Uptrend's Account Talk

[Uptrend]

The retracement has started. The market had a bull run, now IMO we retrace a bit. Still looking for spx 734 -768 target.

All this talk of bottoming -really?

"FHA loan delinquency rates are rising. Fannie Mae and Freddie Mac 90+ day late payment rates are surging. The number of borrowers who are “upside down” — meaning they owe more on their mortgages than their homes are worth — continues to climb month after month."

"We’ve gone from “all terrible” news to “slightly less than terrible,” I can’t find any evidence of any kind of lasting, V-shaped recovery or even a dramatic turn."

http://www.moneyandmarkets.com/mark...r-plan-shenanigans-the-economy-and-more-32979

 

[Steadygain]

"We’ve gone from “all terrible” news to “slightly less than terrible,” I can’t find any evidence of any kind of lasting, V-shaped recovery or even a dramatic turn."

As usual - your posts are 'much appreciated'

All terrible to slightly less terrible - and please know I'm not saying this to be argumentative (or trying to pick a fight). BUT this simply gives an opportunity to express my personal analysis.

Since 2008 - over 5 million jobs have vanished (Of course even this figure is HEAVILY DOWNPLAYED - because the government always AND WITHOUT EXCEPTIONS uses 'fuzzy math' to give their figures.

BUT - the 'Jobless Rate Loss' is one of the most central aspects I use to determine the 'REAL STATE' of our Economy and subsequently a more accurate messure of what we would define as a Recession with Depression Characteristics.

ANYWAY - I see the news as getting more terrible. If you follow the 'Jobless Rate' most of 2008 was unremarkable UNTIL I posted we are undoubtedly in a RECESSION and went to safety. Since that time the RATES HAVE PLUNGED - with 2009 being THE WORST.

I share this to amplify your POST - in that what is virtually happening to the general population and the incredible rate and magnitude by which it CONTINUES to occur - can in NO WAY support a sustained 'V - shaped Recovery or even a dramatic turn' at this point.

I DO BELIEVE WE ARE HEADING IN THE 'RIGHT DIRECTION' AND THAT THE EFFORTS OF THE OBAMA ADMINISTRATION - AND GLOBAL COOPERATION ARE SOLIDLY ON TARGET. But rough times will follow.

 

[Birchtree]

I know it's not easy to see a sustained rally in the midst of so much remaining negativity but the bottom line is that markets love to do what most people don't expect and the indicators are sitting with the bulls for now. Late 2002 and early 2003 was absolutely a classic SPX bottoming period and today's SPX action mirrors these bottoming patterns of behavior very well. Sustained extreme volatility only happens in bottoming periods. If the VIX can break support at 40 watch out for the rocket blast off. It's only after all the traders and investors have been scared into selling near the bottoming lows have sold that the subsequent rally can launch. Stock markets bottom when almost no one expects it. Bulls are born in despair. Hesitation in this climate can be costly. Already the Dow has gained 23% from its lows on March 6th. The SPX is up 25%. A 30% gain would put the SPX at 878. Watch for it this month.

 

[Uptrend]

This journal interview with William Black is absolutely stunning! The Real Truth. The real cover-up and the government is involved out of fear! The financial failure is a Giant PONZI Scheme. And it is far from over! The mark-to-market rules that now allow banks more freedom to value assets, will allow more lying -more fraud. The real truth is that the underlying securities are worthless. Write your congress person and demand an inquiry into top CEO's of banks who are hiding the truth. And demand that the administration follow the law. After all, it's our money that is being thrown at the problem.

http://www.pbs.org/moyers/journal/04032009/watch.html

 

[KevinD]

This journal interview with William Black is absolutely stunning!

http://www.pbs.org/moyers/journal/04032009/watch.html

Interesting.

Must watch video.

Thanks.

 

[Uptrend]

Today's slip was expected. The market has failed several times around spx 845.

So far in this Bear market, we have two possibilities in Elliot wave theory to help us position our trades. Bear markets always have an overall ABC pattern. That is, a wave 5 wave down, a three wave up and a five wave down. That is the big picture and they they unfold as 5-3-5. Each 5 wave down unfolds as 1 down, 2 up, 3 down, 4 up and 5 down. The 3 wave unfolds as 1 up, 2 down and 3 up.

First market scenario
The first 5 downwave set concluded in March 08. The second 3 set uptrend concluded in May 08. The third 5 set of downwaves concluded in March 09. In this case we have bottomed and are coming off the market lows.

Second market scenario
The first and second wave sets unfolded as shown above. The third 5 downwave is still unfolding, and we are in wave 4. This is an alternate count of this 5 set. Remember, waves 2 and 4 of the 5 downwave set are counter rallies. With this scenario, we are ending the uptrend of wave 4 and should be rolling over and starting the 5 downwave set which will take us to new market lows around spx 500. If the market moves above the last high of spx 943 in the coming days first, this cannot be a viable possibility. But until then, it is, and caution is advised. The bear is not dead, yet.

 

[Uptrend]

Here is a chart of what I think might happen:

View attachment 6157

http://spyswings.blogspot.com/

This can be viewed as a bullish descending wedge. You can see we are at the top of the trading channel at 4, and 5 is down there around spx 550. We know the day before the holiday is light trading and usually green, with a red the day following a holiday. We know the $VIX is at the apex of a pennant that took several months to form and will break-out one way of the other within the next few days. Last chance tomorrow to flee to safety?

Trade carefully.

 

[KevinD]

Seams reasonable to me but what do I know.

 

[Uptrend]

I see no reason for celebration. The spx has closed above the resistance line as shown in post #667, but if it falls back on Monday, that is not confirmation of an uptrend and longs should worry a bit. Many times a fake-out occurs.

