Short Term Outlook

[guppie]

Is anyone else paying attention to the dollar trade? The S&P has been tied directly to the dollar for 2 years, but suddenly it does not seem to matter. I am wondering if this is pointing to an actual recovery in fundamentals, or if there is a tipping point with a violent downdraft in our near future that will bring the dollar trade back to par. thoughts?

 

[Minnow]

Is anyone else paying attention to the dollar trade? The S&P has been tied directly to the dollar for 2 years, but suddenly it does not seem to matter. I am wondering if this is pointing to an actual recovery in fundamentals, or if there is a tipping point with a violent downdraft in our near future that will bring the dollar trade back to par. thoughts?

Frixxxx would be the currency man. Just my 2 cents: the eur/usd is sort of pricing in the upcoming downgrades and the market will catch up. But, as with all things "market" -- timing is everything. As Clester pointed out and I will paraphrase -- don't fight the tape!!! Good luck!!!

 

[clester]

Is anyone else paying attention to the dollar trade? The S&P has been tied directly to the dollar for 2 years, but suddenly it does not seem to matter. I am wondering if this is pointing to an actual recovery in fundamentals, or if there is a tipping point with a violent downdraft in our near future that will bring the dollar trade back to par. thoughts?

All they talk about on tv is the eur/Usd. I agree with the argument that it's not the fear trade or risk on trade, it's the strength in US. Or at least we are the best economy right now. QE is probably off the table as well which would support the dollar.

 

[Birchtree]

In the 1990s equity markets in the US rallied as the US dollar rallied as well. The main idea is do not let currency movements trick you into thinking that a strong dollar is bearish for equities. If anything, it would further the case for a good move into equities into 2012 as the economy begins to boom.

 

[Minnow]

In the 1990s equity markets in the US rallied as the US dollar rallied as well. The main idea is do not let currency movements trick you into thinking that a strong dollar is bearish for equities. If anything, it would further the case for a good move into equities into 2012 as the economy begins to boom.

I wouldn't predict a truly booming economy in 2012 but I've been wrong before. The true economy and the markets ignore each other on a regular basis.

However I fully agree with your opinion on currency movements and the tricks they will play.

Mindy Lou given you any winners lately?

 

[clester]

Uptrend still intact. S&P has moved sideways for 4 days now. Maybe it's a high base and instead of a pullback it's just a sideways movement. this is positive although it could also signal of the market losing momentum. I don't think so though. On European news like we have been getting we usually get a bigger pullback in US. So, there is a change out there.

 

[tsptalk]

Agree nice chart... but the indicators are "iffy". As we get into earnings season we could get some clarity.

 

[clester]

This morning futures looking good but will it hold. On the plus side the Vix is low and the size of the moves in the market have calmed down. This rally looks more like past up trends where we make small moves and are in a general uptrend. A melt up, if you will. If we get a day that is up over 2% I would probably sell because that may be a blow off top.

I am surprised we haven't had a pullback. We are probably due but it should be short unless we have a big Europe blowup.

 

[clester]

I am surprised we haven't had a pullback. We are probably due but it should be short unless we have a big Europe blowup.

looks like we may have a pullback today. That would be good as long as its not too much. I wouldn't be surprised if we have a retest of the high base about 1275. I'm watching the RSI. If it gets to 70 it may indicate a short term top.

 

[clester]

looks like we may have a pullback today. That would be good as long as its not too much. I wouldn't be surprised if we have a retest of the high base about 1275. I'm watching the RSI. If it gets to 70 it may indicate a short term top.

The pullback still hasn't happened as the bulls are pushing the market up and buying the dips. Seems sentiment is almost too positive and so I am looking for signs of a short term high. Watch the RSI. Once it gets above it there is usually some selling.

 

[clester]

Our pullback is here and it feels like a do or die because of all the news out. France downgraded, Greece nearing default again, our good economic numbers. Also, we usually get a counter trend around 3 day holidays. So, is this just the pullback we were looking for or a beginning of something worse. 1275 support held so far but it's a long weekend to be holding long. I'm thinking of doing that though.

 

[tsptalk]

Good point on the holiday. It could just be the pre-holiday fake-out that gets reversed after the holiday

Great - something else to consider.

 

[clester]

Good point on the holiday. It could just be the pre-holiday fake-out that gets reversed after the holiday

Great - something else to consider.

Yeah, I wonder if it's a fake out and the limited trades make it hard. I only have one trade left.

 

[tsptalk]

I like that the S&P has crawled back into the recent trading channel after the initial emotional reaction to the downgrades. It needs to hold there.

 

[clester]

Yeah, I wonder if it's a fake out and the limited trades make it hard. I only have one trade left.

Perhaps it was a fake out.

I have to admit I am getting a little nervous with the rally like several others here. But, the market can go further than we think in either direction. At this point in a rally I tend to rely on indicators and trend lines because my emotion may cause me to make mistakes. So, I am still watching the RSI because a reading over 70 doesn't happen often and usually indicates a near term top or bottom. The trend is still up, so I will be watching the trend line from the lows. Also, if today's early pop doesn't hold I would get concerned.

 

[Appatite]

Perhaps it was a fake out.

I have to admit I am getting a little nervous with the rally like several others here. But, the market can go further than we think in either direction. At this point in a rally I tend to rely on indicators and trend lines because my emotion may cause me to make mistakes. So, I am still watching the RSI because a reading over 70 doesn't happen often and usually indicates a near term top or bottom. The trend is still up, so I will be watching the trend line from the lows. Also, if today's early pop doesn't hold I would get concerned.

We are going to blow the roof off this sucker this week.

Looking for 5%

 

[RealMoneyIssues]

Looking for 5%

1353... not likely, at least on this move...

 

[Dutchy]

It will be interesting to see if Smart Money fades the rally this morning... I expect a nice pop through mid morning then fade throughout the day..

 

[Appatite]

1353... not likely, at least on this move...

Im not feeling the love here.

How about 4%?

 

[nasa1974]

Not getting the warm fuzzy here. It looked the VIX was going to fall below 20 early, but now it might go above 21. Going to be a nasty ride I think.