Market Talk

[mlk_man]

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The Technician wrote:

Accumulation indicates that the market has been going down since Aug 8....remember I mentioned that Aug 8 was a black Monday....well now you are seeing why I said that.....

Aug 2nd, S-fund $16.04

Aug 5th (last trading day before Aug 8th), S-fund $15.63.

That's 2.55% you owe me. I'll tak a check...................

 

[The_Technician]

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mlk_man wrote:

The Technician wrote:

Accumulation indicates that the market has been going down since Aug 8....remember I mentioned that Aug 8 was a black Monday....well now you are seeing why I said that.....

Aug 2nd, S-fund $16.04

Aug 5th (last trading day before Aug 8th), S-fund $15.63.

That's 2.55% you owe me. I'll tak a check...................

If you look further on the S fund goes up and down even since then....but is down over 6 % since then.....the S&Pmarket is down about the same but ....we are not talking about the same thing....I wasn't including the data previous to Aug 8th

:dude:

 

[mlk_man]

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The Technician wrote:

If you look further on the S fund goes up and down even since then....but is down over 6 % since then.....the S&Pmarket is down about the same but ....we are not talking about the same thing....I wasn't including the data previous to Aug 8th

:dude:

I was just trying to keep ya grounded. Meant no offense. :^

 

[bkrownd]

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The Technician wrote:

Give yourself some time and you will see some analysis....that is the characteristic of such a board like this.....in other words I think you are rushing it a bit for the little time you have been on the board....

By "analysis" I mean numerical models, based on economic theory, which transform raw economic input data into results that can be tested against what happens in real world. Anything less is insufficient. Theory. Formulas. Models. Numbers. Show me the numbers! Not quaint Etch-a-Sketch doodles. When I see quantitatively how that line on the plot is supported by solid economic theories applied to raw data to predict actual $$$ values, THEN I will start to believe it.

So, where is the math? I'm getting more interested in the details of what's actually going on the longer I read about it.

 

[The_Technician]

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bkrownd wrote:

The Technician wrote:

Give yourself some time and you will see some analysis....that is the characteristic of such a board like this.....in other words I think you are rushing it a bit for the little time you have been on the board....

By "analysis" I mean numerical models, based on economic theory, which transform raw economic input data into results that can be tested against what happens in real world. Anything less is insufficient. Theory. Formulas. Models. Numbers. Show me the numbers! Not quaint Etch-a-Sketch doodles. When I see quantitatively how that line on the plot is supported by solid economic theories applied to raw data to predict actual $$$ values, THEN I will start to believe it.

So, where is the math? I'm getting more interested in the details of what's actually going on the longer I read about it.

Well, maybe common sense is easier....

Maybe you could indulge us .....with your math background......mine is proprietary....

if you find it insufficient here.......where is that door....MM or somebody.....you know where we can find that door.....????

 

[The_Technician]

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Base on what I see in the market opening I believe we will get a market floating somewhere in the 1170's and higher range today.....but that is just speculation.....of course it could just drop out....but I think they are trying to window dress it for the average investor for the weekend news....

:dude:

 

[robo]

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bkrownd wrote:

So, where is the math? I'm getting more interested in the details of what's actually going on the longer I read about it.

This will get you started if your interested in playing trends and trading ranges.

http://stockcharts.com/education/

If you just want to be an investor I personnel like Bob Brinker. I get his Marketimer and his On Demand Service.

http://www.bobbrinker.com/


Want to be a trend trader bkrownd? Want to learn the math? Greg does it pretty good!

The Market Listener Trading System - My trading system is the result of years of mistakes. I have reviewed lots of newsletters and gurus who have attempted to give their subscribers advance notice of coming market trends and cycles. For this and many other reasons, I always seem to be zigging when I should be zagging. After what has been literally years of research into cycles, Elliott Waves, and many other systems, I have learned that my own trading style is best handled by avoiding the "art" of prediction at all costs!!! When I looked at moving averages for indication of trend direction, it seemed that they too were always 180 degrees out of phase with what I should have done. My conclusion, after many losses and frustration, is that I needed to let the market tell me what it wanted to do. In particular, I wanted to follow the trend, which is your friend, until the market whispered, or shouted to me that it wanted to change directions. And then, I found that Stochastics and Rate of Change indicators help me go to cash until the trend reverses or continues. Thats how my trend following system & its cash management variable developed. I trade Rydex Venture and Velocity funds by which I can go short (x2) or long (x2) the NDX (Nasdaq 100 Index). I hope my newsletter and its insights can give you an education on alternative investment strategies. You might find your own technique or modify mine.

http://www.safehaven.com/archive-173.htm

About the Author: Gregory Miller is a registered Professional Engineer (PE) in the State of Texas. He has been involved in electrical engineering and projects in the U.S. and some far-flung regions of the world. Greg has studied the markets for decades and enjoys applying his analytical abilities and computer number crunching to the science of investing. He is currently self-employed as an engineering consultant and forensic engineer. You can see more about his forensic work at http://www.forensicPE.com.



