Nope, it's a problem

Given the problems with the Euro zone again, bullish calls are off. We will have to wait for December to see if it improves.

Last week of November

Saw a reversal of morning star last Thursday with a pause on Friday. Looks like a bullish last week of November if the Irish bailout has no problems.

We got a good Rally....

Now time for the bears!

November

November is here! We had a jittery October. Right now is that we are shy from the highs - Another resistance to break. If DOW can break it, then we are up for another good rally.

Oct

Been really busy this month. October seen a rally that keeps pushing forward. But right now are we at a market top?

Is fear coming back?

VIX which is know for its indicator for fear and volatility seemed to be breaking out of the triangle pattern. IS FEAR COMING BACK?

Stocks Broke Out, but Can They Hold Gains?

That was pretty unexpected. DJI broke out of resistance on Friday. This year is a year which broke many traditions. Seems this September is a up month. Gold touched an $1,300 per ounce. There is still uncertainty for next week till the end of September.

Side story

Looking at the chart of Genting Singapore, it's kinda going parabolic. What goes up, must come down - HARD. Of course this pattern is unpredictable as you won't know when the stock is going down. It just keeps going up, up, up, up till someone starts dumping it.

Does rally still have legs?

High volume on a day of uncertainty. I remain cautious. If it goes down again, we got a head and shoulders forming or a triple top.

MONDAY: NAHB housing market index; Nike shareholder meeting; Oracle Open World; Earnings from Lennar and Discover Financial
TUESDAY: Housing starts; FOMC Announcement; Clinton Global Initiative; MasterCard annual meeting; Earnings from AutoZone and Adobe
WEDNESDAY: Weekly mortgage applications; oil inventories; Wall Street & Washington Conference; Earnings from General Mills and Bed Bath & Beyond
THURSDAY: Weekly jobless claims; existing home sales; leading indicators; Chicago Fed Pres Evans speaks; Volcker speaks; FCC meeting on opening up new airwaves; Earnings from Rite Aid and Nike
FRIDAY: Durable goods orders; New home sales; Richmond Fed President Lacker speaks; Philadelphia Fed President Plosser speaks; NY Film Festival; Earnings from KB Home

Out of 200 SMA

We got a rally and we broke through the 200 SMA. Yesterday we had a pause in the rally. Right now we are in the month of September. In September it is traditionally flat till October. Looking at the low volumes too, markets probably gonna consolidate.

Up again?

Well, seems my support theory is holding well though it was weaving in and out of that territory. MACD looks towards an upside. However US economic situation isn't looking very bright. It's stalling. It was Friday's Job report propelling the rally on Friday but it declined slowly as people started digesting the news. Based on technical analysis, we still have that 200 day SMA to break. Also we already have the "death cross" which signals for another long term downward movement.

Still not looking better

Things are still not looking better for the US economy. Again disappointing jobs numbers. The 200 MA is still a tough nut to crack. We are back below 200 SMA again. Selling volumes are higher so expect more downside? We should reach a support soon at 10000 points. But there's a silver lining. Look at the baltic dry index.

Up or down?

After much upside, we seem to be hitting a ceiling. There's a fight of bulls and bears again. Bears are trying to bring it down but bulls pulling it up the last minute again.

"Volume was light, with less than 950 million shares changing hands on the New York Stock Exchange. Decliners outpaced advancers, roughly 8 to 7"

Low volume don't seem to tell me it's a bear. But probably stocks will come down the coming week.

For Singapore, we didn't get our National Day rally on Friday. So hopefully we will get a post National Day rally on Tuesday.

Touching the 200SMA

I like this chart. Bulls are definitely incharge right now. We got a volatile 3 days where bulls and bears were fighting with each other and then boom! Bulls win. If we break pass the 200 SMA we are in for a bull run. Then again if you read the news, people are not too convinced about the standard in the European banks stress test.

Dow Drops 1% for Week; Bank of America Tumbles

Guess I was wrong about the direction. DJI failed to break out of the 200 moving average. Friday's report on consumer moods was really bad and it brought down 261 pts. Earnings from banks were not stellar. Looking at Friday, it could be a downside as volume was high that night. However next week will be heavy on earnings as there is a huge number of companies reporting their earnings. So get ready for a volatile week.