Looking at the financials, I am unssure what to think. More soft-peddling their debt by glossy statements? Wells Fargo earnings was sugar coated words. So they made 3 billion in Q1, as they borrowed 25 billion from the gov. How do you figure that as a profit? Furthermore, IMO delaying the stress tests will only create suspecion, and should end up killing the rally. Keep in mind Wells Fargo was one of the stronger banks.

So, combining technical and news data, I see 2 possibilities. First, if we close above spx 848 for 2-3 trading days, then the rally, as illigocial as it appesrs, will continue higher, and time for an IFT. Secondly, if spx fails tomorrow and closes below 848, the market has not confirmed an uptrend.

Right now the futures are at 848.75 the indecision point! Imagine that!!

 

[coolhand]

Right now the futures are at 848.75 the indecision point! Imagine that!![/COLOR][/B]

Yep. Da boyz are certainly not making it easy for bulls or bears. Same ole, same ole. I definitely do not think the bear is over, but would not be surprised if we had more upside left. I'm not feeling too left out though. As we continue higher the potential for it to come crashing down increases. It's all smoke and mirrors.

 

[coolhand]

Looking at the financials, I am unssure what to think. More soft-peddling their debt by glossy statements? Wells Fargo earnings was sugar coated words. So they made 3 billion in Q1, as they borrowed 25 billion from the gov. How do you figure that as a profit? Furthermore, IMO delaying the stress tests will only create suspecion, and should end up killing the rally. Keep in mind Wells Fargo was one of the stronger banks.

[/COLOR][/B]

Here is some mandatory reading for anyone watching financials. I've said before that Mish Shedlock is my favorite economic blogger. He's very consistent and a no non-sense kind of guy who calls it like he sees it. This latest blog tells me to look for the bear to rear its head again at some point.

http://globaleconomicanalysis.blogspot.com/2009/04/time-to-breakup-goldman-sachs.html

 

[Uptrend]

Spx is sitting at 848. This is the downtrend line and indecision point. Market is hiding it's hand. So, I cannot make an IFT move out of G today. Rally could be pausing or topping. Technicals are no help right now, until we move away from this resistance line - either break down or up. Cheers to those who have racked up %%% in April!

 

[Uptrend]

SPX closed above 848 yesterday. And staying above today. So it appears that the uptrend continues. As illogical as it seems, the impulse waves of uptrend continue. Could be as much as 15 -20% more upside. Imagine that. Don't think the Q1 earnings will be as bad as expected, because expectations are low already.

IFT to 60% S 25% C and 15% I

 

[Uptrend]

Market closed below spx 848 so the resistance line holds. I consider this a failed trade and have bailed to F. F is forming a wedge on AGG and $TNX which should break soon enough. I expect bonds to act as safety in the coming storm for short-term.

Just before IFT time we had confirmation that a uptrend was continueing, but an hour later the bears came out. Fickle market, and faked me out. Lesson learned is to wait 2 trading days closes after a major resistance or dwontrend line is breached to make sure the market stays above.

Real hard to trade within part trading day timeframe and 2 IFT limitation.

I am now bearish on the market and think we go down, after a somewhat negative indecision day tomorrow.

 

[Uptrend]

The market is hiding it's intent. The longer we play around spx 848 the more chance we go down. Two possibilities:

A) The market rolls over from about spx 848, the top of the downtrend channel, and falls to new lows at about spx 550. (I know you don't want to hear it, but get prepared.) This completes EWT wave 5 and then we rally. To invalidate this possibility, the market must rally above spx 943, and get there within several weeks form now (it's a time factor for price pattern, and time).

B) The market keeps going up in the current rising wedge to spx 864, and then rolls over and falls to about spx 789 to 810 area. The market would then rebuild to the spx 860's and then fall down to the spx 800 area and then climb again in the coming days. This would be building the double right shoulder of an inverse head & shoulders pattern, that is similar to the current left shoulder. From here there would then be a breakout at some point in the future.

Take your pick. Scenario #1 is terrible, and assumes the bottom is not in. Scenario #2 will have some bumpy falls, and assumes the bottom is in at spx 666.

 

[turbo23dog]

Today's close at 865 seems to confirm your Scenario 2...

 

[Uptrend]

No end to the recession.

Banks made money in Q1 by accounting rule changes that let them make one time write downs (example bond losses), and using borrowed taxpayer money for short term investing. It cannot be sustained. This is an excellent article, on why the market exploded to the upside (short covering rally) and why it is doomed to fail. Read the bottom half of page 2.

http://online.barrons.com/article/SB124000857570530541.html

 

[Birchtree]

"Lacking any deep familiarity with the arcana of credit swaps and the like, we can't swear to the accuracy of this analysis." That pretty much says it all - besides Rosenberg always wears a fur coat and is now no longer employed with Merrill. Good riddance.

 

[Uptrend]

Ok Birchtree, lets see what Professor Bill Balck is saying, more proof all is not well.

Stress Tests are a Sham!!


http://www.liveleak.com/

Then type in: /view?i=426_1239912356

Time to take short positions IMO. There are many technical reasons the market is toppy. For example the put/call ratio is too bullish, and this is a good contrarian indicator. When the market and public understands that the stress tests mean nothing, then the next shoe will drop. IMO we test spx 848, then s[x 800-810, then spx 780 and then perhaps spx 745. This should develop within 2-3 weeks. Taking out the March lows of spx 666 is still on the table.

 

[Birchtree]

None of the fundamentals are going to matter at this point - there is a buying panic about to take place as money goes back to work. The bull matket does not have to be rational to move forward because it is a discounting mechanism and omnipotent in nature. Many indexes are already trading nicely above their 200 day EMAs. The SMA is at SPX 983. What if the market doesn't correct, what if it just continues to climb higher? Keep a lookout for Goldilocks.