The Dow, S&P 500, Nasdaq, and Russell 2000 are all in uptrends. So according to the trends of the major indices, the bulls have an advantage over the bears going into trading next week.
Let's look at the market internals to see if they confirm my thesis for trading next week.
The TICK has taken an anticipated swing move down after being above 800 for three weeks in a row. The TICK has a strong bullish bias because the swing move ups hit higher levels than the swing moves down.
Looking at the Nasdaq Advance-Decline Volume chart, it continues to move higher above the 0 line which is bullish.
The VIX is in a downtrend. It's broken below the 200 day moving average for the first time since July. This is bullish for the market as it means that PUT buying or hedging is on the decline.
The percentage of stocks on the NYSE that are trading above their 50 day moving average is an incredible 88%. This is bullish.
The percentage of stocks on the NYSE that are trading above their 200 day moving average has risen to 39%. This is bearish. We expect this indicator to be a lagging indicator because it's based on a longer timeframe of 200 days.
Our market internal indicators support the bulls on top thesis going into trading next week.
Whether you are a gold bug or a stock trader, all our futures are currently linked by one market, oil. If you look at the S&P 500 and DBO over the last 2 years, they are in lock-step. The reason is that traders are looking to oil for a sign that the recession is ending. The newspapers and media outlets are lagging indicators and won't tell you the recession is over until 6 months to a year later. As traders, if we want to capture the profits, we can't wait for media to tell us: oil, enter stage right. Right now a rise in oil means that global business demand is rising as oil consumption rises. This relation is not always true. Back in 2005, oil going up meant that the market would go down. Relationships on Wall Street, just like in real life, change over time. For now, chart both the S&P 500 and oil and see for yourself that both are working together. Therefore, if you're long this market like I am, you want oil to rise. If you're long gold, you want oil to rise because gold too is in lock-step with oil. Gold and stock traders are all united right now courtesy of oil.
Gold is upgraded to an uptrend. You have my blessing to dabble in gold now. We'd like to see a strong uptrend in gold, but an uptend will do.
The U.S. dollar is downgraded to a downtrend. It has broken below the 200 day moving average and looks set to test the August low at around $73.
Silver is upgraded to an uptrend. You have my blessing to take a long entry in silver now. If you wanted to play this a little safer, you could wait for a confirmed break above the 200 day moving average and a strong uptrend to form.
Large cap gold miners (GDX) are in a weak uptrend. Small cap gold miners (GDXJ) are in an uptrend. So small cap gold miners are leading large cap gold miners higher. Small caps leading large caps higher is bullish folks. You have my blessing to dabble in gold mining stocks now.
Financials (XLF) is in an uptrend. I have a negative bias against the financial sector right now folks so I just can't go long stocks in this sector. Nevertheless, biases aside, the trend in XLF is up.
The top performing S&P 500 sectors so far for the 4th quarter are:
#1 = Energy up 24.8%
#2 = Basic Materials up 22.8%
#3 = Financials up 19%
#4 = Industrials up 17%
The top performing industry groups for the 4th quarter are:
#1 = Oil Services up 27%
#2 = Brokers up 19.5%
#3 = Banks up 18%
#4 = Semiconductors up 17%
Fundamental analysis reports that gave the greatest probability of moving markets next week are:
11/1/2011 Tuesday = ISM Mfg Index
11/2/2011 Wednesday = FOMC Meeting Announcement
11/4/2011 Friday = Employment Situation
The Dow, S&P 500, Nasdaq, and Russell 2000 are all in uptrends. So according to the trends of the major indices, the bulls have an advantage over the bears going into trading next week.
Let's look at the market internals to see if they confirm my thesis for trading next week.
The TICK has taken an anticipated swing move down after being above 800 for three weeks in a row. The TICK has a strong bullish bias because the swing move ups hit higher levels than the swing moves down.
Looking at the Nasdaq Advance-Decline Volume chart, it continues to move higher above the 0 line which is bullish.
The VIX is in a downtrend. It's broken below the 200 day moving average for the first time since July. This is bullish for the market as it means that PUT buying or hedging is on the decline.
The percentage of stocks on the NYSE that are trading above their 50 day moving average is an incredible 88%. This is bullish.
The percentage of stocks on the NYSE that are trading above their 200 day moving average has risen to 39%. This is bearish. We expect this indicator to be a lagging indicator because it's based on a longer timeframe of 200 days.
Our market internal indicators support the bulls on top thesis going into trading next week.
Whether you are a gold bug or a stock trader, all our futures are currently linked by one market, oil. If you look at the S&P 500 and DBO over the last 2 years, they are in lock-step. The reason is that traders are looking to oil for a sign that the recession is ending. The newspapers and media outlets are lagging indicators and won't tell you the recession is over until 6 months to a year later. As traders, if we want to capture the profits, we can't wait for media to tell us: oil, enter stage right. Right now a rise in oil means that global business demand is rising as oil consumption rises. This relation is not always true. Back in 2005, oil going up meant that the market would go down. Relationships on Wall Street, just like in real life, change over time. For now, chart both the S&P 500 and oil and see for yourself that both are working together. Therefore, if you're long this market like I am, you want oil to rise. If you're long gold, you want oil to rise because gold too is in lock-step with oil. Gold and stock traders are all united right now courtesy of oil.
Gold is upgraded to an uptrend. You have my blessing to dabble in gold now. We'd like to see a strong uptrend in gold, but an uptend will do.
The U.S. dollar is downgraded to a downtrend. It has broken below the 200 day moving average and looks set to test the August low at around $73.
Silver is upgraded to an uptrend. You have my blessing to take a long entry in silver now. If you wanted to play this a little safer, you could wait for a confirmed break above the 200 day moving average and a strong uptrend to form.
Large cap gold miners (GDX) are in a weak uptrend. Small cap gold miners (GDXJ) are in an uptrend. So small cap gold miners are leading large cap gold miners higher. Small caps leading large caps higher is bullish folks. You have my blessing to dabble in gold mining stocks now.
Financials (XLF) is in an uptrend. I have a negative bias against the financial sector right now folks so I just can't go long stocks in this sector. Nevertheless, biases aside, the trend in XLF is up.
The top performing S&P 500 sectors so far for the 4th quarter are:
#1 = Energy up 24.8%
#2 = Basic Materials up 22.8%
#3 = Financials up 19%
#4 = Industrials up 17%
The top performing industry groups for the 4th quarter are:
#1 = Oil Services up 27%
#2 = Brokers up 19.5%
#3 = Banks up 18%
#4 = Semiconductors up 17%
Fundamental analysis reports that gave the greatest probability of moving markets next week are:
11/1/2011 Tuesday = ISM Mfg Index
11/2/2011 Wednesday = FOMC Meeting Announcement
11/4/2011 Friday = Employment Situation
The Dow, S&P 500, Nasdaq, and Russell 2000 are all in uptrends. So according to the trends of the major indices, the bulls have an advantage over the bears going into trading next week.
Let's look at the market internals to see if they confirm my thesis for trading next week.
The TICK has taken an anticipated swing move down after being above 800 for three weeks in a row. The TICK has a strong bullish bias because the swing move ups hit higher levels than the swing moves down.
Looking at the Nasdaq Advance-Decline Volume chart, it continues to move higher above the 0 line which is bullish.
The VIX is in a downtrend. It's broken below the 200 day moving average for the first time since July. This is bullish for the market as it means that PUT buying or hedging is on the decline.
The percentage of stocks on the NYSE that are trading above their 50 day moving average is an incredible 88%. This is bullish.
The percentage of stocks on the NYSE that are trading above their 200 day moving average has risen to 39%. This is bearish. We expect this indicator to be a lagging indicator because it's based on a longer timeframe of 200 days.
Our market internal indicators support the bulls on top thesis going into trading next week.
Whether you are a gold bug or a stock trader, all our futures are currently linked by one market, oil. If you look at the S&P 500 and DBO over the last 2 years, they are in lock-step. The reason is that traders are looking to oil for a sign that the recession is ending. The newspapers and media outlets are lagging indicators and won't tell you the recession is over until 6 months to a year later. As traders, if we want to capture the profits, we can't wait for media to tell us: oil, enter stage right. Right now a rise in oil means that global business demand is rising as oil consumption rises. This relation is not always true. Back in 2005, oil going up meant that the market would go down. Relationships on Wall Street, just like in real life, change over time. For now, chart both the S&P 500 and oil and see for yourself that both are working together. Therefore, if you're long this market like I am, you want oil to rise. If you're long gold, you want oil to rise because gold too is in lock-step with oil. Gold and stock traders are all united right now courtesy of oil.
Gold is upgraded to an uptrend. You have my blessing to dabble in gold now. We'd like to see a strong uptrend in gold, but an uptend will do.
The U.S. dollar is downgraded to a downtrend. It has broken below the 200 day moving average and looks set to test the August low at around $73.
