FogSailing's Account Talk

[FogSailing]

Just FYI. Things I’ve read today:

– Natixis (french bank): “We don’t expect any production cuts” “Oil could dip to $20 before slow rally”

– Goldman: “Expects oil prices to remain volatile and oscillate between $20/bbl and $40/bbl in the near term” “sees 20% drop in the US stock market near term”

– Deutsche Bank: “Strong buy on gold target $1500”

– SocGen: “FED: only 1 rate hike is coming in 2016”

Opinions are split about tomorrow, but one thing is not...tomorrow's closing will tell us a lot about March

FS

 

[FogSailing]

I don't recall when I've seen the market giving me so many conflicting signals. Three of the guys I follow everyday all say that the chances are good for a continued leg up. Unfortunately, I don't read the MACD that way even though most other TA indicators look good, and oil is up at this hour. If your into Elliot Wave and agree that Wave a = Wave c (and assuming the count is correct), we have a nice leg up through March 10th. I just don't want to catch the falling knife. I'll try to decide after closing tomorrow which way the wind is blowing. Here's the chart:

View attachment 37335

Also, here's a picture of Janet Yellen at the G20. She looks very disconnected from the others in this picture...like she just took cod liver oil or something...very interesting.

View attachment 37336

FS

 

[FogSailing]

Good blog post...

Keep It Simple Stupid!

FS

 

[FogSailing]

Another interesting and informative chart today from Trader Joe:

ES Confirms a Price Channel Sunday Night | Trader Moe

FS

 

[FogSailing]

All the positive stuff in SPX based on Oil rumors...sheesh...

I guess I just feeling crazy this morning...I'm thinking forget about horrible PMI or bad home sales or European deflation because next week there will be more stimulus!!! BUY!!!!!

FS

 

[FogSailing]

The EU stimulus will probably come...but not till next week. After watching today's close...I remain on the sidelines.

FS

 

[FogSailing]

Here's the indicators for Fear and Contentment:

VIX:

View attachment 37383

SENTIMENT:

View attachment 37384

How can anyone not want to through loads of cash into a market with a stable 20 VIX rating and 91.7 sentiment rating...Come on in.....the water's fine....there's no deep end in the pool...

One of the guys I read says the VIX will be stable for about 10 days out. I have no idea how he knows this but he is a successful trader and a smart guy so I'm hearing him.

Unfortunately, I can't get that picture of Wylie Coyote going over the cliff out of my mind and that is overriding my greed...so my personal VIX indicator is closer to 50 right now (especially after todays gains - ON WHAT?). All of which means I'll miss out on the next 2-3% gain before things really go wherever they are going to go..

I'm thinking a break from the market craziness will be a good thing. Took the last 2 days to golf up at Lake Havasu and enjoyed not following this stuff. Golf (while not exactly a stress free sport) was a lot of fun (probably because of the 19th hole because the guys I golfed with were a bunch or prudes-just kidding). Decided that any more posts this month will be focused on TSP Poker Club (which more people should join because it's fun) or by offering my usual sage advice in all its forms to my friends on the Forum at the customary rate of free.

FS

 

[FogSailing]

Just a few thoughts for this week:

So after 1 month of negative rates in Japan, the opposite of what the BOJ was trying to accomplish happened. Lending went down, deposits went up. People are buying safes. I guess this is the reason why gold is going up. I have a feeling capital from Europe will find its way to the US in Treasuries and equities. So our market may be the benefactor of EU and Japan central banks.

The Effects of a Month of Negative Rates in Japan - Bloomberg Business

But, with regard to the ECB’s negative interest rates, a more apposite refrain might be from the Rolling Stones: “Well I told you once and I told you twice, but you never listen to my advice. You don’t try very hard to please me, with what you know it should be easy. Well, this could be the last time, this could be the last time, maybe the last time, I don’t know.”

German right wing tells Mario Draghi: This may be the last time - MarketWatch

Best of luck to you in your investing...see you on the other side of the Fed announcement..

