amoeba's Account Talk

[FogSailing]

What a horrendous week. I think we've moved beyond stick pants anxiety to downright crappie pants territory. I am not looking forward to Asia markets opening on Sunday night. I hope this isn't a 1750 SPX event....but it could be.

Hoping for something for the give this market a positive bounce for 2016.

FS

 

[nnuut]

The farther DOWN we go The farther up the Markets can rebound, I'm waiting for the REAL turn around.

 

[amoeba]

I think some patience may be in order; I'm looking at around 1,800 or less in the SPY for a bottoming at this point, and no more than 1,850.

Still waiting (BTW - I've been out skiing since 1/10/16, and had no access to internet during that time; very refreshing):

Although 1/15/16 SPY volume was healthy (324 million shares), it pales in comparison to the 504 million shares traded last August 24 at a similar closing price (1,871). The next couple days following that were big snap-back buys, that confirmed the bear fake-out.

Until now. The data appear to show the primary influence to be waning earnings (and/or earnings growth) compounded by weakening energy prices. I'm not sure what will change the sentiment in this background. Lower market prices may help but at what level?

If anyone knows better than my last call (quote above) - please chime in.

 

[amoeba]

Market reaction appears to be emotional based on Draghi comments and, IMO, will not last through next Monday (1/25/16); if it even gets through this afternoon in positive territory:

Reality is that oil inventories showed a build of 4 million barrels, and distillates, while 1 million less than last week - remain at the upper end of the average range. UPRR got toasted today on Q4.

In other words - what we have here is a selling opportunity for anyone who wants to cash out before the true bottoming to come.

 

[amoeba]

Still highly emotional market today (1/22/16):

AGG volume spiked to 7 million yesterday; the prior two peaks of 12 and 10 million shares on October 30 and November 9, 2015, preceded a 10% correction; but now we're in the reverse, or maybe we're not. ^VIX has dropped to ~23 as of this writing, but remains above the 50 EMA (~20); if it clearly falls below 20 Monday (not like 9/21/15 or 12/16/15, when there was a touch and go) - this could be some kind of a short-term multi-day rally lasting into the FED's comments (I believe later next week).

There could also be some greater short-sale activity, either on oil or broader market futures, affecting today's action. In any case, the close is some hours away. The day ain't over till its over.

 

[Dorado]

Hey Amoeba
I stopped by twice this week and you weren't in. I'll try again. I'm hoping this year I can actually do a better job of remembering to update my allotments on the Tracker, yet already I'm off kilter.

 

[amoeba]

Hey Amoeba
I stopped by twice this week and you weren't in. I'll try again. I'm hoping this year I can actually do a better job of remembering to update my allotments on the Tracker, yet already I'm off kilter.

I was in the GIS lab doing work for a change and before that, skiing in Utah for 8 days; I'll stop by your side of the building soon. I'll give you the "low down" on my recent TSP (in)activity. I need to talk to you about where you left off on levee grouting anyway.

 

[FogSailing]

Good analysis Amoeba. Given the extreme nature of stocks oversold my guess is that we bounce up on Monday and perhaps again on Tuesday ahead of the Fed minutes. All of that is premised on oil prices not declining or some major event derailing the rally. Regardless, I don't think we rally above 1970. I know that if we were to get a 2.168 Fib retracement you would be at 2182 but I'm not feeling that luck these days. If Fed is neutral on Wednesday, the market "might" have another day up ,,,,.. but more likely we begin to pull back BECAUSE my experience this year has been whenever the Fed talks, the markets seem to tank.

FS

 

[amoeba]

Can't pull the trigger yet; these fake-out upticks just before the IFT deadline are rattling; yet - volatility remains high and there's always a chance of some wild money out there betting on FED comments tomorrow. Nothing rational. Finger off the button. Wait and see.

 

[amoeba]

Good analysis Amoeba. Given the extreme nature of stocks oversold my guess is that we bounce up on Monday and perhaps again on Tuesday ahead of the Fed minutes. All of that is premised on oil prices not declining or some major event derailing the rally. Regardless, I don't think we rally above 1970. I know that if we were to get a 2.168 Fib retracement you would be at 2182 but I'm not feeling that luck these days. If Fed is neutral on Wednesday, the market "might" have another day up ,,,,.. but more likely we begin to pull back BECAUSE my experience this year has been whenever the Fed talks, the markets seem to tank.

FS

Well - today's late selloff implies somebody (thinks they) knows something about what the FED has to say tomorrow - and it is likely not good. The 20 EMA on ^VIX has been lost, again. What's different is the market decline is on much lower volume than a few days ago; not yet the washout that some had been expecting, myself included. Give me that minus 3-5% gap open, some reason to wade in. This steady decline into oblivion doesn't make me feel all warm and fuzzy about risk-taking.

 

[amoeba]

Read the FED minutes:

More rate hikes coming; data is positive. Markets are being thumped by misses by AAPL and larger selloffs of biotech, emerging markets, and the like. I am making a small bottom fishing bet on this yesterday, doubling down today, in the hopes I can catch the front end of a bear flag and late January seasonality (see those 70% positive days on Tom's commentary?) if not more. I think the reaction to the FED could be overdone, but there are other factors besides that.

 

[FogSailing]

Hi Amoeba: I think we are at another key turning point. I think we move at one direction or another in a powerful way, maybe as early as tomorrow.. We started all this craziness at 2082. If we head down again and drop below 1812 by next Tuesday, I think 1750 in looking us square on. We dropped 270 points from 2082-1812. In any case, I had been expecting up to 50% retracement from the 1812 low which would have taken us to the 1950-1960 area (I had thought this would begin on Monday. It didn't. However, Tuesdays rally moved us up nicely.).

