Cobra's Market View

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I'll have meeting whole day today and tomorrow, so the update will be slow, hopefully I still could do update.

The pullback so far looks like a Bull Flag. If this is still year 2013, this pullback would be bought right at open. Let's see if today is of any differences.

members only update starts here: http://www.cobrasmarketview.com/2014/02 ... ay-update/

SPX 5m/60m mind the lower gaps, trends for support

http://www.aaii.com/sentimentsurvey/sent_results and morning numbers at a glance http://www.investing.com/economic-calendar/

Vote Cobra yes, IMF no. You got nuggets?

short term ES update...

koolblue wrote:short term ES update...

Where are you from a daily perspective? If we don't see too much damage in the next couple of days I think we keep going up for the time being.

This morning:
Indonesia's central bank left rates unchanged after a string of solid economic data, and the FT says it's a sign one of Morgan Stanley's "fragile five" emerging market countries [Brazil, India, Indonesia, Turkey, and South Africa] is in better shape than feared.

Fear Mongering and the Emerging Markets, a longer term view:

L_T wrote:

koolblue wrote:short term ES update...

Where are you from a daily perspective? If we don't see too much damage in the next couple of days I think we keep going up for the time being.

LT,on a daily perspective i remain of the opinion that we will see new highs eventually, but on the daily chart prices are into the upper band and the williams indicator is getting to the overbought level which simply means the market needs a little more time to bend those bands back up (the process has already begun). My avgs should have a bullish posture by tomorrow or friday(even with some decline here)..therefore , i feel any rise will be somewhat limited and choppy, for a few more days.

Yardeni again fwiw. The latest mini-correction was triggered by anxiety over an emerging markets crisis, which some feared had the potential to turn into a global contagion. I argued that the crisis would be contained to the Fragile Five, and wouldn’t morph into another Lehman-style financial calamity.

Interestingly, even Nouriel Roubini, who had been a perma-bear during the first four years of the current bull market, was relatively relaxed about the current crisis in a 1/31 article, though it was titled, “The Trouble with Emerging Markets.” He started his analysis ominously, warning: “This mini perfect storm in emerging markets was soon transmitted, via international investors’ risk aversion, to advanced economies’ stock markets. But the immediate trigger for these pressures should not be confused with their deeper causes: Many emerging markets are in real trouble.”

Near the end of his article, Roubini turned more upbeat for some of the same reasons that we didn’t get panicky about the current crisis: “Nonetheless, the threat of a full-fledged currency, sovereign-debt, and banking crisis remains low, even in the Fragile Five, for several reasons. All have flexible exchange rates, a large war chest of reserves to shield against a run on their currencies and banks, and fewer currency mismatches (for example, heavy foreign-currency borrowing to finance investment in local-currency assets). Many also have sounder banking systems, while their public and private debt ratios, though rising, are still low, with little risk of insolvency.”

Last Wednesday, I offered a “too-important-to-implode” analysis of the EM crisis: “Obviously, a widespread emerging markets crisis would be a calamity for the global economy. However, it is precisely because EMs have become so much more important to the global economy that such a crisis might be less rather than more likely. Capital flows aren’t likely to dry up to companies operating in EMs that are doing more and more business in those economies and the rest of the world.”

The Emerging Markets MSCI (in dollars) has been highly correlated with both the CRB raw industrials spot price index and the price of a barrel of Brent crude oil. While the EM MSCI is down 5.0% ytd, it is encouraging to see that commodity prices remain surprisingly stable. That suggests that the global economy is carrying on.

Posting early as I have to go out.

Long. Stop at breakeven.

My summation signal is up.
My composite trend signal is neutral.

My stop was flirted with over night. This trade is looking like a round trip.
That is OK. The setup is designed to accommodate and participate in overbought markets that get more and more overbought.
It is not equipped to scalp. So, to exit at BE if overbought corrects is fine by me.
I may close out on a discretionary basis at some point. (There is generally a move into opening gaps.)
I don't plan to overstay my welcome.

We may be rectifying overbought conditions before a move to new highs or the high for this move may be in.
I don't know.
If the high is in, a measured move down in the SPX would pay a visit to the 200 day MA.
The Dow did visit the 200 day last week, but other indexes did not. So, perhaps there is some unfinished business.
I think such a move would make for a healthy bull market correction, and I would expect to see nice positive divergences down there.
However, the dove has spoken. So, Mr. Market may just as well follow the Mr. T mantra and never go down again...

Nydec at 2000
Down/up volume ratio >3 to 1
Starting off as a “bear trend day”
Too early to tell if the dip buyers will be strong enough to reverse that
[edit: nydec weakend to 1800]

30 min shows the euro/yen led the way

VIX 15m

SPX 5m .. orange trend bounce to mid channel, gap, or neckline

gappy wrote: The latest mini-correction was triggered by anxiety over an emerging markets crisis... .

thanks for that boss
I like that “too-important-to-implode”

hourly hollow red.

cobra what did this mean ? the hourly hollow red ? more up ?

Dailies... SPX trying to find support on 50d SMA, Dow 20d... VIX just slipping under atm

SPX 5m.. tags neckline...