Griffin Account Talk

[fedgolfer]

hope we didin't hit the intraday high when S&P hit 1490 and then SPY headed south on over 1.1million trades in that minute. GW speaks this afternoon on the subprime plan, that could make people run for cover. MACD and Slow sto indicate a little downward pressure but we all know that could change.

Time to bring out that yoda-bong Avatar, Grif. POT just broke out of a cup and handle.

 

[Griffin]

POT Potash Corporation of Saskatchewan Inc (NYSE)

To bad TSP doesn't have a Potash fund (it's a shame TSP dosen't have a fund that allows us to concentrate our exposure on ANY sector of the market)

http://www.tspshareholder.org/

hope we didin't hit the intraday high when S&P hit 1490 and then SPY headed south on over 1.1million trades in that minute. GW speaks this afternoon on the subprime plan, that could make people run for cover. MACD and Slow sto indicate a little downward pressure but we all know that could change.

Time to bring out that yoda-bong Avatar, Grif. POT just broke out of a cup and handle.

 

[fedgolfer]

spy and $inx just broke above that resistance level nice volume too

let's hope it isn't a head fake.

 

[fedgolfer]

that POT chart doesn't show the cup and handle as well as a 1-month chart by 30-minute intervals. But regardless... I LOVE POT.

 

[RPM]

My favorite indicator's are not looking happy (that's the MACD, RSI and Slo Sto). This has me concerned, but there is plenty of history that shows these indicators do make these kind of leveling off moves during recoveries without a signficant change in the trend. A red flag is raised, but it hasn't started to wave. Hopefully, the OSMs momentum carries through today's market and this red flag is lowered.

Griff:

Do you use the weekly charts at all? The Slo Sto is much more stable there, and may complement the daily charts. I would appreciate your input, since I have been looking at both sets of charts (daily/weekly) to get some system developed. Based on the weekly charts, I would only need a few moves a year. My goal is just to avoid the dips, not necessarily get the best of everything. Your calls have been excellent!!! Thanks.

 

[phillyfed]

spy and $inx just broke above that resistance level nice volume too

let's hope it isn't a head fake.

Noted.....A nice breakthrough and providing us a bit of time for analysis before the Noon IFT. Decision, decisions

 

[phillyfed]

that POT chart doesn't show the cup and handle as well as a 1-month chart by 30-minute intervals. But regardless... I LOVE POT.

You need to analyze that Bong chart pattern more closely

 

[Griffin]

Griff:

Do you use the weekly charts at all? The Slo Sto is much more stable there, and may complement the daily charts. I would appreciate your input, since I have been looking at both sets of charts (daily/weekly) to get some system developed. Based on the weekly charts, I would only need a few moves a year. My goal is just to avoid the dips, not necessarily get the best of everything. Your calls have been excellent!!! Thanks.

I only use the weekly charts when I'm looking lat long range trends. I haven't resigned myself to the two move limit so I have not adjusted my methods.

Theoretically. you could achieve outstanding results with less then 6 moves a year - but I don't know if that is actually possible to put into practice. I started this year with that concept but abandoned it almost immediately.

 

[Griffin]

Non-farm payrolls beat expectations coming in at 94K and unemployment beat expecations coming in at 4.7% (unchanged from last month as opposed to 4.8% forecast). That makes for a relatively neutral to slightly positive jobs report. Not enough positive to cause the Fed to reconsder a rate cut. All in all, probably the best scenario for the market.

Enjoy!

 

[Minnow]

Nice analysis of the jobs data...what are the chances of you preparing another S & P decision tree pre and post FOMC? (I'm guessing we trade tightly between 1490 and 1530 --give or take a few -- until Tuesday).

 

[Griffin]

Nice analysis of the jobs data...what are the chances of you preparing another S & P decision tree pre and post FOMC? (I'm guessing we trade tightly between 1490 and 1530 --give or take a few -- until Tuesday).

My goal is to stick to a weekly schedule unless I see something that signficantly shapes my view (like the ADP employment data did this week). Then I'll do another update.

I'll stick the decision tree's in on the "Griffin's Brief" page.

 

[fedgolfer]

All in all, probably the best scenario for the market.

Enjoy!

talk about a goldilocks number. That jobs number will be revised downward by a significant amount later on when people don't care and are chewing on other data. Also, today's numbers really didn't support ADP at all. But, I'm hoping the psychology of the market action today realizes that a .25 or .50 cut is good for the bull.

 

[Minnow]

My goal is to stick to a weekly schedule unless I see something that signficantly shapes my view (like the ADP employment data did this week). Then I'll do another update.

I'll stick the decision tree's in on the "Griffin's Brief" page.

As always, thank you for all the pro bono work, sir. Good luck with your weekly goal -- you're gonna need it.

Fedgolfer, I'm with you on the numbers -- but what do we know anyway?

 

[Griffin]

talk about a goldilocks number. That jobs number will be revised downward by a significant amount later on when people don't care and are chewing on other data. Also, today's numbers really didn't support ADP at all. But, I'm hoping the psychology of the market action today realizes that a .25 or .50 cut is good for the bull.