Earnings season

Opening by Acola and then intel, earnings season seem to be looking good. Some other companies are smashing expectations also. Still maintaining bullish with a consolidation as there was a huge bull. I don't want the market to be overcooked.

More to come:

THURSDAY: PPI; Empire State survey; weekly jobless claims; industrial production; Philly Fed survey; Yellen nomination hearing; Fed's Lacker speaks; Earnings from JPMorgan, Novartis, Google and AMD
FRIDAY: CPI; consumer sentiment; Earnings from Bank of America, Citigroup, GE and Gannett

Reversal

Spotted a reversal on Monday and yesterday has confirmed the reversal. DJI going on the upside now.

Down down down

Well, didn't I say there was a downside coming? Well it did, looking at fundamental data from US last week and this week, it seems that recovery is far from rosy. Friday was an important day as many investors were waiting for the jobs data to see where the market can head. A good data will push market up, disappointing data ends up down. Result? Disappointing jobs data in addition with disappointing factory orders continued the downward slide. Some analysts were talking about head and shoulder formation in S&P500. It has already broken through. Now it could be a bearish market instead of a correction.

In my opinion, it's a bearish and mixed. Cause looking at Singapore side, the economy is reporting extremely well recovery and progress. While the western side is reporting disappointing recovery. Very confusing indeed.

For now I'm sticking to the bears for next week till I see a turning point.

Get down

Well after a few reversals, the market went down. Alot of disappointing results such as housing brought the DJI down. Hit a support on Friday with a doji. We shall have to see if the market continues downwards as selling volume is very strong. MACD signal is also bearish.

Unpegging of Yuan to Dollar, Good news or bad news?

Well China has unpegged it's Yuan to Dollar. And this news caused Yuan to surge. Is this good news or bad? It seems good news to every country as it means China now has the appetite to be one of the largest importer. It might be not so good to China in longer time period. As the biggest exporter to the world, rising yuan may hurt its export business. Right now it's a big talk about expecting more expensive import goods from China such as food and consumer products. Rising yuan leading to inflation?

Hits another resistance

After a few disappointing results like housing starts and Philly industrial production, DJI tries to move up. Friday we had quadruple witching which is traditionally the most volatile day where fund managers are doing window dressing of their portfolio. Ended up again for Friday and gold was soaring. Now looking at the chart, I'm seeing 3 reversal candles + hitting 50D moving average. Looks like we could go down for a ride or if we are lucky, a consolidation.

Things to look for

TUESDAY: Fed's Bullard speaks; credit card default rates expected; E3 video game conf.
WEDNESDAY: Weekly mortgage apps; PPI; housing starts; industrial production; weekly oil inventories; Fed's Plosser speaks; Disney insider trader hearing; China trade hearing; Earnings from FedEx
THURSDAY: CPI; weekly jobless claims; current accounts; leading indicators; Philadelphia Fed survey; BP CEO testifies
FRIDAY: Quadruple witching; S&P indexes rebalanced

200D MA Tested again

Stocks snap 3 weeks losing streak

Right, since my last post, the market went down instead of rebounding on my support, but it rebounded back later and went up. The last candlestick forms a hammer, so most probably markets will reverse into downtrend or consolidate again. We are going to test the 200D MA again.

I'm seeing a slight divergence in the MACD so this could mean a uptrend might be near.

These few days STI and DJI are not in sync with each other. So it's difficult to read the market movements recently for stocks in Singapore.

Sell off

See? A disappointing jobs figures on Friday pulled the DJI down. We are back to trading range again. Failed to clear 200D SMA. Will we see a rebound again on Monday?

Ekes out a gain

DJI ekes out a gain last night due to a last minute rally, but it's still hovering below the 200D SMA. This resistance is hard to break as it has been tested about twice. By right a good jobs report on Friday could break the resistance BUT futures are tanking now as Jobs report disappoints.

Dead cat

Dead cat bounce.