However, the Tuesday high was 1917 SPX which is roughly 36% retracement of the 1812 (almost a 38 fib retracement - good enough for me anyway). So, the question to me is "Is the retracement done given that we fell to 1872 today as a low? The logical call is that we are in a bear market and we are headed further down. But the contrarian move says we could have a bounce tomorrow because there is a lot of money on the sidelines and they need to get it back in the market. So it is possible for a small rally up enough to make everyone comfortable, then stand by to see your hard earned dollars siphoned off by the smart money...so a short turnaround is possible before they pull the rug out.

I've been wanting to catch the bounce up but it hasn't materialized for us since last November. I'm starting to think the smart move is to stay out until we hit 1600 and then reassess. Our TSP tools are antiquated, very inflexible and fail to protect me from the volatility of this market. Oh well, hopefully get my cheery disposition back tomorrow.

All the best to you in your investing!

FS

 

[amoeba]

Jeepers:

Another mediocre volume, moderately-high volatility, news-of-the-day (FB beats, oil production cutback rumors - false as they are, Yellen before Congress) type trading. I'm feeling overhead resistance. Another big (AMZN) reports after hours, but then, we have Q4 GDP and the jobs report next week; which I believe will fall below expectations but not low enough to delay a March rate hike. The non-durables December miss concerns me. Auto/truck sales next week could beat, but then, some of that is an inverse to oil.

I'm gonna have to agree with Fogsailing at least in part; that lower market prices are more likely than higher in the near term.

In sum, I bailed.

Seeya in Feb.

 

[Lakebound]

Jeepers:

Another mediocre volume, moderately-high volatility, news-of-the-day (FB beats, oil production cutback rumors - false as they are, Yellen before Congress) type trading. I'm feeling overhead resistance. Another big (AMZN) reports after hours, but then, we have Q4 GDP and the jobs report next week; which I believe will fall below expectations but not low enough to delay a March rate hike. The non-durables December miss concerns me. Auto/truck sales next week could beat, but then, some of that is an inverse to oil.

I'm gonna have to agree with Fogsailing at least in part; that lower market prices are more likely than higher in the near term.

In sum, I bailed.

Seeya in Feb.

Wow! Good insight on your part. To play the part of the contrarian, I am staying in where I am just to have that "extra IFT" for February. I hope we both do well, I enjoy reading your opinions.

Best of luck,

Frank

 

[amoeba]

AMZN is going way up (7%+) ahead of earnings; which - apparently no one noticed - have faded down in estimates over the last 30 days; somebody wake me up when the P/E<100 on that company. Nothing less than a voluntary Ponzi scheme. It just doesn't warrant the stock price people are paying for it.

 

[amoeba]

AMZN is going way up (7%+) ahead of earnings; which - apparently no one noticed - have faded down in estimates over the last 30 days; somebody wake me up when the P/E<100 on that company. Nothing less than a voluntary Ponzi scheme. It just doesn't warrant the stock price people are paying for it.

Naturally, they just reported a huge miss ($1 buck even per share vs. $1.58 concensus faded estimate) and the stock is floundering, down -14% after hours as of this post. Stick a fork in that stock. Unfortunately, the market as a whole will react accordingly tomorrow morning.

 

[respro]

Naturally, they just reported a huge miss ($1 buck even per share vs. $1.58 concensus faded estimate) and the stock is floundering, down -14% after hours as of this post. Stick a fork in that stock. Unfortunately, the market as a whole will react accordingly tomorrow morning.

I agree. What I don't understand is why the buy up before earnings. Buying on pure hope?

 

[pmaloney]

I thing they were hoping that AMZN would go up as Facebook did the day before since it is one of the FANG high growth stocks but this type of report from AMZN. AMZN spent money building their transport and delivery system to make sure that they could fulfill their PRIME delivery commitments. AMZN often sacrifices profits for growth and development. Then they turn around and give a great quarter and people are ok. Great growth stock but too scary and expensive for me. :smile:

 

[amoeba]

Markets up in the face of oil declining off a rampant false rumor, bogus negative interest rate announcement in Japan, all of which IMO won't last much beyond the weekend:

Does anyone out there really believe that Saudi's are gonna cut back production? They didn't say so. Did oil inventories decline? No. Do you think that negative interest rates are sustainable? No. And AMZN miss by 1/3 on earnings? It's P/E is still north of 90.

This is BS trading and a bunch of hopers - there may be some kind of follow-through; but anyone who stays long will get what's coming to them. Pay attention. I say lower prices to come in all of the major indices.

 

[BooDog]

Markets up in the face of oil declining off a rampant false rumor, bogus negative interest rate announcement in Japan, all of which IMO won't last much beyond the weekend:

Does anyone out there really believe that Saudi's are gonna cut back production? They didn't say so. Did oil inventories decline? No. Do you think that negative interest rates are sustainable? No. And AMZN miss by 1/3 on earnings? It's P/E is still north of 90.

This is BS trading and a bunch of hopers - there may be some kind of follow-through; but anyone who stays long will get what's coming to them. Pay attention. I say lower prices to come in all of the major indices.

But if there are enough prawns out there to soak up the weakness? We could still see another relief rally. On a Friday lol, next week should prove to be very interesting. No one would, imo, expect Japan's interest rate to stick for long. Russia, Saudi and others "talking" about oil. Rig count still needs to drop further. Still plenty of hurdles for oil, $25 - $40 range volatility near term. A lot of whipsaw action. That's why I'm not going all in on anything. I like my sleep.