I was expecting a weak jobs report because of some of the weaker market data. ADP is seeing decent growth in the Jobs market. Today's report does not seem to reflect the growth ADP is seeing but it also shows that the jobs market is not in bad shape. I'm a bit suprised you think today's number will get revised down. Recession still appears to be avoidable at this stage of the game.

It sounds like you think the Dept of Labor report is more accurate then the ADP report? Are you leaning towards a .50 cut?

Even if a .25% cut is completely priced in come Tuesday, some profit taking can be expected, but that's not a real reason to reverse the momentum. We still have room for some more rise in this market. I am inclined to remain in equities through the Fed meeting.

 

[fedgolfer]

It sounds like you think the Dept of Labor report is more accurate then the ADP report? Are you leaning towards a .50 cut?

Even if a .25% cut is completely priced in come Tuesday, some profit taking can be expected, but that's not a real reason to reverse the momentum. We still have room for some more rise in this market. I am inclined to remain in equities through the Fed meeting.

The first rendition of the Labor report definitely doesn't seem accurate, does it? It seems to always be revised significantly. I think the jobs and ADP, despite the build up, was just noise. We know jobs data isn't pointing towards recession... its the subprime/housing/credit/liquidity blah blah.

I was originally leaning towards a .50 FFR .50 discount, but now there's definite debate for .25 FFR/.50. If we get the .25 FFR I'm sure we'll sell off --maybe only a bit though (due to the Paulson plan putting in that 1490 support level). If we get the .50, I'm inclined to stay in and just watch the strength of the MACD in the main indexes (longer term charts). I don't know what to think after seeing the Sentiment Survey... I would have thought everyone would have thought we would sell off after the announcement and thus be more bearish. Anyway, YOU'RE the expert and have the hot hand!!!!!!

 

[airlift]

Re: 12%ayear's Account Talk
I just signed the petition. Great idea!

Re: 12%ayear's Account Talk
Spread the word. I am lobbying very hard and calling everyday. Remember it is your hard earned money and future on the line. I hope they charge a small fee so they will not gripe again in the future.
__________________
http://www.tspshareholder.org/ spread the word
__________________
http://www.tspshareholder.org/

 

[Show-me]

Griffin,

What you lack in look you sure are making up in investing performance. Well done and keep on truck'n!!!

 

[Griffin]

Were having some technical problems this morning getting this week's brief posted.

In short - I am looking for the S&P to move to 1530 and the Wilshire 4500 to move somewhere as close to 700 as reasonable possible before taking up a capital preservation positionl. That move could come as early as tomorrow if we continue to see the market move upwards. A move later in the week is more probable.

 

[Griffin]

Last week I switched into the S-fund in anticipation that the small/mid caps would see superior gains over the large caps. This is a trend we have seen over the last few corrections and it appears to be successful. There is a tendency for the buying to shift from the more stable large caps to the better growth plays in the smaller corporations as the recovery trend becomes more definitive. I expect the C-fund to top before the S-fund and I want to hang on to this position long enough for the S-fund to play catch up. If the S&P 500 tops at 1530, which is about 2% above where we are now, the Wilshire 4500 should move to around 700, which is another 4% in the same time period.

In the five year chart below, I’ve drawn the long term channel and included two trend lines that have been critical areas of support turned resistance, vice-versa and been inflection points representing changes in market behavior. We are at the top of the channel defined by these trend lines, and a move higher from here enters the zone of more speculative behavior. This speculative behavior can turn sour very quickly, with a little bad news. The beginning of the last correction was triggered by various write downs. We may see more of these write downs, more CEO’s fired and more turmoil, but probably not until after the holidays.

View attachment 2786

As we move higher from here, we need to be concerned about the market turning on a dime. For now, I am fairly comfortable with the expectation that we will see 1530 at least, before the next move down. In the first paragraph, I explained why I want to hold on to the top as long as possible, in second paragraph, I explained why I want to bail at the top as soon as possible. The reality will be somewhere in between.

The key points for this week are 1) watching for the formation of a top in the S&P 500, 2) keeping an eye on the relative position of the Wilshire 4500 (i.e. catch-up), and 3) keeping an eye on the possibility that the market gains enough confidence that a recession will be avoided, allowing it to push beyond 1530.

The upcoming FOMC meeting will go a long way in effecting the third point. I don’t think it makes a difference if the fed does a .5% or a .25% cut. Here’s my logic behind this: The larger cut will have the effect of stimulating the economy, hands down but it will have a secondary minor effect of creating more inflation concerns. The lesser cut will have a similar primary effect, and a secondary effect of instilling confidence that the fed does not see a recession as inevitable. Because of this, I see the fed giving a .25% cut but with language that suggests the situation is under control. The CPI and PPI reports are due this week following the Fed, so inflation will definitely be in the spot light, especially if the fed cuts .50%. I have no expectations for any specific day this week, but I do expect the week to have an overall positive bias and to potentially present us with a good point to exit the market.

View attachment 2787

 

[Steadygain]

Man - you are incredible. I really appreciate your input and am very happy about your returns. On many levels you represent very high quality and excellent standards.