Market Talk / September 17th - 23rd

[Spaf]

The Kingdom of TSP​

The Catfish Channel​

Sunday-Weekly
Early Edition​

September 17, 2006 ​

Yak, Doodles, Tea Leaves & The Tin Box

Kingdom Yak:
Pro-Yak...................................Socks overbought? Channel top 1326; bottom 1296 [$SPX].

Con-Yak...................................Last Friday showed the candelstick hammer (Ouch!)?

Jester-Yak................................Decisions, decisions!

Doodles:
Socks [$SPX] Closed at..............1319.87, up +20.95 for the week!
Volume (CMF) (money flow).........+0.200, declining.
Averages (MACD) (trend)............+6.460/5.614 increasing, but with weak divergence.
............ (MACD) (Hist)...............up at +0.846
Momentum (S-STO) (signal).........88.96, down dip in overbought territory.
Strength (RSI) Overbought/sold....[70] 65.77 [30]

Lube (NYM) Closed at..................63.33, dn -2.92 for the week. A drop of 4.4%
Oil Markers................................<70= ok, 70-75= worry, >75= panic.

Tea Leaves:
Yakndoodles..............................Yellow (caution).

Tin Box:
Position....................................70% Socks.
Stops [$SPX].............................Alert (-1%): 1306. Trail (-2%): 1293.

TSP (week ending)......G=11.55..F=10.90..C=14.52..S=17.19..I=19.83
....(1 week past)........G=11.54..F=10.91..C=14.28..S=16.87..I=19.80
....(2 week past)........G=11.53..F=10.92..C=14.41..S=17.15..I=20.18
....(3 week past)........G=11.52..F=10.87..C=14.23..S=16.71..I=19.84
....(4 week past)........G=11.51..F=10.85..C=14.31..S=16.95..I=20.05

Note: I-Fund: $ hits 7 week high.

Le Chart..:blink: ​

Chart courtesy of www.stockcharts.com
[Channel annotations added]​

 

[Birchtree]

Now if all you lilly pad G funders sit tight this week, both Techy and I will have a chance to slip on past the leaders. There ain't no good news anywhere - so be safe rather than sorry. Don't sacrifice those hard earned trading gains by trying to catch the wave. Bump a lump, bump a lump, that's Tully turtle on the move.

 

[Show-me]

http://www.tsptalk.com/comments.html

Tom's "smart money indicator" is defiantly is interesting. Zero bulls............:worried: .

 

[The_Technician]

Now if all you lilly pad G funders sit tight this week, both Techy and I will have a chance to slip on past the leaders. There ain't no good news anywhere - so be safe rather than sorry. Don't sacrifice those hard earned trading gains by trying to catch the wave. Bump a lump, bump a lump, that's Tully turtle on the move.

Birchy, I'm currently in G fund wid the rest of them lilly paders....gonna get my one cent worth today...

 

[ebbnflow]

http://www.tsptalk.com/comments.html

Tom's "smart money indicator" is defiantly is interesting. Zero bulls............:worried: .

And, on one of Tom's comments he mentioned...

We are in the week following options expiration week and stocks tend to struggle. In the chart below, the red graphics indicate the average return for post options expiration week. Only Wednesday has also a positive average and it's the only day that beats a random day's return. Keep in mind that this data is taken from just a seven year sample.

The ebb tracker has also pegged Wednesday for the only uptrending day the whole week. Just hope the herd isn't on to it yet.

...Strange as it may seem, the ebb tracker seems to be seeing a lot of patterns with down trends these days. For next week, the only day showing with an up trend is Wednesday (FOMC meeting). That's a one day move to the I-fund and then back again to the F-fund for Thursday. We just might see some fireworks on Wednesday, so be prepared!

 

[Griffin]

Tom's "smart money indicator" is d...tatement, I expect the last hour to be rough.

 

[The_Technician]

Market Rethink

A rethinking of the market was referred to by Spaf last week.....I think the dollar is showing a strengthening trend for the next few months....that should help.....I fund may not be such a good deal over the period....so you will have to trade it to make it.....think the C and S will flourish if substantial recession doesn't form....we are on the verge of this right now....a good notch in the barrel at the moment is the retrace of oil prices....thats a big help.....now interest rates need to retrace.....

 

[ebbnflow]

I heard or read one time that the bulk of the dumb money likes to trade during lunch and the smart money leans towards trading in the last hour. Has anybody else heard this before?

If there is any truth to that statement, I expect the last hour to be rough.

From this website:

August 10, 2006

I'm relieved by today's stock behavior. Not because the market's up a bit (a paltry 6 points on S&P), but rather due to one measure of the internals. And today's behavior was a reversal of yesterday's.

It's presumed that much of the first hour of the trading day is volume from average retail accounts. Traders refer to this as "dumb money." The last hour is dominated by professional and institutional traders--self-referred to as "smart money." Setting aside the insulating monikers, the general idea is correct--the retail trader is usually on the losing side of the trade, while the institutional trader usually trades with greater success. At least as it relates to the intraday opportunities. This is a fact. Further, when smart money is doing something differently from dumb money, the smart money is showing you where stocks are headed in the short-term.