Silver is upgraded to an uptrend. You have my blessing to take a long entry in silver now. If you wanted to play this a little safer, you could wait for a confirmed break above the 200 day moving average and a strong uptrend to form.
Large cap gold miners (GDX) are in a weak uptrend. Small cap gold miners (GDXJ) are in an uptrend. So small cap gold miners are leading large cap gold miners higher. Small caps leading large caps higher is bullish folks. You have my blessing to dabble in gold mining stocks now.
Financials (XLF) is in an uptrend. I have a negative bias against the financial sector right now folks so I just can't go long stocks in this sector. Nevertheless, biases aside, the trend in XLF is up.
The top performing S&P 500 sectors so far for the 4th quarter are:
#1 = Energy up 24.8%
#2 = Basic Materials up 22.8%
#3 = Financials up 19%
#4 = Industrials up 17%
The top performing industry groups for the 4th quarter are:
#1 = Oil Services up 27%
#2 = Brokers up 19.5%
#3 = Banks up 18%
#4 = Semiconductors up 17%
Fundamental analysis reports that gave the greatest probability of moving markets next week are:
11/1/2011 Tuesday = ISM Mfg Index
11/2/2011 Wednesday = FOMC Meeting Announcement
11/4/2011 Friday = Employment Situation
Wow folks, unbelievable! What a difference a day makes! Major damage was done to the bull camp today. In fact, the bulls no longer have an advantage over the bears. We've fallen back into the dreaded trading range.
I'm out of this market man. I've closed out all my longs and moved back to the safety of cash. I am being way too aggressive by buying TVIX, but hey, no guts, no glory. I've made good money over the last year and so I'm not being as defensive as I probably should. For those of you that don't know, TVIX is a bear market stock that goes long the VIX by a whopping 3x leverage.
What really spooked me out of my longs besides the huge fact that we've fallen back into the trading range? Lots of things.
The StochRSI has broken below the 0.8 line on the major indices. Remember, we put more weighting on the StochRSI because it's a trading indicator and the market is in a trading range.
Next, notice how the Russell 2000 is leading the market lower. I expressed concern over the lack of upside leadership by the Russell 2000 in the weekend video update. Not only was the Russell 2000 not leading the major indices up, but now it's leading them all down. That's a big red flag as it means that traders appetite for risk is falling. The Russell 2000 is in a very weak downtrend.
Next, the percentage of stocks trading above the 50 day moving average has dropped from 62% at close Friday, not 48% today! That means that this market internal indicator is no longer giving the bulls the advantage, in fact, it's giving a slight advantage to the bears now!
The VIX has done a massive bounce right off its 200 day moving average line. While the trend is still down on the VIX, notice how the StochRSI has broken above the 0.2 line which is a buy signal. VXZ which is the mid-term futures VIX retook its 50 day moving average today!
But wait, there's more market internal indicators that now favor the bears. The Nasdaq Advance-Decline volume has broken below the 0 line which means it now favors the bear camp!
Wow folks, unbelievable! What a difference a day makes! Major damage was done to the bull camp today. In fact, the bulls no longer have an advantage over the bears. We've fallen back into the dreaded trading range.
I'm out of this market man. I've closed out all my longs and moved back to the safety of cash. I am being way too aggressive by buying TVIX, but hey, no guts, no glory. I've made good money over the last year and so I'm not being as defensive as I probably should. For those of you that don't know, TVIX is a bear market stock that goes long the VIX by a whopping 3x leverage.
What really spooked me out of my longs besides the huge fact that we've fallen back into the trading range? Lots of things.
The StochRSI has broken below the 0.8 line on the major indices. Remember, we put more weighting on the StochRSI because it's a trading indicator and the market is in a trading range.
Next, notice how the Russell 2000 is leading the market lower. I expressed concern over the lack of upside leadership by the Russell 2000 in the weekend video update. Not only was the Russell 2000 not leading the major indices up, but now it's leading them all down. That's a big red flag as it means that traders appetite for risk is falling. The Russell 2000 is in a very weak downtrend.
Next, the percentage of stocks trading above the 50 day moving average has dropped from 62% at close Friday, not 48% today! That means that this market internal indicator is no longer giving the bulls the advantage, in fact, it's giving a slight advantage to the bears now!
The VIX has done a massive bounce right off its 200 day moving average line. While the trend is still down on the VIX, notice how the StochRSI has broken above the 0.2 line which is a buy signal. VXZ which is the mid-term futures VIX retook its 50 day moving average today!
But wait, there's more market internal indicators that now favor the bears. The Nasdaq Advance-Decline volume has broken below the 0 line which means it now favors the bear camp!
Wow folks, unbelievable! What a difference a day makes! Major damage was done to the bull camp today. In fact, the bulls no longer have an advantage over the bears. We've fallen back into the dreaded trading range.
I'm out of this market man. I've closed out all my longs and moved back to the safety of cash. I am being way too aggressive by buying TVIX, but hey, no guts, no glory. I've made good money over the last year and so I'm not being as defensive as I probably should. For those of you that don't know, TVIX is a bear market stock that goes long the VIX by a whopping 3x leverage.
What really spooked me out of my longs besides the huge fact that we've fallen back into the trading range? Lots of things.
The StochRSI has broken below the 0.8 line on the major indices. Remember, we put more weighting on the StochRSI because it's a trading indicator and the market is in a trading range.
Next, notice how the Russell 2000 is leading the market lower. I expressed concern over the lack of upside leadership by the Russell 2000 in the weekend video update. Not only was the Russell 2000 not leading the major indices up, but now it's leading them all down. That's a big red flag as it means that traders appetite for risk is falling. The Russell 2000 is in a very weak downtrend.
Next, the percentage of stocks trading above the 50 day moving average has dropped from 62% at close Friday, not 48% today! That means that this market internal indicator is no longer giving the bulls the advantage, in fact, it's giving a slight advantage to the bears now!
The VIX has done a massive bounce right off its 200 day moving average line. While the trend is still down on the VIX, notice how the StochRSI has broken above the 0.2 line which is a buy signal. VXZ which is the mid-term futures VIX retook its 50 day moving average today!
But wait, there's more market internal indicators that now favor the bears. The Nasdaq Advance-Decline volume has broken below the 0 line which means it now favors the bear camp!
The market continues to be in sideways trading range and so there's no need for a trend update this week. Remember, a sideways range will continue until it actually ends. On days price falls within the trading range, assume continuation of the sideways trading range until proven otherwise.
There is a high probability, 80%, that the seasonal 4th quarter rally will occur this year. Long time readers will recall that last year, I made 90% in the month of December from the seasonal 4th quarter rally and in particular, the Santa Claus Rally.
What do I like best for the 4th quarter rally?
To answer that, we have to look at what the institutional traders are buying right now. The TICK indicator gave us a near 1,000 reading this week which suggests institutional buying at the start of the 4th quarter. But the question is, what sectors are they positioning themselves into this year?
Without a doubt, Basic Materials has had the biggest inflow of money for the first week of trading in October. I bought MATL for my own personal trading account which is the 3x leveraged Basic Materials play. This is a long term hold for the entire 4th quarter unless MATL spikes up on us, forcing us to sell early.
I also like gold which is in its seasonally strong time of year. The thing you have to watch out for though with gold is the strong uptrend on the U.S. dollar. You want evidence that the U.S. dollar and gold have decoupled from each other. Seasonally, gold is a great hold for the 4th quarter, but the uptrend on the U.S. dollar means anything could happen including a fizzle and dud this year for 4th quarter precious metal players.
Fundamental analysis reports that moved markets last week were: Monday's ISM Mfg Index, and Friday's Employment Situation.
The ISM Mfg report showed employment picked up and production picked up, but orders in the manufacturing sector are flat at the very best, according to September data from the Institute For Supply Management whose composite index came in at 51.6 vs Econoday expectations for 50.5. The employment component rose two full points to 53.8 to indicate a tangible increase in hiring. This is in line with a tangible increase in production which rose more than 2-1/2 points to 51.2. Now the bad news in the report. New orders are under 50 for a third month in a row, though just barely at 49.6 in a reading that hints at fractional contraction in final demand. Manufacturers, waiting for new orders to pick up, have been chewing through back orders in recent months and continued to do so in September as backlog orders fell 4-1/2 points to a 41.5 level that indicates sizable contraction. One plus on the order side is a pick up in new export orders which rose two points to 53.5.
The Employment Situation report showed job growth improved more than expected in September although the gain was held back by contraction in the government sector. Payroll jobs advanced 103,000 in September, following a revised 57,000 rise in August (originally flat) and revised 127,000 increase in July (previously 85,000). Analysts forecast for a 65,000 increase for September. Revisions for July and August were up net 99,000. Private nonfarm payrolls were somewhat stronger than the total, gaining 137,000 in September, following a 42,000 increase in August and 173,000 boost in July. The September number topped the market expectation for a 95,000 increase. A return of striking telecommunications workers added about 45,000 to the payroll total and private tally.
