the monks practiced meditating on a single object or thought, significant increases in the duration of perceptual dominance occurred. One monk was able to maintain constant visual perception for 723 seconds -- compared to the average of 2.6 seconds in non-meditative control subjects.


good luck to all

[Royal Flush]

ES No Gap chart shows there are multiple possible trend channel formations; 3 bullish one one bearish
http://www.sierrachart.com/image.php?l= ... 792289.png

[Mr. BachNut]

Idle reflections:
Indexes appear to be coiling last few days except Dow, which looks like it has turned down.
If Dow leads, watch for coils to break down. Sometimes 1st break of coil is a false break.
Given weak advance/declines, why didn't indexes show more weakness this week?
Perhaps structure of the options book is prevailing during light summer trade holding indexes above stop thresholds and around particular strikes.
Perhaps two way trade without clarity until OPEX?
This is not the first time during this bull market that breadth has approached oversold at/near trend highs. It's a technical pain in the butt.
Other technicals are showing both bull and bear aspects suggesting internal paradox and conflict. Four Hindenburg Omens this week reflects that.
One paradox of cliff dives is that they often initiate from oversold conditions. Perhaps dip buyers should be cautious this week just in case.
It is hard to imagine what could trigger a drop, but as noted in the Sornette bit below, the trigger does not have to be significant.

I guess the above is net bearish, but the trend is up. So, range of scenarios is pretty wide wide at the moment. Tough to call.
I do have a short on following a particular setup but have very little conviction about whether it will work.
Thinking that clarity comes after OPEX trade clears.