[align=center]Greg currently has a sell signal in place using his modeling. The proof is in the gains.[/align]
Greg's current comments.


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Watch for our weekly report on http://www.SafeHaven.com by Saturday morning.


Market Comments -Thursday's Nasdaq Action (10:30PM CT)

We are having a good week inspite of the NDX rally on Thursday. The Dow, SPX and OEXclosed flat, NYSE down, NDX and Composite closed up strongly. Is the Nasdaq tech leading us into a rally? If so, it is likely only short-lived and probably not a tradable rally. The big safe moneyseems to beworried about the next couple of months. All indices have collapsed below the 200 day moving averages. Wall Street technicians, if they haven't beenfired yet, are flashing warning signs to their corporatemoney managersthat the peak may be behind us and we will likely stair-step down from here until non-energy PE's begin to move toward a ratio that is more in line with 2006 earnings and reduced consumer expectations.

On Friday we getsome economic numbers includingCPI, Retail Sales, Capacity Utilization, Industrial Production, prelim Mich. Consumer Sentiment. These could be market movers, but which way? We don't care. If the market rallies on BAD news tomorrow, we should consider that as a bullish sign and expectthat rally will havea lower high than the last rally. We will watch our stop level and hope that the mini-rally does not take us out of our short position. Worst case for Friday is that we get another 0.5% down day on the SPX to end the week.

Trend followers must wait for the next trend to develop and not try to pick the bottom here. There is not indication yet that the downtrend is broken. And there is great danger that we might try and predict that the bottom is in and miss the greatest capitulation sell-off since 1987!!! Unlikely, but this is how trend-trading makes its big money. Trend traders are nearly always on the correct side of the big moves.

The slope looks very slick! Chances are we are going to make some more money withthe currentSell signal.



Current Signal: Sell (100%) (SELL for short-term traders and SELL for longer-term mutual fund investors who have trading restrictions.)

Volume: Heavy (to the downside) The volumecontinues to be heavy on the NYSE.

Sentiment:VIX and CPC aregrowing morefearful. The CPC is at levels where we MUST see aSLIGHT BOUNCE or a MAJOR SELL-OFF. VIX is rising steadily, but has not reached theblow-off peak in conjunction with a capitulation sell-off. If we rally from here, then there is a good chance that the amount of latent optimism still present in the market willdelay and perhaps amplifythe capitulation that we have hoped for while in our Sell mode.

Trading Model (Using SPXand NDX): SELL signal.In our weekly modelthe Stochastic has not yet gone to oversold. This factor and the rolling down of our MACD to just below the zero line tells us that the selling is not finished for the extendedtrend leg. A pop of 2% here should be expected, but should not reverse our Sell signal since our stop is set at +2.5% above Thursday's close.





Looking at SPX- The Nasdaq exuberance today seemed to be without basis technically when compared to the SPX. The S&P 500 closed up off of its lows for the day, but has done nothing to break the massive downtrend of the last seven days. An examination of the speed of this downtrend in SPXmay be telling us that there will likely be more sideways to lower action. Only the Nasdaq 100 and Composite seem anxious to reverse the bearishness.

Our stop has been revised down slightly to 1572.ForFRIDAY, and unless revised ina future email or the weekend report, let's set our stop/exit level at 1572 on NDX.


Fault Tolerant Cash Safety Stop/Exit:If the NDX rallies above 1572ona dailyclose, I will exitthe RYVNXand go to completely 100%to cash before the close of that day (Today and until revised).



Have fun reading, and enjoy!


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[robo]

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Some comments from a Tech: Sell signal still in place. The trend is down.

Not only has S&P 500 fallen below its support band, but it has also closed twice below the uptrend line drawn through its 1137.50 low. I do expect a decent rally with the coming Summary Index buy signal, but I also see further trouble ahead, as we will see below.

Finally, the members of the American Association of Independent Investors (AAII) have renewed their bearish vows and are close to producing a contrarian buy signal.

Looks like we could get a bounce up today! That would be nice for a change.

 

[The_Technician]

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My question is this Robo....do uread uncertainty inhis comments.....

"With the S&P 500 below its support band it is likely that it will now test its uptrend line around 1180 or just below. Then, a bounce back up to 1190 to test the band. Following these tests we can expect either a breakout to test the 1137.50 low, or a breakout above the support band to test the high for the year at 1245.