Fundamental analysis reports with the greatest probability of moving markets next week are:
Thursday - October 13, 2011 = International Trade
Friday - October 14, 2011 = Retail Sales
The market continues to be in sideways trading range and so there's no need for a trend update this week. Remember, a sideways range will continue until it actually ends. On days price falls within the trading range, assume continuation of the sideways trading range until proven otherwise.
There is a high probability, 80%, that the seasonal 4th quarter rally will occur this year. Long time readers will recall that last year, I made 90% in the month of December from the seasonal 4th quarter rally and in particular, the Santa Claus Rally.
What do I like best for the 4th quarter rally?
To answer that, we have to look at what the institutional traders are buying right now. The TICK indicator gave us a near 1,000 reading this week which suggests institutional buying at the start of the 4th quarter. But the question is, what sectors are they positioning themselves into this year?
Without a doubt, Basic Materials has had the biggest inflow of money for the first week of trading in October. I bought MATL for my own personal trading account which is the 3x leveraged Basic Materials play. This is a long term hold for the entire 4th quarter unless MATL spikes up on us, forcing us to sell early.
For a FREE DAILY EMAIL ALERT on the trend of the Direxion Daily Basic Matls Bull 3X Shrs (MATL) click here! Just leave PACF_MATL in for the symbol and enter your name and email address!
I also like gold which is in its seasonally strong time of year. The thing you have to watch out for though with gold is the strong uptrend on the U.S. dollar. You want evidence that the U.S. dollar and gold have decoupled from each other. Seasonally, gold is a great hold for the 4th quarter, but the uptrend on the U.S. dollar means anything could happen including a fizzle and dud this year for 4th quarter precious metal players.
For a FREE DAILY EMAIL ALERT on the trend of the ProShares Ultra Gold (UGL) click here! Just leave PACF_UGL in for the symbol and enter your name and email address!
Fundamental analysis reports that moved markets last week were: Monday's ISM Mfg Index, and Friday's Employment Situation.
The ISM Mfg report showed employment picked up and production picked up, but orders in the manufacturing sector are flat at the very best, according to September data from the Institute For Supply Management whose composite index came in at 51.6 vs Econoday expectations for 50.5. The employment component rose two full points to 53.8 to indicate a tangible increase in hiring. This is in line with a tangible increase in production which rose more than 2-1/2 points to 51.2. Now the bad news in the report. New orders are under 50 for a third month in a row, though just barely at 49.6 in a reading that hints at fractional contraction in final demand. Manufacturers, waiting for new orders to pick up, have been chewing through back orders in recent months and continued to do so in September as backlog orders fell 4-1/2 points to a 41.5 level that indicates sizable contraction. One plus on the order side is a pick up in new export orders which rose two points to 53.5.
The Employment Situation report showed job growth improved more than expected in September although the gain was held back by contraction in the government sector. Payroll jobs advanced 103,000 in September, following a revised 57,000 rise in August (originally flat) and revised 127,000 increase in July (previously 85,000). Analysts forecast for a 65,000 increase for September. Revisions for July and August were up net 99,000. Private nonfarm payrolls were somewhat stronger than the total, gaining 137,000 in September, following a 42,000 increase in August and 173,000 boost in July. The September number topped the market expectation for a 95,000 increase. A return of striking telecommunications workers added about 45,000 to the payroll total and private tally.
Fundamental analysis reports with the greatest probability of moving markets next week are:
Thursday - October 13, 2011 = International Trade
Friday - October 14, 2011 = Retail Sales
The market continues to be in sideways trading range and so there's no need for a trend update this week. Remember, a sideways range will continue until it actually ends. On days price falls within the trading range, assume continuation of the sideways trading range until proven otherwise.
There is a high probability, 80%, that the seasonal 4th quarter rally will occur this year. Long time readers will recall that last year, I made 90% in the month of December from the seasonal 4th quarter rally and in particular, the Santa Claus Rally.
What do I like best for the 4th quarter rally?
To answer that, we have to look at what the institutional traders are buying right now. The TICK indicator gave us a near 1,000 reading this week which suggests institutional buying at the start of the 4th quarter. But the question is, what sectors are they positioning themselves into this year?
Without a doubt, Basic Materials has had the biggest inflow of money for the first week of trading in October. I bought MATL for my own personal trading account which is the 3x leveraged Basic Materials play. This is a long term hold for the entire 4th quarter unless MATL spikes up on us, forcing us to sell early.
For a FREE DAILY EMAIL ALERT on the trend of the Direxion Daily Basic Matls Bull 3X Shrs (MATL) click here! Just leave PACF_MATL in for the symbol and enter your name and email address!
I also like gold which is in its seasonally strong time of year. The thing you have to watch out for though with gold is the strong uptrend on the U.S. dollar. You want evidence that the U.S. dollar and gold have decoupled from each other. Seasonally, gold is a great hold for the 4th quarter, but the uptrend on the U.S. dollar means anything could happen including a fizzle and dud this year for 4th quarter precious metal players.
For a FREE DAILY EMAIL ALERT on the trend of the ProShares Ultra Gold (UGL) click here! Just leave PACF_UGL in for the symbol and enter your name and email address!
Fundamental analysis reports that moved markets last week were: Monday's ISM Mfg Index, and Friday's Employment Situation.
The ISM Mfg report showed employment picked up and production picked up, but orders in the manufacturing sector are flat at the very best, according to September data from the Institute For Supply Management whose composite index came in at 51.6 vs Econoday expectations for 50.5. The employment component rose two full points to 53.8 to indicate a tangible increase in hiring. This is in line with a tangible increase in production which rose more than 2-1/2 points to 51.2. Now the bad news in the report. New orders are under 50 for a third month in a row, though just barely at 49.6 in a reading that hints at fractional contraction in final demand. Manufacturers, waiting for new orders to pick up, have been chewing through back orders in recent months and continued to do so in September as backlog orders fell 4-1/2 points to a 41.5 level that indicates sizable contraction. One plus on the order side is a pick up in new export orders which rose two points to 53.5.
The Employment Situation report showed job growth improved more than expected in September although the gain was held back by contraction in the government sector. Payroll jobs advanced 103,000 in September, following a revised 57,000 rise in August (originally flat) and revised 127,000 increase in July (previously 85,000). Analysts forecast for a 65,000 increase for September. Revisions for July and August were up net 99,000. Private nonfarm payrolls were somewhat stronger than the total, gaining 137,000 in September, following a 42,000 increase in August and 173,000 boost in July. The September number topped the market expectation for a 95,000 increase. A return of striking telecommunications workers added about 45,000 to the payroll total and private tally.
Fundamental analysis reports with the greatest probability of moving markets next week are:
Thursday - October 13, 2011 = International Trade
Friday - October 14, 2011 = Retail Sales
For the month of September we have lost 59%. Ouch!
Here's what happened. The month started off good, but then got bad towards the end. What happened folks is a compression of the ranges that are being traded. With nice big volatility swings, we were able to more easily capture the move.
The other thing that happened was that I took a gamble on September 12th, when the lower Bearish Flag wall was broke, that the downtrend that began in August would continue. That didn't happened as we were stopped out of our short positions. Next, we took another run on the short side on September 20th when the lower wall of the Bearish Flag was broke again. Once again, the market moved up and we got stopped out.
That was a huge gamble I took and had it paid off, I would be doing a video about how we made 300% or more for the month of September. But the market moved against our short position and stopped us out. You have to set stop losses and get stopped out. That's part of trading. In the cast of these 3x leveraged funds, my stop loss was 5% x 3 = 15% stop loss.
What is clear now is that we were not in a Bearish Flag pattern but a sideways, rectangle pattern.
I can't keep trading with TZA, TNA, and TVIX with this market having no trend and being unpredictable going sideways like this into a trading range.
I'm dialing down the risk and I'm buying UGL, the 2x leveraged gold ETF. If you follow me on twitter you'll know I've been in gold for about the last two days. Gold is still within its strong time of year: September and October are the strongest months of the year for gold. My time horizon is 4 to 12 weeks with an exit in December. This is a long term play on the seasonal trends in gold.
This is unbelievable that we can get in gold off the 200 day moving average folks. A month ago, or two months ago, or even three months ago, we would have killed to be able to buy gold off its 200 day moving average like we can today. The reasons we are able to enter gold this cheap is: 1 - strong dollar, 2 - weak oil, and 3 - gold margin rate hike. But these things are now priced in and I actually am very thankful these things have come to be else I wouldn't be able to buy gold this cheap.
In the video below I go more into the chart of UGL (2x gold ETF) and show you in detail some excellent technical indicators that signal gold is a buy right now.
For the month of September we have lost 59%. Ouch!
