Nordic's Account Talk

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end of the year

Jumped back into the S Fund today for the rest of the month. Let's hope the Fed doesn't make a tapering announcement until January. Congrats to those on the AT who had the fortitude to stay invested in the stock funds this year, very impressive returns. I admit I wasn't expecting the 20%+ returns that we've seen this year.
 
taper talk

"The official unemployment numbers are not giving a true picture. Despite that the official U3 unemployment rate is moving in the direction the Fed wants it to go in. But it is still not down to 6.5% level that the Fed has considered to be level necessary to start pulling back on QE. And behind those numbers lies bleaker numbers. "Taper"? Not likely at this time. That the stock market, interest rates and gold are petrified of the Fed "tapering" speaks volumes for how weak the economy might really be. "Taper" talk appears to be just that - talk." 'Taper'? Not Yet! | David Chapman | Safehaven.com
 
Dollar on the rise?

"We believe that USD Index has now turned bullish with impulsive rise from 79.00 and breakout out of a downward channel. This breakout is important sign for a change in trend, even if just temporary. Based on a big picture with a triangle, we think that rise from 79.00 is start of a wave D that will unfold in three legs. If that is the case then current downward move is just a wave (B) correction that could stop around 78.6-61.8% Fibonacci retracement area. As such, move up in wave (C) could start unfolding in the second part of December." USD Index Looks For Bullish Reversal: Elliott Wave | Gregor Horvat | Safehaven.com
 
trend

"I maintain the idea that from the March 2009 low price is unfolding a corrective advance, probably a Double Zig Zag. If this is the case the next theoretical extension target is located at 1936. As I have discussed in my previous weekly updates once the corrective pattern is completed SPX will be vulnerable for a meaningful decline, which will probably not bring into peril the long-term up trend." Weekly Technical Analysis | TheWaveTrading | Safehaven.com
 
Sentiment

"Should investors take the new bullish level as a warning sign? Not necessarily, according to AAII. The association said its data are inconclusive about whether this is a red flag. It noted:
When bullish sentiment has previously been at unusually high levels (between 49.3% and 59.7%), the S&P 500 has risen by a median of 2.9%. When bearish sentiment has previously been at unusually low levels (between 10.6% and 20.5%), the S&P 500 has risen by 4.5%. In comparison, the S&P 500 has realized a median 4.7% gain for all six-month periods since the AAII Sentiment Survey was started in 1987." Fed taper pushes stock optimism to 3-year high: AAII - The Tell - MarketWatch
​
 
Sentiment...cont'd

I'm considering staying invested in the S Fund going into January, but I'm not sure for how long. Bullish sentiment, overbought conditions, and all-time high levels have me on edge. The only reason I've stayed invested this long is seasonality, otherwise I'd probably be on the lilypad by now. I said this about 2013, but I think 2014 will be an interesting year...and a challenging one in the markets. Buy low, sell high.
 
Re: Sentiment

Nordic said:
"Should investors take the new bullish level as a warning sign? Not necessarily, according to AAII. The association said its data are inconclusive about whether this is a red flag. It noted:
When bullish sentiment has previously been at unusually high levels (between 49.3% and 59.7%), the S&P 500 has risen by a median of 2.9%. When bearish sentiment has previously been at unusually low levels (between 10.6% and 20.5%), the S&P 500 has risen by 4.5%. In comparison, the S&P 500 has realized a median 4.7% gain for all six-month periods since the AAII Sentiment Survey was started in 1987." Fed taper pushes stock optimism to 3-year high: AAII - The Tell - MarketWatch
​
Click to expand...
TSPTALK's sentiment for next week is a big 70% positive. Contrarian speak means the market should go down for next week, into January. I'm throwing our SS out the window. Darn the torpedoes, full speed ahead.
 
Re: Sentiment

What happened in years past mean nothing. Its all about what's happening now. Honestly, there are so many systems and opinions best to stick with fundamental. Got out today decent gain. I'll take it. Here,s my opinion- Timing will outperform buy and hold this year. Maybe. Cheers!
 