FS

 

[FogSailing]

Just a few thoughts for this week:

So after 1 month of negative rates in Japan, the opposite of what the BOJ was trying to accomplish happened. Lending went down, deposits went up. People are buying safes. I guess this is the reason why gold is going up. I have a feeling capital from Europe will find its way to the US in Treasuries and equities. So our market may be the benefactor of EU and Japan central banks.

The Effects of a Month of Negative Rates in Japan - Bloomberg Business

But, with regard to the ECB’s negative interest rates, a more apposite refrain might be from the Rolling Stones: “Well I told you once and I told you twice, but you never listen to my advice. You don’t try very hard to please me, with what you know it should be easy. Well, this could be the last time, this could be the last time, maybe the last time, I don’t know.”

German right wing tells Mario Draghi: This may be the last time - MarketWatch

Best of luck to you in your investing...see you on the other side of the Fed announcement..

FS

OK. One more comment and then I'm quiet for the rest of the week....

Besides the euphoria in the air, there is a lot of talk about consolidation coiling the markets for a spring higher, and solid market breadth. I’m not sure what to make of the breadth data and whether as a (temporary) bear (sort of like being an Independent ) it should be concerning me. I use market breadth to look for divergences within a trend, but now we’re in a different type of trend so I don’t know whether it shows much to make a comparison between now and last October for example. Given we’re at a 50 day high and significantly above the SPX 50dma, for a stock to be under its 50dma it would have to be lagging the market badly. The main things I see is that the slope of the 200 day is still down and falling, and momentum on the monthly is still weakening. Any sustained price action above current levels could change this though, but as a sense check, the market wasn’t able to break above the 2050-2100 area the whole of last year so I can’t see a catalyst that will bring buyers in at those levels when the risks have increased, the earnings outlook deteriorated and monetary policy decisions appear to be having smaller and smaller impacts. IMHO, at current levels it won’t cost much more to call the market’s hand! I'll look forward to checking back in next week to see where we ended up.

FS

 

[FogSailing]

I am in a total quandary regarding the market. I have overly cautious and very bearish since January and I'm missing out on gains. Last night I speculated on why it wasn't a good time to get into the markets. However, this morning I read a post with "rumors" I really haven't heard before. I have no idea if this is fact or fiction (but G20 did just meet) but it is something I read about today and it wanted to share it:

https://www.tradingview.com/chart/SPX/MUAJoTfk-SPX-Consolidation-Roadmap-March-2016/

“In the past few weeks, officials from China, the euro area, Japan, the U.S. and the U.K. have taken a barrage of actions to keep the world economy afloat and currency markets calm.
That’s led some analysts to conclude that there is indeed a secret Shanghai Accord, akin to those reached in an earlier era at the Plaza Hotel in New York and at the Louvre Museum in Paris”

My Confusion clarified:
1. Since I follow Elliot Wave, I have been waiting the B Wave (ascending in this case) to end. I expected that to happen when there was significant resistance at SPX 2000. It didn't and it hasn't yet.
2. JTH said yesterday that Feb-May is the peak market season. Check.
3. Oil seems to have delinked a bit from SPX and the two are not in perfect tandem as they have been for a while now.
4.It now appears to me that bonds and stocks are working more in tandem.
5. When the slightly lower low occurred, it formed a double-bottom which had divergences both on the daily MACD, and daily slow stochastic, and formed another quasi-hammer candle, followed by “three bullish white soldiers”. (And multiple confirmations of higher closes). Then there were consecutive closes above the EMA-34 locking an up trend.
6. How in the world can we be in a down trend until prices have consecutively closed below the EMA-34 or the SMA-20?
7. However, A move from 2135 to 1810 qualifies as a downtrend to most people; 6 and 7 taken together are totally baffling.
8. Which leaves me with "why"? An organized CB intervention makes a lot of sense and would be a good reason for the continuing ascending B wave. Would be nice if that rumor could be confirmed.

So, my question to myself is "Get in or Stay in F"? Today is Friday and OPEX day. Safe play is to stay put in F, adventure sides say bite the bullet, swallow the pill, go all S and pray for a rocket ship up on Monday..