But tonight may be a rebound on a support. Futures look green.

End of May

We are ending the month of May with a big thud as we fell all the way back to the February low in just one month, erasing all gains that took months to build. We got a hammer, then failed again but it formed somewhat a inverted hammer, then a huge gain and finally a down again. Well the pre-holiday mood didn't help to push the US market up. Right now we are stuck below SMA 200D. Will it be another dead cat bounce or and upside soon?

Hammer

Have been really busy this week! Sorry for the lack of updates! I shall start from my last post where I said a probable rebound. We can't predict what will happen and North Korea certainly sprung a surprise with a likely war with South Korea, followed with lack of confidence with Europe troubles. And thus a downside. We started with a huge loss in the Dow and it recovered back most of the losses hence forming a hammer (you can look up what is a hammer). This very strong hammer signals a likely reversal especially on the strong previous support. So as usual, we need a confirmation. (Last candle not valid as the market running now as I type).

Rebounded

The failed pattern was so amazing, stocks just plunged! Then on Friday, it was volatile but the Dow rebounded again. Will it hit a resistance and go lower? Seems to be one more down wave to happen.

What's seems to be encouraging is the upside volume!

Failed pattern

This is kinda bad. A failed pattern indicating more downside. Hedge funds are shorting.

Ignore last candle. But looks bad.

Dow ekes out a gain

Well it was certainly volatile! Very interesting... last night Dow started red and became redder almost reaching -200 pts. Then I woke up in the morning and saw that Dow went back into green. What's the reason for this? CNBC quoted that professionals are buying in on the cheap price causing erasing of the losses. Volumes seem abit higher than normal. This forms an ugly hammer. Good thing. Just need a confirmation to the upside again. I hope this is not a prelude to double top.

Investing the wave basics

Hi! I have added a new blog called "Investing the wave basics". It's specially for beginners to read and understand how the market works. It will be useful for you! Check it out at Investing the wave basics!

Not bullish yet

Darn, it was truely a dead cat bounce. I was wrong about being bullish. We have to see if it bounces again on the 150 MA or 100 MA. It might go up and down like a rollercoaster.

Where are we heading?

We rebounded as I mentioned in the last post. Ignore the last candle cause I was running real time charts and DOW was open while typing this entry. DOW rebounded at the 150 MA instead of the 200 MA I mentioned. It really volatile now and it's quite difficult to give a call especially when it is in MAY. Right now I see is a bullish sign upwards, however volumes are decreasing. There is still not much people buying as probably again the shock from Europe's problem. Gold is surging as investors are trying to hedge over stocks and Euro dollars? Euro dollars is dropping like mad as many like George Soros are shorting the Euro dollars. Euro dollars is doomed?

It's the end of dividend giving stocks. So what's to invest is in companies with good profits and strong cash flow.

Hopefully this is not a slow bleed of stocks. It will really defeat the purpose of buy and hold.

Months of Bull, Wiped out in a matter of days

I'm back, however back at a really bad time. For the last 4 days DOW just PLUNGED, basically wiping out months of accumulated profits due to Europe's problem. Coincidentally, this news exposed during the month of May, where there's a saying "Sell in May and go away". Sometimes it makes me wonder that if news are specifically released deliberately at certain timings or it's just a matter of twisted fate?
Take a look, In just a few days, 50, 100, 150 Moving Averages (MA) are broken. That's even faster then the correction during January - February! What's left is the 200 MA(green) support. If that is broken, then it's a really bearish period. The drop in the last few days really shook off the confidence of many investors when they are starting to put their money back into assets. My portfolio consisting of long term stocks also took a bad hit.
Let's take a look at VIX, an indicator which measures fear. VIX has broken out of the downwards channel. Which means that there is more fear to be expected and more drops. I'm anticipating a rebound soon which probably a "dead cat bounce" since the drop is really fast and furious. Probably at the 200 MA support.

Of course there will be opportunities.

*A pinch of salt: I dreamt there was a formation of a head and shoulders! I wonder this is just a formation of a left shoulder? or a head?