Here's what happened. The month started off good, but then got bad towards the end. What happened folks is a compression of the ranges that are being traded. With nice big volatility swings, we were able to more easily capture the move.
The other thing that happened was that I took a gamble on September 12th, when the lower Bearish Flag wall was broke, that the downtrend that began in August would continue. That didn't happened as we were stopped out of our short positions. Next, we took another run on the short side on September 20th when the lower wall of the Bearish Flag was broke again. Once again, the market moved up and we got stopped out.
That was a huge gamble I took and had it paid off, I would be doing a video about how we made 300% or more for the month of September. But the market moved against our short position and stopped us out. You have to set stop losses and get stopped out. That's part of trading. In the cast of these 3x leveraged funds, my stop loss was 5% x 3 = 15% stop loss.
What is clear now is that we were not in a Bearish Flag pattern but a sideways, rectangle pattern.
I can't keep trading with TZA, TNA, and TVIX with this market having no trend and being unpredictable going sideways like this into a trading range.
I'm dialing down the risk and I'm buying UGL, the 2x leveraged gold ETF. If you follow me on twitter you'll know I've been in gold for about the last two days. Gold is still within its strong time of year: September and October are the strongest months of the year for gold. My time horizon is 4 to 12 weeks with an exit in December. This is a long term play on the seasonal trends in gold.
This is unbelievable that we can get in gold off the 200 day moving average folks. A month ago, or two months ago, or even three months ago, we would have killed to be able to buy gold off its 200 day moving average like we can today. The reasons we are able to enter gold this cheap is: 1 - strong dollar, 2 - weak oil, and 3 - gold margin rate hike. But these things are now priced in and I actually am very thankful these things have come to be else I wouldn't be able to buy gold this cheap.
In the video below I go more into the chart of UGL (2x gold ETF) and show you in detail some excellent technical indicators that signal gold is a buy right now.
For a FREE DAILY EMAIL ALERT on the trend of ProShares Ultra Gold (UGL) click here! Just leave PACF_UGL in for the symbol and enter your name and email address!For a FREE DAILY EMAIL ALERT on the trend of ProShares Ultra Gold (UGL) click here! Just leave PACF_UGL in for the symbol and enter your name and email address!
For the month of September we have lost 59%. Ouch!
Here's what happened. The month started off good, but then got bad towards the end. What happened folks is a compression of the ranges that are being traded. With nice big volatility swings, we were able to more easily capture the move.
The other thing that happened was that I took a gamble on September 12th, when the lower Bearish Flag wall was broke, that the downtrend that began in August would continue. That didn't happened as we were stopped out of our short positions. Next, we took another run on the short side on September 20th when the lower wall of the Bearish Flag was broke again. Once again, the market moved up and we got stopped out.
That was a huge gamble I took and had it paid off, I would be doing a video about how we made 300% or more for the month of September. But the market moved against our short position and stopped us out. You have to set stop losses and get stopped out. That's part of trading. In the cast of these 3x leveraged funds, my stop loss was 5% x 3 = 15% stop loss.
What is clear now is that we were not in a Bearish Flag pattern but a sideways, rectangle pattern.
I can't keep trading with TZA, TNA, and TVIX with this market having no trend and being unpredictable going sideways like this into a trading range.
I'm dialing down the risk and I'm buying UGL, the 2x leveraged gold ETF. If you follow me on twitter you'll know I've been in gold for about the last two days. Gold is still within its strong time of year: September and October are the strongest months of the year for gold. My time horizon is 4 to 12 weeks with an exit in December. This is a long term play on the seasonal trends in gold.
This is unbelievable that we can get in gold off the 200 day moving average folks. A month ago, or two months ago, or even three months ago, we would have killed to be able to buy gold off its 200 day moving average like we can today. The reasons we are able to enter gold this cheap is: 1 - strong dollar, 2 - weak oil, and 3 - gold margin rate hike. But these things are now priced in and I actually am very thankful these things have come to be else I wouldn't be able to buy gold this cheap.
In the video below I go more into the chart of UGL (2x gold ETF) and show you in detail some excellent technical indicators that signal gold is a buy right now.
For a FREE DAILY EMAIL ALERT on the trend of ProShares Ultra Gold (UGL) click here! Just leave PACF_UGL in for the symbol and enter your name and email address!For a FREE DAILY EMAIL ALERT on the trend of ProShares Ultra Gold (UGL) click here! Just leave PACF_UGL in for the symbol and enter your name and email address!
The Dow, S&P 500, and Russell 2000 are all in strong downtrends. The NASDAQ is holding up slightly better but even it is in a week downtrend. According to the major indices, the Bears have a strong advantage over the Bulls going into trading next week.
Now let's look at some market internals and see if they confirm my Bears on top thesis.
The percentage of stocks on the New York Stock Exchange that are trading above their 50 day moving average is 12%. Anything below 50% is bearish. The percentage of stocks on the New York Stock Exchange that are trading above their 200 day moving average is 14%. Again, this shows a strong bearish bias.
The NASDAQ Advance Decline Volume index clearly shows greater volume on selling days. Folks, again this shows a bearish bias. Think of volume as a measure of emotion. The emotional intensity is stronger in the Bear camp. Another way to say that is that Bears are more passionate in their belief that this market is going lower, than Bulls are in their belief that the market is going to go higher.
The ratio chart of the number of new lows to the total number of stocks traded on the NYSE is rising. In fact, it's risen to its highest level since breaking above the 0.025 line since January of 2008. Conversely, the amount of new highs being made has fallen to its lowest level after breaking the 0.025 line since January of 2008. This is bearish.
The Vix is in a strong uptrend. The Vix has been the best leading indicator for the trend in the market. Last week, I called into question the uptrend rating on the major indices because of the strong uptrend on the Vix. It just seemed too strange to have put buying trending upward at the same time the market was going upward. As I stated in last week's video, either the Vix was going to crash and fall in line with the market or the market was going to crash to fall in line with the Vix. As we now know, it was the market that crashed to fall in line with the Vix. Not only is the Vix in a strong uptrend which is bearish for this market, but the Resurrection Cross of the 50 day moving average crossing above the 200 day moving average has been confirmed. The Vix clearly supports my thesis that the Bears have an advantage over the Bulls going into trading next week.
Gold is in a weak downtrend. It has been downgraded from last week's sidelines rating. In last week's video what did I tell you the trend in gold was, sidelines right? I said you should move to the sidelines after booking your profits. If gold broke below the 50 day moving average, you would be glad that you sold out. If gold bounced off the 50 day moving average you could always get back in when it goes into a strong uptrend. Now a lot of you listening to my videos did not follow my advice. Bad move. Are you going to be a dummy and ride gold all the way down again? How do you know that this pullback in gold is not going to be another 2006 to 2007 plunge in gold? It took most gold bugs 2 to 3 years to recover their losses. Are you doomed to repeat the same mistake twice?
As a gold bug, why do you have to suffer these huge drawdowns? The answer is you don't. I don't care what your logic is. If you hold gold and it drops more than 20% on you, you are a failed trader and you are not trading right. Now the logic of some gold bugs is to say Lance, I don't care what you say. I subscribe to Doug Casey, Peter Schiff, and Peter DeGraff and these guys are all in. If they're all in gold then I'm all in gold. Because these guys are millionaires and billionaires and they didn't get that way from being stupid in their trading. They know how to trade, that's why they're rich. This is simply not true. These guys made their money not from their stock trading but from there gold bug newsletters and if they manage a fund like Peter Schiff. In other words they make their money from the businesses that they run and not their stock trading. Think about it. Why deal with the headaches of a business if you could be a millionaire and billionaire just from your stock trading?-- just from the point and click of a mouse. Why deal with taxes, a business license, hiring someone to answer the phones, advertising, employees, laws, customer service, processing customer credit cards and payments, and the dozens of other headaches it takes to run your own business? If these guys really were millionaires and billionaires just from their stock trading, they wouldn't need your $100, $400, or $1,000 a year to subscribe to their newsletters. The truth is they haven't become millionaires and billionaires from their stock trading. They need your money. The other argument I've gotten from gold bugs is well, Lance, you can't buy bottoms. I totally agree with that. In fact, I'll expand on that and say you can't buy bottoms or sell tops. But that line of logic applied to holding onto gold too long is what's called a non-sequitur. Some might call it a straw man. It's taking a truth in some other aspect of trading and applying it in an illogical way to gold. Sure you can't buy bottoms and sell tops, but you can trade trends. Holding onto gold for too long and suffering huge drawdowns, and not setting a stop loss, and then justifying those huge drawdowns with the logic that you can't buy bottoms and sell tops is dumb. You can trade the trend. Simply establish the trend and then trade it.
Silver is in a strong downtrend. Silver is in worse shape than gold.
