Tuesday, September 30, 2014

S & P Support?

The 1966 level on the S&P index was the level to watch according to Art Cashin.
Well, intraday over the last 4 days we have touched it three times now.

It shouldn't be touched more than twice if it was real support.

Next stop 1900.
I really like this song.


Monday, September 29, 2014

Nat Gas Rounds Corner

On August 10 I blogged of what looked and felt like a possible turn in the price of natural gas with a chart of UNG. The trend change was more confirmed today as the price breaks above a recent price band. Winter is on the way and demand should pick up.
I sold that initial UNG position a few days after the original post as I belatedly realized that it was not going to be a sharp turn. But as the price action looked encouraging I re-initiated a position on Sept 16, and added Sept. 25.
Lets see if this is a good move......

Control your risk,

Thursday, September 25, 2014

Same Advice, Different Day

 I get a kick out of the talking heads. Every time the market pulls back, they remind everyone that you really should buy when others are scared.

Again, and again.
And they are right. Until they are wrong.



Trickle Down

Trickle down economics doesn't work. But the worlds central banks insist on giving money to the big banks in the hope they will loan it out. Banks are in business to make money. They are not in the business of giving people jobs, or helping an economy grow. Unless they can make money on the loans they make. And loans mean more debt for the debtors.

The head of the ECB wants to give the big banks more money.

Politics being what it is around the world, with the Tea Party mentality that has been promoted by the right wing capitalists it is politically impossible to just give the money to those at the bottom of an economy. So why we can't just take these trillions of moneys and build roads and bridges and improve our parks and our common areas is beyond me. That would be an investment in the nations peoples. And they would spend the money, and then perhaps they would take out that home loan.

But we can't do that! That would be more government debt!!!  And all of those people put to work would pay taxes and the loans that banks made to those same people with jobs would expand the money supply. But NO, we can't do that!

So, the slightest hint that a central bank is set to pull back on the cheap money causes the financial assets that were artificially inflated to collapse. And we are back where we started.


Friday, September 19, 2014


Alibaba set to open in minutes.

I see buying in the treasuries.

And the recent large moves in currencies must be dislocating some large players.

What does it mean? I don't know. We will find out later.

Sitting on cash,

Added note:  Jack Ma, the CEO of Alibaba states he wants to be bigger than Walmart. And it seems he could be Walmart on steroids. If BABA goes from B2B to B2C, (consumer) it will have the effect of putting the cheap labor output of China and the world directly available to consumer. This is more deflationary export from them to US.
Cheap, yes. A job creator here. Not so much!

Monday, September 8, 2014

Poor Markets For This Trader

It has been difficult for myself for some months to make a good trade.

My experience is that markets get hard to trade for quite some time before the averages change trend.

This seems like one of those times.

And lately, at near new highs the volume has picked up. The latest trend has been to a rally at the open, and then selling late in the day.

The volume has increased the last few days with no forward movement in the averages. After years of uptrend that spells distribution for me.

The charts.

Time will, of course, tell.

control risk,

Friday, September 5, 2014

Big Bank Weakness

Earlier this year there was selling in the big banks that I watch. Namely Bank O' America and Shittygrope.

Here are the charts with notations of the technical nature of the weakness in these stocks.

There you have it.


A Game of Hot Potato?

The European Central Bank Chairman, Mario Draghi, announced yesterday a surprise rate cut for the Eurozone and the intent of the ECB to purchase asset backed securities much as the U.S. Fed has been doing for years now. This comes at a time when the Fed is expected to be winding down asset purchases (QE2) and to signal the intent to start thinking about raising short term interest rates.

The Euro down sharply yesterday to a multi-month low, along with the Yen. U.S. Dollar sharply higher. This should make our patriots happy.

The intent of an interest rate cut by the ECB is to export the inflation problem that they feel they have.
This is a continuation of the long running currency war that has been going on for the last decade or so, as country after country attempts to devalue the domestic currency in order to stimulate demand for exports and thus create domestic jobs.

Much as a game of "Hot Potato" as everyone attempts to pass the unpleasantness on to someone else.

The U.S. long bonds decline as interest rates rise slightly even as the stock indexes start to sell off.

Some,  David Tepper , think that this spells the end of the long US Treasury "bubble". Perhaps. But not tomorrow. But demand for a Eurobond will continue and the pressure will be on Germany to allow one to be created. And that is where the money will flow, should that happen.

Watch the money flows. 

And the enthusiasm for the US stocks seems to be weak at the moment.

The world would not have this problem if labor hadn't been so weak for so long. All of those trillions getting parked in government bonds by corporations would be in the saving accounts of private individuals and circulating in the economy. And thus the attempts to devalue would have worked long ago and we would be done with this nonsense, instead of trying to stimulate more debt creation on the backs of consumers, along with keeping the stock indexes artificially high because the voters are desperately depending on stocks as a store of "value" for retirement.  But who can stop playing the game? You first!

Control risk,