FS

 

[Whipsaw]

Call me suspicious, but I would expect these "Shanghai Accord" type efforts to keep the markets afloat to go on until a republican takes office.

 

[FogSailing]

One final add: Another analyst I follow made the following observation:

This uptrend in a rising wedge is quite similar to 9/29/2015 to 11/18/2015 movement (wedge) rised 13.55% and RSI touched 70 before starting a downtrend. Now 2/11/2016 to 3/18/2016 13.80% rise, RSI 71%. . Quite difficult to continue rising.

Decided to stay where I am...Still think there is a possible .5-1.5% left on the table next week but with RSI so high, don't think it's smart to push the envelope.

FS

 

[ravensfan]

One final add: Another analyst I follow made the following observation:

This uptrend in a rising wedge is quite similar to 9/29/2015 to 11/18/2015 movement (wedge) rised 13.55% and RSI touched 70 before starting a downtrend. Now 2/11/2016 to 3/18/2016 13.80% rise, RSI 71%. . Quite difficult to continue rising.

Decided to stay where I am...Still think there is a possible .5-1.5% left on the table next week but with RSI so high, don't think it's smart to push the envelope.

FS

Yeah it's a tough call FS. Part of me says jump in before it's to late and another part of me says to be smart and wait for the next rally. In the past I have chased the rally only to watch it plummet once I'm in, so as much as I want to, I will fight the urge and stand pat.

I recall the definition of insanity, being to do the same thing over and over again and expecting a different result. So this time, I'm standing pat.

 

[Tsunami]

Wave 2 is definitely doing its job at convincing everyone that the bull market has resumed, so any time now the rug can be pulled out.

 

[nnuut]

Be Careful the NEW Bull market isn't confirmed, it may or may not. I'm getting out when I think the top is in, where that is I don't know but it is going to happen very soon. Be careful.

 

[FogSailing]

Appreciate the feedback guys. As I re-read everything, it reminds me of that famous saying..."Sir....Please Step Away...Step Away from the IFT Button"

View attachment 37623

FS

 

[FogSailing]

I know it's just my cynical side saying this but with the Brussels tragedy you would expect a reversal today. Instead the EU floods more QE into Europe so I guess that's the Wests way of saying up yours to terrorism. Works for me. However, the rally is so extended it feels unnatural. Probably "just the market" but can't help but think the market is being kept up by the PPT until Goldman, JPMorgan, Chase, Wells Fargo, BankAmerica etc. and the rest of the Illuminati get their shorts lined up. Watching for news out of Tokyo sometime this week.

FS

 

[userque]

I know it's just my cynical side saying this but with the Brussels tragedy you would expect a reversal today. Instead the EU floods more QE into Europe so I guess that's the Wests way of saying up yours to terrorism. Works for me. However, the rally is so extended it feels unnatural. Probably "just the market" but can't help but think the market is being kept up by the PPT until Goldman, JPMorgan, Chase, Wells Fargo, BankAmerica etc. and the rest of the Illuminati get their shorts lined up. Watching for news out of Tokyo sometime this week.

FS

There you go again. Thinking logically.

 

[JTH]

I know it's just my cynical side saying this but with the Brussels tragedy you would expect a reversal today. Instead the EU floods more QE into Europe so I guess that's the Wests way of saying up yours to terrorism. Works for me. However, the rally is so extended it feels unnatural. Probably "just the market" but can't help but think the market is being kept up by the PPT until Goldman, JPMorgan, Chase, Wells Fargo, BankAmerica etc. and the rest of the Illuminati get their shorts lined up. Watching for news out of Tokyo sometime this week.

FS

There you go again. Thinking logically.

Sad but true, the more security we profess to need, the more money we'll profess to spend...

 

[FogSailing]

With buyback blackout starting next week, and despite the current pullback, I think the market melts up to 2060ish by Friday before we really start to pullback. Considering jumping in for 1 or 2 days....Crazy but true..

Just to add..TRIN is down, VIX is up so there is definitely a change afoot...also Oil inventories are quite high...

Just got a call from BP to store some oil in my back yard...told em no but gave them the numbers of the TSP Poker Club..you guys will be getting a call..

FS