The US dollar is in a strong uptrend. It broke above the 200 day moving average in the first part of September, retraced testing the 200 day moving average again which held, and then rocketed off of it. We are also getting closer and closer to a Resurrection Cross where the 50 day moving average crosses above the 200 day moving average. We don't have that yet but we continue to move closer to it. Wait a second! I thought Peter Schiff said a couple years ago that the dollar was going to go worthless. In the best case scenario, he said, gold was going back to 50. According to Doug Casey, Peter Schiff, Mark Skousen, and other Republican ideologues and gold bugs, the dollar was going to go worthless. The policies of the Democrat government were causing the value of the dollar to go down. They were just printing more money. Republicans coined the term "helicopter Ben". The National Inflation Association said that China was going to dump the dollar because of the government increasing the money supply and knocking down the value of the dollar. What happened? I'll tell you what happened. These guys were wrong. I would be really mad if I was an investor that got sucked into the political ideology of these gold bugs. When the entire world economy is in trouble, what does everybody run to? The US dollar as we have seen over the last several weeks.
The greatest inflationary indicator since 1967, the CRB index is in a strong downtrend. But gold bugs like the National Inflation Association said that hyperinflation would be a huge problem by the end of 2011 and in 2012 China would dump the dollar as hyperinflation would continue to push the US dollar closer and closer to a 0 value. Again, inflation is no longer a risk as we continue in a deflationary environment. Global demand has slowed causing the price in energy and food to plunge downward. Hyperinflation by the end of 2011, what a joke and what a sucker you are if you bought into it. Folks, just add the CRB index along with DBO and DBA to your own stock watch list. Look at the charts yourself and don't let some slick gold salesman put bullsh*t into your head.
Fundamental analysis reports that moved markets last week were: Tuesday's Housing Starts and the FOMC Meeting Announcements on Tuesday and Wednesday of last week.
Housing starts did better than expected with a reading of 0.62 versus the consensus of 0.59
The big market moving news though was the FOMC Meeting where the Fed kept policy rates unchanged and exceptionally low but the Fed also decided to engage in "Operation Twist." The fed funds target remains at a range of zero to 0.25 percent. As many expected, the Fed announced it will be extending the average maturity of its purchases of Treasuries-a version of the so-called "Operation Twist." The Fed also will resume purchases of agency mortgage-backed securities. The statement retained language that rates will remain exceptionally low through mid-2013.
There were three dissenting votes. Voting against the action were Richard W. Fisher (Dallas), Narayana Kocherlakota (Minneapolis), and Charles I. Plosser (Philadelphia), who did not support additional policy accommodation at this time.
The FOMC decided to try to lower longer-term credit costs by raising its purchases of longer maturity Treasuries and more agency debt.
This will have an adverse effect on REITs and banks as the spread between short term rates and long term rates narrows. Any business that makes money by borrowing at short term rates and loaning at longer term rates will have their profits negatively impacted.
Fundamental analysis reports with the greatest probability of moving markets next week are:
Wednesday - September 28, 2011 = Durable Goods Orders
Thursday - September 29, 2011 = GDP
Friday - September 30, 2011 = Personal Income and Outlays
The Dow, S&P 500, and Russell 2000 are all in strong downtrends. The NASDAQ is holding up slightly better but even it is in a week downtrend. According to the major indices, the Bears have a strong advantage over the Bulls going into trading next week.
Now let's look at some market internals and see if they confirm my Bears on top thesis.
The percentage of stocks on the New York Stock Exchange that are trading above their 50 day moving average is 12%. Anything below 50% is bearish. The percentage of stocks on the New York Stock Exchange that are trading above their 200 day moving average is 14%. Again, this shows a strong bearish bias.
The NASDAQ Advance Decline Volume index clearly shows greater volume on selling days. Folks, again this shows a bearish bias. Think of volume as a measure of emotion. The emotional intensity is stronger in the Bear camp. Another way to say that is that Bears are more passionate in their belief that this market is going lower, than Bulls are in their belief that the market is going to go higher.
The ratio chart of the number of new lows to the total number of stocks traded on the NYSE is rising. In fact, it's risen to its highest level since breaking above the 0.025 line since January of 2008. Conversely, the amount of new highs being made has fallen to its lowest level after breaking the 0.025 line since January of 2008. This is bearish.
The Vix is in a strong uptrend. The Vix has been the best leading indicator for the trend in the market. Last week, I called into question the uptrend rating on the major indices because of the strong uptrend on the Vix. It just seemed too strange to have put buying trending upward at the same time the market was going upward. As I stated in last week's video, either the Vix was going to crash and fall in line with the market or the market was going to crash to fall in line with the Vix. As we now know, it was the market that crashed to fall in line with the Vix. Not only is the Vix in a strong uptrend which is bearish for this market, but the Resurrection Cross of the 50 day moving average crossing above the 200 day moving average has been confirmed. The Vix clearly supports my thesis that the Bears have an advantage over the Bulls going into trading next week.
Gold is in a weak downtrend. It has been downgraded from last week's sidelines rating. In last week's video what did I tell you the trend in gold was, sidelines right? I said you should move to the sidelines after booking your profits. If gold broke below the 50 day moving average, you would be glad that you sold out. If gold bounced off the 50 day moving average you could always get back in when it goes into a strong uptrend. Now a lot of you listening to my videos did not follow my advice. Bad move. Are you going to be a dummy and ride gold all the way down again? How do you know that this pullback in gold is not going to be another 2006 to 2007 plunge in gold? It took most gold bugs 2 to 3 years to recover their losses. Are you doomed to repeat the same mistake twice?
As a gold bug, why do you have to suffer these huge drawdowns? The answer is you don't. I don't care what your logic is. If you hold gold and it drops more than 20% on you, you are a failed trader and you are not trading right. Now the logic of some gold bugs is to say Lance, I don't care what you say. I subscribe to Doug Casey, Peter Schiff, and Peter DeGraff and these guys are all in. If they're all in gold then I'm all in gold. Because these guys are millionaires and billionaires and they didn't get that way from being stupid in their trading. They know how to trade, that's why they're rich. This is simply not true. These guys made their money not from their stock trading but from there gold bug newsletters and if they manage a fund like Peter Schiff. In other words they make their money from the businesses that they run and not their stock trading. Think about it. Why deal with the headaches of a business if you could be a millionaire and billionaire just from your stock trading?-- just from the point and click of a mouse. Why deal with taxes, a business license, hiring someone to answer the phones, advertising, employees, laws, customer service, processing customer credit cards and payments, and the dozens of other headaches it takes to run your own business? If these guys really were millionaires and billionaires just from their stock trading, they wouldn't need your $100, $400, or $1,000 a year to subscribe to their newsletters. The truth is they haven't become millionaires and billionaires from their stock trading. They need your money. The other argument I've gotten from gold bugs is well, Lance, you can't buy bottoms. I totally agree with that. In fact, I'll expand on that and say you can't buy bottoms or sell tops. But that line of logic applied to holding onto gold too long is what's called a non-sequitur. Some might call it a straw man. It's taking a truth in some other aspect of trading and applying it in an illogical way to gold. Sure you can't buy bottoms and sell tops, but you can trade trends. Holding onto gold for too long and suffering huge drawdowns, and not setting a stop loss, and then justifying those huge drawdowns with the logic that you can't buy bottoms and sell tops is dumb. You can trade the trend. Simply establish the trend and then trade it.
Silver is in a strong downtrend. Silver is in worse shape than gold.
The US dollar is in a strong uptrend. It broke above the 200 day moving average in the first part of September, retraced testing the 200 day moving average again which held, and then rocketed off of it. We are also getting closer and closer to a Resurrection Cross where the 50 day moving average crosses above the 200 day moving average. We don't have that yet but we continue to move closer to it. Wait a second! I thought Peter Schiff said a couple years ago that the dollar was going to go worthless. In the best case scenario, he said, gold was going back to 50. According to Doug Casey, Peter Schiff, Mark Skousen, and other Republican ideologues and gold bugs, the dollar was going to go worthless. The policies of the Democrat government were causing the value of the dollar to go down. They were just printing more money. Republicans coined the term "helicopter Ben". The National Inflation Association said that China was going to dump the dollar because of the government increasing the money supply and knocking down the value of the dollar. What happened? I'll tell you what happened. These guys were wrong. I would be really mad if I was an investor that got sucked into the political ideology of these gold bugs. When the entire world economy is in trouble, what does everybody run to? The US dollar as we have seen over the last several weeks.
The greatest inflationary indicator since 1967, the CRB index is in a strong downtrend. But gold bugs like the National Inflation Association said that hyperinflation would be a huge problem by the end of 2011 and in 2012 China would dump the dollar as hyperinflation would continue to push the US dollar closer and closer to a 0 value. Again, inflation is no longer a risk as we continue in a deflationary environment. Global demand has slowed causing the price in energy and food to plunge downward. Hyperinflation by the end of 2011, what a joke and what a sucker you are if you bought into it. Folks, just add the CRB index along with DBO and DBA to your own stock watch list. Look at the charts yourself and don't let some slick gold salesman put bullsh*t into your head.