2014

"More particularly, the second year of the cycle—the year when midterm elections are held—tends to be volatile, with substantial pullbacks, corrections or outright bear markets not at all uncommon. The typical return during such years is just 5.3 percent, or barely half the norm. Corrections tend to be particularly violent, which is why the otherwise relentlessly bullish forecasters at Piper Jaffray are issuing a warning that while the market should post decent gains in 2014, it won't be without some turbulence.
The firm points out that since 1930, pullbacks during midterm years have averaged 17 percent." Why the market could see a 17% drop in 2014+
 
2014

I plan on entering 2014 invested, but am not sure for how long...maybe pulling the plug this Friday if the markets cooperate. It's still a challenging investing environment out there, and we're due for a pull-back IMHO. Good luck to all in 2014. BTW, IE10 blows...I need to get back to IE9 somehow.
 
January

Nordic said:
I plan on entering 2014 invested, but am not sure for how long...maybe pulling the plug this Friday if the markets cooperate. It's still a challenging investing environment out there, and we're due for a pull-back IMHO. Good luck to all in 2014. BTW, IE10 blows...I need to get back to IE9 somehow.
Click to expand...

Well, we're not off to the strongest of starts to the year are we. Starting to feel like the tide is turning a bit here and maybe it's time to visit the lilypad for a spell. Finger is getting twitchy...
 
VIX

I pulled mostly out today, 70 G 30 S, based not only on market levels but also because the VIX is now down to roughly 12.5, which is on the complacent side. I left some in equities because we're still technically in a bull market, favorable seasonality, and there may be some room to run before a more meaningful pullback. Good luck traders.
 
rising wedge



Decision Point ®: Watching the Wedge - Chart Spotlight

"Conclusion: We expect the current rising wedge to resolve downward because that's what they do more often than not. While the breakdown could be the start of a significant decline, the immediate downside target would be the support line at about 1780. At that point the downside expectation for the wedge will have been fulfulled, and we'll have to see what develops from that point forward."
 
Re: rising wedge

An all out bull rally is not totally out of the question - I need some serious spill money next week to go on a buying binge.
 
overbought

"In addition the daily RSI of the NYSE Summation Index is as well overbought and the histogram of the MACD is displaying a negative divergence. This is also a good indicator that is warning that price is approaching a top."

Weekly Technical Analysis | TheWaveTrading | Safehaven.com

32452_a.png



We're at levels that could go higher still, but caution is definitely warranted going forward. Many overbought indicators out there. VIX around 12.4 indicating complacent sentiment.
 
valuation

"The current valuation of the stock market according to these metrics has only been hit 3 other times in history. 1929, 2000, and 2007."

This One Indicator Says That The Market Is Approaching A Dangerous Valuation That


Well, that last IFT sucked, I should've stuck to my guns and just sat on the sidelines for a bit more. I'm probably going to pull the plug on January today if the markets continue to show gains. I don't like losing trades, but there's a good chance we'll see continued losses perhaps to the 1740 level before we see a snap back rally. February has been historically weak, but who knows in this market. Good luck.
 
VIX

"Although the current bounce should move higher, the weight of evidence confirms the Profit Radar Reports 2014 Forecast, which proposed a correction starting at S&P 500 (^GSPC) 1,855. Today’s rally should have further to go, but ultimately lead to lower lows."

Incredible VIX Indicator Triggered Surprising Signal - Yahoo Finance


We'll see how this plays out, but it looked appropriate with today's rally to step to the sidelines and wait for a better re-entry point. Who knows, perhaps it continue on to the 1820 range.
 
trend

"So far, the correction has been very limited, but it should increase in intensity over the next three weeks in conjunction with bottoming short and intermediate cycles. By the time it is over, we could find prices at the bottom of their long-term (purple) channel which has its origin at the low of October 2011. Then we will see if the down-trending long-term cycles will permit the index to make another all-time high, or if 1850 will turn out to be it. If the long-term high has been reached, it will be reasonable to expect that high to also be the top of the bull market."

Market Turning Points | Andre Gratian | Safehaven.com


 
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