On Leave

Hi guys, I'll be on leave for a while due to exams. Will update again during the month of May!

Good luck and trade carefully!

Dow Briefly Pops Above 11,000; Chevron Gains

DOW again tested the 11,000 resistance. I thought there will be a slight correction but that's really a slight dip (where's the correction??). It seems that investors are lapping up stocks once that dip came. However it seems that low volume movement seems to be the new trend and seems no one dared to short the market. I'm not complaining if this new trend is very sustainable.

Probably the reason of a low volume is that there is still fear of the repeat of 2007 run up of stocks. You should know what happened after that year which is the fall of Lehman Brothers. This year the fear is that there is another fall - Greece. Hence retail investors are still on the sidelines.

Next week will be the start of earnings!

MONDAY: Earnings from Alcoa
TUESDAY: Trade balance; import/export prices; Fed's Lacker speaks; earnings from Intel
WEDNESDAY: Weekly mortgage apps; CPI; government's retail-sales report; Fed's Pianalto, Lacker, Warsh & Fisher speak; business inventories, crude inventories; beige book; earnings from JPMorgan Chase
THURSDAY: Taxes due; Empire state manufacturing survey; industrial production; Philly Fed report; Fed's Lacker, Bullard & Lockhart speak; housing-market index; earnings from Google, AMD
FRIDAY: State unemployment rates; housing starts; Fed's Warsh speaks; consumer sentiment; earnings from Bank of America, GE, Mattel & Gannett

11,000 resistance

11,000 is the resistance we are seeing now. Seems like Greece problems are still there.

April

We are in April now, which is said to be one of the traditionally bullish month. Q2 results are in season now so we shall see if stocks can still go bullish. On Friday, Gov announced that non-farm payrolls increased by 162,000 in March. So we may see another rise on Monday. Are jobless situation improving? I think still waits to be seen as people will digest it during weekends.

The payrolls increase was the largest since March 2007. About 48,000 temporary workers for the decennial census were hired last month, less than some anticipated, while private payrolls jumped 123,000.

"The real surprise is the low number of census and temp workers, slightly more than half of the 162,000 gain in March. Traders and investors will see this as a good sign once they digest the figures over the weekend because permanent hiring was much better than anticipated," said Schoenberger.

Chart looks like a consolidation still.

STI broke resistance. http://cclor.blogspot.com/2010/04/sti-broke-major-resistance.html

Continued up

After the inverted hammer, we went on flat. I think the chart has spoken, we are still going up. This week has a good Friday, so I think market will be still optimistic and continue up.

Stocks Erase Gains After Trichet Comments

Just when I thought DOW was flying when there's good earnings reports from companies and good news along with Bernanke's speech, it ended up flat. It was a really nice rally of 100 over pts until at the end DOW just went on a dive and splat! This formed an inverted hammer, a signal of reversal or consolidation.

What Trichet commented?

Trichet told a French TV network that Greece having to go to the IMF for aid was a "very, very bad" thing and that the European Union isn't doing enough.

Those comments sent the dollar soaring against the euro and commodity prices lower. Material and energy stocks were the day's worst performers.

Continuation

Well, Tuesday broke the resistance and provided a much upsurge of the bull. The next target will be 11,000 pts. Tonight might stall looking at the futures right now. HSI and STI are going negative as more are taking profits. Are people anticipating a downside soon?

Consolidation or continuation?

Lots of upgrades last night, pharmaceuticals stocks were the top runners.

End of upside

Opps seems like there is no more upside. A down tonight will signal end of upside.

8th Session up

No 8th candle reversal in sight, momentum will continue to go up for the next few sessions.

Dow Extends Win Streak for Lucky 7th Day

Well the Fed decided to keep it's rates unchanged and the market continued it's rally and broke through my first reported resistance. As I said in one of the last entry, we are towards the January high. Dow has already gained for 7 days. Tonight will it gain again? Or will result in the 8th candle reversal? What's driving the rally now? I think it's the currency. It will be nice if DOW goes to break the January highs and find support on it during the next correction.

Economic events to look out for

US market will be waiting for the FMOC rate decision.