Fundamental analysis reports that moved markets last week were: Tuesday's Housing Starts and the FOMC Meeting Announcements on Tuesday and Wednesday of last week.
Housing starts did better than expected with a reading of 0.62 versus the consensus of 0.59
The big market moving news though was the FOMC Meeting where the Fed kept policy rates unchanged and exceptionally low but the Fed also decided to engage in "Operation Twist." The fed funds target remains at a range of zero to 0.25 percent. As many expected, the Fed announced it will be extending the average maturity of its purchases of Treasuries-a version of the so-called "Operation Twist." The Fed also will resume purchases of agency mortgage-backed securities. The statement retained language that rates will remain exceptionally low through mid-2013.
There were three dissenting votes. Voting against the action were Richard W. Fisher (Dallas), Narayana Kocherlakota (Minneapolis), and Charles I. Plosser (Philadelphia), who did not support additional policy accommodation at this time.
The FOMC decided to try to lower longer-term credit costs by raising its purchases of longer maturity Treasuries and more agency debt.
This will have an adverse effect on REITs and banks as the spread between short term rates and long term rates narrows. Any business that makes money by borrowing at short term rates and loaning at longer term rates will have their profits negatively impacted.
Fundamental analysis reports with the greatest probability of moving markets next week are:
Wednesday - September 28, 2011 = Durable Goods Orders
Thursday - September 29, 2011 = GDP
Friday - September 30, 2011 = Personal Income and Outlays
The Dow, S&P 500, and Russell 2000 are all in strong downtrends. The NASDAQ is holding up slightly better but even it is in a week downtrend. According to the major indices, the Bears have a strong advantage over the Bulls going into trading next week.
Now let's look at some market internals and see if they confirm my Bears on top thesis.
The percentage of stocks on the New York Stock Exchange that are trading above their 50 day moving average is 12%. Anything below 50% is bearish. The percentage of stocks on the New York Stock Exchange that are trading above their 200 day moving average is 14%. Again, this shows a strong bearish bias.
The NASDAQ Advance Decline Volume index clearly shows greater volume on selling days. Folks, again this shows a bearish bias. Think of volume as a measure of emotion. The emotional intensity is stronger in the Bear camp. Another way to say that is that Bears are more passionate in their belief that this market is going lower, than Bulls are in their belief that the market is going to go higher.
The ratio chart of the number of new lows to the total number of stocks traded on the NYSE is rising. In fact, it's risen to its highest level since breaking above the 0.025 line since January of 2008. Conversely, the amount of new highs being made has fallen to its lowest level after breaking the 0.025 line since January of 2008. This is bearish.
The Vix is in a strong uptrend. The Vix has been the best leading indicator for the trend in the market. Last week, I called into question the uptrend rating on the major indices because of the strong uptrend on the Vix. It just seemed too strange to have put buying trending upward at the same time the market was going upward. As I stated in last week's video, either the Vix was going to crash and fall in line with the market or the market was going to crash to fall in line with the Vix. As we now know, it was the market that crashed to fall in line with the Vix. Not only is the Vix in a strong uptrend which is bearish for this market, but the Resurrection Cross of the 50 day moving average crossing above the 200 day moving average has been confirmed. The Vix clearly supports my thesis that the Bears have an advantage over the Bulls going into trading next week.
Gold is in a weak downtrend. It has been downgraded from last week's sidelines rating. In last week's video what did I tell you the trend in gold was, sidelines right? I said you should move to the sidelines after booking your profits. If gold broke below the 50 day moving average, you would be glad that you sold out. If gold bounced off the 50 day moving average you could always get back in when it goes into a strong uptrend. Now a lot of you listening to my videos did not follow my advice. Bad move. Are you going to be a dummy and ride gold all the way down again? How do you know that this pullback in gold is not going to be another 2006 to 2007 plunge in gold? It took most gold bugs 2 to 3 years to recover their losses. Are you doomed to repeat the same mistake twice?
As a gold bug, why do you have to suffer these huge drawdowns? The answer is you don't. I don't care what your logic is. If you hold gold and it drops more than 20% on you, you are a failed trader and you are not trading right. Now the logic of some gold bugs is to say Lance, I don't care what you say. I subscribe to Doug Casey, Peter Schiff, and Peter DeGraff and these guys are all in. If they're all in gold then I'm all in gold. Because these guys are millionaires and billionaires and they didn't get that way from being stupid in their trading. They know how to trade, that's why they're rich. This is simply not true. These guys made their money not from their stock trading but from there gold bug newsletters and if they manage a fund like Peter Schiff. In other words they make their money from the businesses that they run and not their stock trading. Think about it. Why deal with the headaches of a business if you could be a millionaire and billionaire just from your stock trading?-- just from the point and click of a mouse. Why deal with taxes, a business license, hiring someone to answer the phones, advertising, employees, laws, customer service, processing customer credit cards and payments, and the dozens of other headaches it takes to run your own business? If these guys really were millionaires and billionaires just from their stock trading, they wouldn't need your $100, $400, or $1,000 a year to subscribe to their newsletters. The truth is they haven't become millionaires and billionaires from their stock trading. They need your money. The other argument I've gotten from gold bugs is well, Lance, you can't buy bottoms. I totally agree with that. In fact, I'll expand on that and say you can't buy bottoms or sell tops. But that line of logic applied to holding onto gold too long is what's called a non-sequitur. Some might call it a straw man. It's taking a truth in some other aspect of trading and applying it in an illogical way to gold. Sure you can't buy bottoms and sell tops, but you can trade trends. Holding onto gold for too long and suffering huge drawdowns, and not setting a stop loss, and then justifying those huge drawdowns with the logic that you can't buy bottoms and sell tops is dumb. You can trade the trend. Simply establish the trend and then trade it.
Silver is in a strong downtrend. Silver is in worse shape than gold.
The US dollar is in a strong uptrend. It broke above the 200 day moving average in the first part of September, retraced testing the 200 day moving average again which held, and then rocketed off of it. We are also getting closer and closer to a Resurrection Cross where the 50 day moving average crosses above the 200 day moving average. We don't have that yet but we continue to move closer to it. Wait a second! I thought Peter Schiff said a couple years ago that the dollar was going to go worthless. In the best case scenario, he said, gold was going back to 50. According to Doug Casey, Peter Schiff, Mark Skousen, and other Republican ideologues and gold bugs, the dollar was going to go worthless. The policies of the Democrat government were causing the value of the dollar to go down. They were just printing more money. Republicans coined the term "helicopter Ben". The National Inflation Association said that China was going to dump the dollar because of the government increasing the money supply and knocking down the value of the dollar. What happened? I'll tell you what happened. These guys were wrong. I would be really mad if I was an investor that got sucked into the political ideology of these gold bugs. When the entire world economy is in trouble, what does everybody run to? The US dollar as we have seen over the last several weeks.
The greatest inflationary indicator since 1967, the CRB index is in a strong downtrend. But gold bugs like the National Inflation Association said that hyperinflation would be a huge problem by the end of 2011 and in 2012 China would dump the dollar as hyperinflation would continue to push the US dollar closer and closer to a 0 value. Again, inflation is no longer a risk as we continue in a deflationary environment. Global demand has slowed causing the price in energy and food to plunge downward. Hyperinflation by the end of 2011, what a joke and what a sucker you are if you bought into it. Folks, just add the CRB index along with DBO and DBA to your own stock watch list. Look at the charts yourself and don't let some slick gold salesman put bullsh*t into your head.
Fundamental analysis reports that moved markets last week were: Tuesday's Housing Starts and the FOMC Meeting Announcements on Tuesday and Wednesday of last week.
Housing starts did better than expected with a reading of 0.62 versus the consensus of 0.59
The big market moving news though was the FOMC Meeting where the Fed kept policy rates unchanged and exceptionally low but the Fed also decided to engage in "Operation Twist." The fed funds target remains at a range of zero to 0.25 percent. As many expected, the Fed announced it will be extending the average maturity of its purchases of Treasuries-a version of the so-called "Operation Twist." The Fed also will resume purchases of agency mortgage-backed securities. The statement retained language that rates will remain exceptionally low through mid-2013.
There were three dissenting votes. Voting against the action were Richard W. Fisher (Dallas), Narayana Kocherlakota (Minneapolis), and Charles I. Plosser (Philadelphia), who did not support additional policy accommodation at this time.
The FOMC decided to try to lower longer-term credit costs by raising its purchases of longer maturity Treasuries and more agency debt.
This will have an adverse effect on REITs and banks as the spread between short term rates and long term rates narrows. Any business that makes money by borrowing at short term rates and loaning at longer term rates will have their profits negatively impacted.