Yesterday, the dumb money rallied the market notably after the open, and then the market sold off, especially during the last-hour, smart money period. That's not a good sign. Today, we got a reversal. Dumb money panicked in the morning due to the terrorist attack plan that was thwarted in the UK. Then, the market rallied to a close near the high of the day. That's comforting and is a bullish sign for the short-term.

 

[Pilgrim]

Wall street is notorious for either bringing up inflation or just ignoring it, whichever helps them sell stocks and pocket commissions. For example: "Many people are now waiting for the Dow to climb to a new high above the old bull market high (January 2000) of 11722.98"

Since it has been six years, one should adjust for inflation. Does anyone know what $11723 in January 2000 dollars is actually worth today?

 

[Pilgrim]

Looking at a monthly CPI table says that the DOW would have to be 13,651 today to have the same value as the old high. Probably not worth refining this number.

ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt

Just being cynical, sorry to the bulls who are waiting to celebrate.

 

[Fivetears]

Has anyone stopped to think... if our US markets are so talked of being overbought, perhaps the wait on Wednesday is to see how agressive the Selling will be?

 

[Oldcoin]

Since it has been six years, one should adjust for inflation. Does anyone know what $11723 in January 2000 dollars is actually worth today?

About 100 tanks of gasoline!

 

[The_Technician]

Has anyone stopped to think... if our US markets are so talked of being overbought, perhaps the wait on Wednesday is to see how agressive the Selling will be?

Tomorrow doesn't look good for C and S.....here is what I see for today at this moment for the funds GCSI...with the F fund there is no telling at the moment....11.56 14.57 17.27 19.87....the C and S will probably change some before this afternoon.....

 

[tsptalk]

I heard or read one time that the bulk of the dumb money likes to trade during lunch and the smart money leans towards trading in the last hour. Has anybody else heard this before?

If there is any truth to that statement, I expect the last hour to be rough.

There is an actual smart money / dumb money indicator out there somewhere that compares the 1st hour of trading (dumb, or emotional money) to the last half hour of trading (smart money). I haven't heard about the lunch hour theory.

 

[Spaf]

I haven't heard about the lunch hour theory.

Isn't that the IFT theory. As soon as the IFT is locked in the market goes the other way...... :embarrest: :blink:

 

[Spaf]

Daily Yak

The Kingdom of TSP ​

Catfish Channel​

Daily Edition
September 18, 2006 Closing​

Yak, Doodles, Tea Leaves & The Tin Box

Kingdom Yak:
Pro-Yak....................................Socks mixed! Overbought in top of channel!

Con-Yak...................................Whats with lube, and whats with the Cartel?

Jester-Yak................................Add a 2nd gravestone!

Doodles:
Socks [$SPX] Closed at..............1321.18, up +1.31.
Volume (CMF) (money flow).........+0.141, dropping.
Averages (MACD) (trend)............+6.842/5.859, weak divergence.
............ (MACD) (Hist)...............flat at 0.983.
Momentum (S-STO) (signal).........87.47, falling.
Strength (RSI) Overbought/sold....[70] 66.42 [30]

Lube (NYM) Closed at..................63.80, up +0.47
Oil Markers................................<70= ok, 70-75= worry, >75= panic.

Tea Leaves:
Yakndoodles..............................Yellow (caution).

Tin Box:
Position....................................100% G.
Stops [$SPX].............................Alert: 1308. Trail: 1295.

 

[robo]

Stocks: Remedial Education for Hedge Fund Managers

The markets were flat Monday as selloffs were greeted by buying support near the lows.

Sometimes you just have to wonder exactly what it takes to be a hedge fund manager. One of the elementary principles of investing says very simply, "Cut losses short." What this means is to make sure that you don't lose more than a certain amount of money in a position. The way that is accomplished is preferably through the use of a money management stop loss order. That lesson should be taught in Hedge Fund Management 101. The first week of class.

On Monday, a hedge fund named Amaranth, which started the month of September up a respectable 22% for the year to date, reported to shareholders that it was now 35% in the red for the year! Apparently, they had bet big on Natural Gas and were reluctant, or forgot, to set stop loss orders on their position. Now, if you've ever had that experience, you won't have to feel like such a newbie investor. This was a $9 Billion hedge fund, which is now a $6 Billion hedge fund.

The lesson for today is: always use a money management stop on traditional positions (Scale Trades excepted, of course). That means to determine the maximum percentage of your portfolio you are willing to lose and set the stop so that you won't lose more than that maximum. Now, do your homework and you may be a hedge fund manager someday

 

[Spaf]

Robo,
During grade school, I'm sure he told the teacher that his homework got eaten by his dog. Now they tell shareholders that investments got eaten by a hedgehog!......

Cute little fellow!​

 

[robo]

Spaf,

Very cool Hedgehog!

 

[Show-me]

August Housing Starts down 6%

PPI up 0.1% Expected up 0.3%

Core PPI down 0.4% Expected up 0.2%