The very large number of negative indicators, and the total absence of positive indicators suggest that the market is too oversold to test the low of the year until after the upside test is made."




I think his gain for the year is great, but I believe his could be better....I know mine could have been in the 50% range in the TSP if I knew what I had just learned this summer....

I know it will have to be proven, but, I'm certain the market is going down as I predicted 4 months ago........there will be no tests, just a quick and minor market rebound and then down.....that's definite.....no guessing its going above to test 1245....it won't happen.......no test at 1137.5....its going lower.....its not a test of deviation bands.....

The bottom line...the market has been failing for a while and that trend will not change much for a while ......

EOY market will be played for tax related losses....so November and on will be interesting....looking for the sell off by early mid November until mid Dec....then we are going to see some buy back for a short period....then down again....until spring...



:dude:The Technician (aka Dances With Wolves)

 

[robo]

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Technician,

Some of these guys are like politicians. They want to cover all the bases... This tech stated early this week we MAY test the lows... But the trend is still down with some bull traps added in... He currently has a sell signal in place.It's still a coin toss at this point.... All just opinions,but I'mstill in the G Fund for now. I still remember April!!!!

OUCH! I got into early...I have some ok gains for the year and I'm trying to protect them.... I'm going all in soon!

 

[robo]

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Some comment from a Tech:

Friday10/14/05 Morning Comment

In the last two days, there were good reasons to believe that we were close to at least a bounce which could perhaps develop into an oversold rally. After showing positive divergence, all the hourly indicatorsturned up and, at the close, were inuptrends. This meant that wewere likely to get an extension of yesterday's bounce. We got it this morning, buthave already run into some selling. That's fine! It takes a while to turn trends around.

The hourly MSO, as I have indicated before, is the best indicator of the beginning and end of short-term trends. Right now, the Qs MSO is overbought, but the SPX is not.

Overbought means caution. Step one!An orange flag! When this indicator turns down from overbought, the flag turns red! The next and final step is the trend line break followed by level break. And then the process reverses. This works the same for the daily and weekly MSOs, with different trend significance. Right now the daily is overold, but still declining. The weekly is still declining and approaching oversold.

There are some variations to this basic pattern, but this basic analysis alone is extremely useful to determine market direction. I have explained this so that simply by my mentioning the position of the MSO, you will know what Iexpect of the market.

Of course, this is only one momentum indicator. But when combined with the BSPand A/D indices, and they all confirm one another, they collectively give very powerful signals.

So, the market position is currently: VST/short term getting overbought. Intermediate trend still not ready to turn.

There are no upside projections to give at this time. The structure for making these projections is lacking.

 

[The_Technician]

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Yeah...you're right about that, make a prediction with some way to get out.......if you're wrong.....I prefer in knowing in what I'm doing.....but then u know the drill, "You never never know" until it happens......there, that covers me too!!!

I'm glad your tech does agree somewhat in my direction though.....

The odds are against anyone trying to make a short term gain right now....best to side step this down trend slide and wait it out.....U can't really have any surety with daily trading at all at this time....its like trying to run through fire and saying you won't get burnt.......

Don't get burntby staying out until the fire subsides is the best strategy....

I went back and looked at the trading vol for the S&P for a long way back to pre 1970's.....its vol hasn't been higher than what is had been over the last several months....after the last energy crises in the early 70's the market crashed below it recent low of 5 or so years earlier.....if we crash like that, that means we will be below 760's ......a thought to ponder....



:^

 

[oldschool]

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new here. wondering if others have views on whether Refco debacle will have " Long-term Capital" like legs. Refco had huge forex business, many counterparties including some big banks, must be worried. Today news out Refco shutting their SEC registered BD business. I'm assuming that the big selloff at midday yesterday was really driven by street reaction to inability to assess who would be hurt by Refco meltdown, not any of the broader themes usually considered here (4 horsemen, etc.):%

Many professionals away from the Street for regligious holiday yesterday/today - may mean full Street reaction to Refco and full info on Refco exposures won't register w overall markets until Monday. Mondays in October... oh boy, this should be fun. If TSP had options I'd bet on volitility, just not sure which way

 

[robo]

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Some comments from a Tech:

Update 2:00 EST

The hourly MSO is now overbought on both indices, buthas not yet turned down. However, by the time it turns down, the down trend could already be on the way.There are several possibilities concerning the relationship of the MSO to price at the beginning of reversals.

The VST is now vulnerable to another retracement. How much selling comes in this pull-back will give important clues about the longer term trend.