Fundamental analysis reports with the greatest probability of moving markets next week are:
Wednesday - September 28, 2011 = Durable Goods Orders
Thursday - September 29, 2011 = GDP
Friday - September 30, 2011 = Personal Income and Outlays
If you follow me on Twitter then you know that today I put up on GuerillaStockTrading.com a bunch of new short ETF picks.
Now some of you guys might be thinking that I'm crazy because I added like four of them. The stock picks are Direxion Daily Small Cap Bear 3X Shares (TZA), Direxion Daily Real Estate Bear 3X Shrs (DRV), Direxion Daily Financial Bear 3X Shares (FAZ), Direxion Daily Energy Bear 3X Shares (ERY), and Direxion Daily Large Cap Bear 3X Shares (BGZ).
To explain to you what I'm doing, I'm going to show you the world's best stock screener. In the video below you'll see a stock screen that I ran for weekly buy trade triangles across the entire stock market. Using the stock screener in this way lets you see across the entire stock market and all sectors and you can see what institutional traders are doing. Think of it like this. Amateur traders like you and me cannot move the stock market like this. We don't have enough money, or buying power, to move entire sectors. So when you see a common theme of many different sectors all doing the same thing, that's a huge signal for what institutional traders, money managers, and hedge funds are doing.
This is an incredible way to scan the entire stock market. This scan I'm going to show you in the video below really gave me confidence in the video I did last night where I sounded the bear alarm.
If you follow me on Twitter then you know that today I put up on GuerillaStockTrading.com a bunch of new short ETF picks.
Now some of you guys might be thinking that I'm crazy because I added like four of them. The stock picks are Direxion Daily Small Cap Bear 3X Shares (TZA), Direxion Daily Real Estate Bear 3X Shrs (DRV), Direxion Daily Financial Bear 3X Shares (FAZ), Direxion Daily Energy Bear 3X Shares (ERY), and Direxion Daily Large Cap Bear 3X Shares (BGZ).
To explain to you what I'm doing, I'm going to show you the world's best stock screener. In the video below you'll see a stock screen that I ran for weekly buy trade triangles across the entire stock market. Using the stock screener in this way lets you see across the entire stock market and all sectors and you can see what institutional traders are doing. Think of it like this. Amateur traders like you and me cannot move the stock market like this. We don't have enough money, or buying power, to move entire sectors. So when you see a common theme of many different sectors all doing the same thing, that's a huge signal for what institutional traders, money managers, and hedge funds are doing.
This is an incredible way to scan the entire stock market. This scan I'm going to show you in the video below really gave me confidence in the video I did last night where I sounded the bear alarm.
You need to get your hands on this tool! Click HERE to get a trial of the world's best stock screener.You need to get your hands on this tool! Click HERE to get a trial of the world's best stock screener.
If you follow me on Twitter then you know that today I put up on GuerillaStockTrading.com a bunch of new short ETF picks.
Now some of you guys might be thinking that I'm crazy because I added like four of them. The stock picks are Direxion Daily Small Cap Bear 3X Shares (TZA), Direxion Daily Real Estate Bear 3X Shrs (DRV), Direxion Daily Financial Bear 3X Shares (FAZ), Direxion Daily Energy Bear 3X Shares (ERY), and Direxion Daily Large Cap Bear 3X Shares (BGZ).
To explain to you what I'm doing, I'm going to show you the world's best stock screener. In the video below you'll see a stock screen that I ran for weekly buy trade triangles across the entire stock market. Using the stock screener in this way lets you see across the entire stock market and all sectors and you can see what institutional traders are doing. Think of it like this. Amateur traders like you and me cannot move the stock market like this. We don't have enough money, or buying power, to move entire sectors. So when you see a common theme of many different sectors all doing the same thing, that's a huge signal for what institutional traders, money managers, and hedge funds are doing.
This is an incredible way to scan the entire stock market. This scan I'm going to show you in the video below really gave me confidence in the video I did last night where I sounded the bear alarm.
You need to get your hands on this tool! Click HERE to get a trial of the world's best stock screener.You need to get your hands on this tool! Click HERE to get a trial of the world's best stock screener.
Greece is going to be in the news next week and folks, you need to keep your eyes on what happens.
This Monday Greece will seek to persuade its lenders that it deserves another €8 billion loan. On the battlefield will be the Greek finance minister Evangelos Venizelos, versus the troika that crafted the €109 billion loan last year.
Greece is going to be trying to prove that they are delivering the budget cuts and fiscal reforms mandated by the €109 billion loan last year. The problems that Greece is going to have is the fact that their economy has shrunk by over 7% from last year due to the current global recession. This slowdown has cut into tax revenues and has created an even bigger fiscal gap for Athens to have to close.
Remember that big property tax that Greece announced last week that made markets rally? Eurozone ministers over the weekend lowered revenue estimates for that proposed property tax which the Greek government had said would raise about €2 billion a year in 2011 and 2012. It's not going to raise that much. The recession and global slowdown has cut into those property tax revenue estimates.
Make no mistake folks, this meeting on Monday is big news. It's so critical that the Greek Prime Minister George Papandreou canceled his planned trip to Washington in order to oversee a "particularly critical" week in his countries fight to avoid bankruptcy as reported by the Financial Times. George Papandreou held an emergency cabinet meeting on Sunday, just a few hours ago, to discuss more emergency cuts in spending to meet the fiscal targets and secure the release of the next bailout tranche.
Greece needs this money bad and they need it right now. Greek officials estimate they have enough cash for the remainder of this month and perhaps the first 10 days of October. But after that there will be big problems with meeting even basic government obligations like pensions and salaries.
Now here is how we can play this Greek crisis for profits. There is no Greek ETF but what we can do is short other ETFs.
Here are three companies to put on your stock watch list if you want to short Greece.
Guggenheim Shipping (SEA) is a shipping ETF that we can short because it has a fairly high percent of its holdings in Greek shipping companies. The stock chart shows that the price is right at the top of a trend channel and it looks ready to roll over and head down. The RSI is signaling that this stock is overbought.
Another short candidate is the iShares MSCI Europe Financials Index (EUFN). This ETF has a larger percent of its holdings in Greek companies. The chart shows that it's at critical resistance right up against the 20 day moving average. We have a doji candlestick, that formed Friday, right against that 20 day moving average which makes the stock look like it's ready to roll over and take the next leg down.
The third stock you should put on your watch list as a short candidate is the iShares MSCI Italy Index (EWI). Notice that these charts in many ways look exactly the same. The chart shows a big red candlestick that formed on Friday right up against the 20 day moving average resistance level. The RSI has already broken below the 0.8 line suggesting this chart will roll over and take the next leg down next week.
So add these three stocks to your watch list and keep your eyes peeled on Monday. If Greece can't convince the EU that they are making the necessary spending cuts and tax revenue increases to continue to make payments against their existing debt, they may have to declare bankruptcy and these stocks will be good shorts.
Greece is going to be in the news next week and folks, you need to keep your eyes on what happens.
This Monday Greece will seek to persuade its lenders that it deserves another €8 billion loan. On the battlefield will be the Greek finance minister Evangelos Venizelos, versus the troika that crafted the €109 billion loan last year.
Greece is going to be trying to prove that they are delivering the budget cuts and fiscal reforms mandated by the €109 billion loan last year. The problems that Greece is going to have is the fact that their economy has shrunk by over 7% from last year due to the current global recession. This slowdown has cut into tax revenues and has created an even bigger fiscal gap for Athens to have to close.
Remember that big property tax that Greece announced last week that made markets rally? Eurozone ministers over the weekend lowered revenue estimates for that proposed property tax which the Greek government had said would raise about €2 billion a year in 2011 and 2012. It's not going to raise that much. The recession and global slowdown has cut into those property tax revenue estimates.
Make no mistake folks, this meeting on Monday is big news. It's so critical that the Greek Prime Minister George Papandreou canceled his planned trip to Washington in order to oversee a "particularly critical" week in his countries fight to avoid bankruptcy as reported by the Financial Times. George Papandreou held an emergency cabinet meeting on Sunday, just a few hours ago, to discuss more emergency cuts in spending to meet the fiscal targets and secure the release of the next bailout tranche.
Greece needs this money bad and they need it right now. Greek officials estimate they have enough cash for the remainder of this month and perhaps the first 10 days of October. But after that there will be big problems with meeting even basic government obligations like pensions and salaries.
Now here is how we can play this Greek crisis for profits. There is no Greek ETF but what we can do is short other ETFs.
Here are three companies to put on your stock watch list if you want to short Greece.
Guggenheim Shipping (SEA) is a shipping ETF that we can short because it has a fairly high percent of its holdings in Greek shipping companies. The stock chart shows that the price is right at the top of a trend channel and it looks ready to roll over and head down. The RSI is signaling that this stock is overbought.
Another short candidate is the iShares MSCI Europe Financials Index (EUFN). This ETF has a larger percent of its holdings in Greek companies. The chart shows that it's at critical resistance right up against the 20 day moving average. We have a doji candlestick, that formed Friday, right against that 20 day moving average which makes the stock look like it's ready to roll over and take the next leg down.