Closing Comment

I intend to give you a clear picture of where the market stands in the Week-end Report,and for now just touch on a couple of things.

Obviously, I got my wishfor a second good day, butwe are awfully close to the end of our little rally and will become even more vulnerable on Monday morning. The hourly MSO has reached a level that it rarely exceeds and I am just waiting for it to turn down. The hourly A/D and BSP index are still in up trends and must also turn down. The sell signal will come from breaking a now well-established trend line.

More this week-end!

Yaaaaaaaa, a litlle rally was nice for a change! My Vanguard Funds have not been happy lately!!!! No short term plays their... Two moves a year makes me an investor in those accounts. My International, Emerging Market and Pacific are keeping my head above water YTD. I think it's getting close to switching somefunds into the US Total Stock Market!


Good call on the short term play Tom!

 

[robo]

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bkrownd,

The math used for my favorite chart. The 50 and 200 day moving averages.


http://stockcharts.com/education/IndicatorAnalysis/indic_movingAvg.html

 

[bkrownd]

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robo wrote:

The math used for my favorite chart. The 50 and 200 day moving averages.

That's just data manipulation. (using an extremely simple filter) That doesn't justify real $$$ values by crunching raw data (costs, inflation, wages, taxes, sales, etc...) through tested numerical models that are based on fundamental economic formulas or theories.

 

[robo]

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bkrownd wrote:

That's just data manipulation. (using an extremely simple filter) That doesn't justify real $$$ values by crunching raw data (costs, inflation, wages, taxes, sales, etc...) through tested numerical models that are based on fundamental economic formulas or theories.

True. So using the data your talking about should the market be up or down in the current cycle? The bulls say up, the bears say down! I don't care I play the trends.

Put 50 economists in a room to talk about the economy and it would be the same as putting 25 liberals and 25 conservitives together. The trends track the human factors of investing based onthe data you mentioned... But humans don't do rational thingswhen it comes to investing. You should buy low and sell high, but many investors get it wrong... That's how you can make money buy watching the herd! Just charts of sentiment sometimes, but tools none the less. Bob Brinker does an excellent job of crunching raw data (costs, inflation, wages, taxes, sales, etc...) through tested numerical models that are based on fundamental economic formulas or theories to base his Marketiming model...I have some Vanguard accounts and I use hismodeling... I only have2 moves a year so most of the time I'm fully invested in those accounts...

Here at TSPTALK it's; Our mission is simple: We want to maximize our Thrift Savings Plan retirement accounts and help others along the way. We do this by allocating our TSP assets into the funds which have the highest probability for capital preservation and greatest possibility for increased returns.

I use my manipulated data to make my choices. Birchtreeconsiders,real $$$ values by crunching raw data (costs, inflation, wages, taxes, sales, etc...) through tested numerical models that are based on fundamental economic formulas or theories.
I use my datasometimesto make2 or 3 day moves in and out ofthe market.

The facts are,"That's just data manipulation. (using an extremely simple filter)."

I agree, but they are useful used correctly along with the data you mentioned!

Good luck in your invesment decisions... You can take a horse to water, but.

 

[vicky]

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BRAVO! BRAVO! BRAVO, ROBO!!

 

[Rolo]

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The Technician wrote:

on 16 Sept, there was a sharp increase of daily volume for the S&P, since then the daily volume has steadly been higher than normal....and the market isn't going up....so that means....what......

That a lot of investors are cashing out to pay for yo momma since she got her night job on 16 September!

heh

The Technician wrote:

Give yourself some time and you will see some analysis....that is the characteristic of such a board like this.....in other words I think you are rushing it a bit for the little time you have been on the board....

Agreed.

Speculate: from Latin speculare, to observe

bkrownd wrote:

...transform raw economic input data into results that can be tested against what happens in real world. Anything less is insufficient. Theory. Formulas. Models. Numbers. Show me the numbers! Not quaint Etch-a-Sketch doodles. When I see quantitatively how that line on the plot is supported by solid economic theories applied to raw data to predict actual $$$ values, THEN I will start to believe it.

(bold added) So you want solid theories to support the insufficient theories?

bkrownd wrote:

So, where is the math? I'm getting more interested in the details of what's actually going on the longer I read about it.

What you are trying to predict, with raw data and formulae, is human nature. If everything were so concrete, then we would have singular absolute values for every market commodity, asset.We haveprice fluctuations because the market is human interpretation of various theories, conditions, and opinions of the future.

[line]

Tech, do you think the I Fund will follow domestic funds?

 

[tsptalk]

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robo wrote:

I use my manipulated data to make my choices...

Was that supposed to be a new paragraph or are you adding that to my mission?