The third stock you should put on your watch list as a short candidate is the iShares MSCI Italy Index (EWI). Notice that these charts in many ways look exactly the same. The chart shows a big red candlestick that formed on Friday right up against the 20 day moving average resistance level. The RSI has already broken below the 0.8 line suggesting this chart will roll over and take the next leg down next week.
So add these three stocks to your watch list and keep your eyes peeled on Monday. If Greece can't convince the EU that they are making the necessary spending cuts and tax revenue increases to continue to make payments against their existing debt, they may have to declare bankruptcy and these stocks will be good shorts.
Greece is going to be in the news next week and folks, you need to keep your eyes on what happens.
This Monday Greece will seek to persuade its lenders that it deserves another €8 billion loan. On the battlefield will be the Greek finance minister Evangelos Venizelos, versus the troika that crafted the €109 billion loan last year.
Greece is going to be trying to prove that they are delivering the budget cuts and fiscal reforms mandated by the €109 billion loan last year. The problems that Greece is going to have is the fact that their economy has shrunk by over 7% from last year due to the current global recession. This slowdown has cut into tax revenues and has created an even bigger fiscal gap for Athens to have to close.
Remember that big property tax that Greece announced last week that made markets rally? Eurozone ministers over the weekend lowered revenue estimates for that proposed property tax which the Greek government had said would raise about €2 billion a year in 2011 and 2012. It's not going to raise that much. The recession and global slowdown has cut into those property tax revenue estimates.
Make no mistake folks, this meeting on Monday is big news. It's so critical that the Greek Prime Minister George Papandreou canceled his planned trip to Washington in order to oversee a "particularly critical" week in his countries fight to avoid bankruptcy as reported by the Financial Times. George Papandreou held an emergency cabinet meeting on Sunday, just a few hours ago, to discuss more emergency cuts in spending to meet the fiscal targets and secure the release of the next bailout tranche.
Greece needs this money bad and they need it right now. Greek officials estimate they have enough cash for the remainder of this month and perhaps the first 10 days of October. But after that there will be big problems with meeting even basic government obligations like pensions and salaries.
Now here is how we can play this Greek crisis for profits. There is no Greek ETF but what we can do is short other ETFs.
Here are three companies to put on your stock watch list if you want to short Greece.
Guggenheim Shipping (SEA) is a shipping ETF that we can short because it has a fairly high percent of its holdings in Greek shipping companies. The stock chart shows that the price is right at the top of a trend channel and it looks ready to roll over and head down. The RSI is signaling that this stock is overbought.
Another short candidate is the iShares MSCI Europe Financials Index (EUFN). This ETF has a larger percent of its holdings in Greek companies. The chart shows that it's at critical resistance right up against the 20 day moving average. We have a doji candlestick, that formed Friday, right against that 20 day moving average which makes the stock look like it's ready to roll over and take the next leg down.
The third stock you should put on your watch list as a short candidate is the iShares MSCI Italy Index (EWI). Notice that these charts in many ways look exactly the same. The chart shows a big red candlestick that formed on Friday right up against the 20 day moving average resistance level. The RSI has already broken below the 0.8 line suggesting this chart will roll over and take the next leg down next week.
So add these three stocks to your watch list and keep your eyes peeled on Monday. If Greece can't convince the EU that they are making the necessary spending cuts and tax revenue increases to continue to make payments against their existing debt, they may have to declare bankruptcy and these stocks will be good shorts.
The market gave us an awesome peek into the secret world of the institutional trader today. It's all about Europe with institutional traders.
Look at what happened on the Russell 2000 and all the major indices as we went into the last hour of trading today: a huge explosion upward. Massive buy side volume hit the market pushing the market up to close at its high.
What caused this massive buying in the last hour of trading? The Financial Times reported that China is looking at buying some of Italy's debt and investing in some oversold companies that are trading at bargain prices right now.
Institutional traders absolutely loved this news and the market exploded upward. If China denies this rumor or says no to buying some of Italy's bonds, expect the market to sell off.
Here's how I'm playing this. I went long the Direxion Daily Small Cap Bull 3X Shares (TNA) right before market close today. I'd like to get a good gap up open and then exit in a day or two for some quick profits.
This bounce today off the lower channel wall of the Bearish Flag patterns means that panic selling is avoided for yet another day. The market bounced off previous support and the gamble in TNA is that it'll go into a swing move up from here.
I also like the long tail that formed on the candlestick today on the S&P 500. Long tails like this are typical at swing move highs and at swing move lows.
This is a very risky gambit. Keep that lower trend channel wall in view and if the market breaks that support on heavy volume, you'll need to get out of TNA fast as it's a 3x leverage play.
The market gave us an awesome peek into the secret world of the institutional trader today. It's all about Europe with institutional traders.
Look at what happened on the Russell 2000 and all the major indices as we went into the last hour of trading today: a huge explosion upward. Massive buy side volume hit the market pushing the market up to close at its high.
What caused this massive buying in the last hour of trading? The Financial Times reported that China is looking at buying some of Italy's debt and investing in some oversold companies that are trading at bargain prices right now.
Institutional traders absolutely loved this news and the market exploded upward. If China denies this rumor or says no to buying some of Italy's bonds, expect the market to sell off.
Here's how I'm playing this. I went long the Direxion Daily Small Cap Bull 3X Shares (TNA) right before market close today. I'd like to get a good gap up open and then exit in a day or two for some quick profits.
This bounce today off the lower channel wall of the Bearish Flag patterns means that panic selling is avoided for yet another day. The market bounced off previous support and the gamble in TNA is that it'll go into a swing move up from here.
I also like the long tail that formed on the candlestick today on the S&P 500. Long tails like this are typical at swing move highs and at swing move lows.
This is a very risky gambit. Keep that lower trend channel wall in view and if the market breaks that support on heavy volume, you'll need to get out of TNA fast as it's a 3x leverage play.
The market gave us an awesome peek into the secret world of the institutional trader today. It's all about Europe with institutional traders.
Look at what happened on the Russell 2000 and all the major indices as we went into the last hour of trading today: a huge explosion upward. Massive buy side volume hit the market pushing the market up to close at its high.
What caused this massive buying in the last hour of trading? The Financial Times reported that China is looking at buying some of Italy's debt and investing in some oversold companies that are trading at bargain prices right now.
Institutional traders absolutely loved this news and the market exploded upward. If China denies this rumor or says no to buying some of Italy's bonds, expect the market to sell off.
Here's how I'm playing this. I went long the Direxion Daily Small Cap Bull 3X Shares (TNA) right before market close today. I'd like to get a good gap up open and then exit in a day or two for some quick profits.
This bounce today off the lower channel wall of the Bearish Flag patterns means that panic selling is avoided for yet another day. The market bounced off previous support and the gamble in TNA is that it'll go into a swing move up from here.
I also like the long tail that formed on the candlestick today on the S&P 500. Long tails like this are typical at swing move highs and at swing move lows.
This is a very risky gambit. Keep that lower trend channel wall in view and if the market breaks that support on heavy volume, you'll need to get out of TNA fast as it's a 3x leverage play.
Copyright 2009-2011 GuerillaStockTrading.com All rights reserved. No part or article on this website may be copied or duplicated without written consent from GuerillaStockTrading.com and Confab Publishing. Disclaimer: This Web site is designed to provide accurate and authoritative information on the subject of personal finances. It is provided with the understanding that neither the author nor the publisher is engaged in rendering legal, accounting, or other professional services by providing this Web site. The authors and publisher shall not be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential or other damages. As each individual situation is unique, questions relevant to personal finances and specific to the individual should be addressed to an appropriate professional to ensure that the situation has been carefully and appropriately evaluated. This blog is for information and entertainment purposes only. Under no circumstances does this information represent a recommendation to buy or sell securities or any other type of investment instruments. See a licensed broker for investment advice.
The Dow, S&P 500, Nasdaq, and Russell 2000 are all in uptrends. So according to the trends of the major indices, the bulls have an advantage over the bears going into trading next week.
Wow folks, unbelievable! What a difference a day makes! Major damage was done to the bull camp today. In fact, the bulls no longer have an advantage over the bears. We've fallen back into the dreaded trading range.
The Dow, S&P 500, and Russell 2000 are all in strong downtrends. The NASDAQ is holding up slightly better but even it is in a week downtrend. According to the major indices, the Bears have a strong advantage over the Bulls going into trading next week.
If you follow me on Twitter then you know that today I put up on GuerillaStockTrading.com a bunch of new short ETF picks.
Greece is going to be in the news next week and folks, you need to keep your eyes on what happens.
The market gave us an awesome peek into the secret world of the institutional trader today. It's all about Europe with institutional traders. 
Guerilla Stock Trading University