Economic Events for week Monday 15 to Friday 19 March 2010
Monday:
08:30 am Empire Manufacturing Survey
09:00 am Net Long-Term TIC Flows
09:15 am Capacity Utilization
09:15 am Industrial Production
Tuesday:
08:30 am Building Permits
08:30 am Export Prices ex-ag.
08:30 am Housing Starts
08:30 am Import Prices ex-oil
14:15 pm FOMC Rate Decision
Wednesday:
08:30 am Core PPI
08:30 am PPI
10:30 am Crude Inventories
Thursday:
08:30 am Core CPI
08:30 am CPI
08:30 am Current Account Balance
08:30 am Initial Claims
08:30 am Continuing Claims
10:00 am Leading Indicators
10:00 am Philadelphia Fed
10:30 am Natural Gas Inventories
Friday:
None

S&P Closes at 17-Month High Above 1,150

Last night was a struggling night as stocks weaved in and out of positive and negative territory before having a last minute gain.

Stocks struggled to hold gains for any length of time today as investors were disappointed in the latest jobless-claims report. Banks rebounded from a midmorning dip amid signs that financial reform may get stuck in gridlock on Capitol Hill. Bailout stocks Citigroup and AIG continued to push higher.

Initial jobless claims fell by 6,000 last week; economists had expected claims to drop by 8,000.

Jobless rates are still not showing any improvement which caused the DOW to be down. It was only saved by bank rally.

Right now it has hit the resistance. If it breaks that resistance, then we might go to the January high.

S&P500 closes at the 17-month high. Now it must find support at 1,147.5 to be able to move higher.

Stocks end higher

After a few days of rally, seems like we hit a speed bump. DOW now seems to be hitting the resistance and coming back down. Well, we might be in for another consolidation again. A small drop in the DOW should make the DOW healthy and then break the resistance.

Stocks Gain 2.3% for Week

DOW gained! Saved by the the report on Friday that job losses for February wasn't as bad as expected.

The consolidation I reported last entry ended with an upside so there could be more.

However trading volumes remained light as many are still cautious.

Oh one interesting observation: Obama's speech this year always seems to kill a rally. (we shall see does it happen again on Wednesday....)

Next week's market movers:

MONDAY: NABE conference; McDonald's Feb. sales; Fed's Warsh speaks; Earnings from H&R Block
TUESDAY: NABE conference; Anniversary of market's March lows; Fed's Evans speaks; 3-year Treasury auction
WEDNESDAY: Obama health-care speech; weekly mortgage apps; wholesale trade; state unemployment rates; Google hearing; weekly crude inventories; 10-year auction; earnings from American-Eagle Outfitters
THURSDAY: $2B California bond sale; international trade; weekly jobless claims; 30-year auction; earnings from Nat Semi, Aeropostale
FRIDAY: Gov'ts retail-sales report; consumer sentiment; business inventories; earnings from Ann Taylor

Consolidation?

Seems to me is a consolidation now slowly moving down. My stand will be the downside until MACD starts to turn up again. What a rollercoster ride!

Update: Judging from today, Things are getting bullish for March. The only thing is the MACD seems to be turning bearish. If the consolidation holds for the next 2 weeks and a breakout, we might get a new bull :)

Volatile Markets

Market is very volatile this week. This year, I feel that it won't be easy to earn from stocks. Focus on dividend stocks instead.

Upcoming Market movers:

THURSDAY: Weekly jobless claims; durable-goods orders; Bernanke Senate testimony; Fed's Pinalto, Bullard speak; Apple shareholder meeting; Buffett lunch; health-care summit; seven-year auction; financial-industry compensation hearing; Earnings from Kohl's, Liberty Media and Gap
FRIDAY: 2nd read on Q4 GDP; consumer sentiment; existing-home sales; Fed's Kocherlakota speaks; Madoff hearing; Earnings from Berkshire Hathaway

Will Feb close positive?

Last week was certainly a bullish week as DOW has been closing positive. It was certainly a nice bull with nice economic reports and positive earnings. Money was back into the market. Friday was a surprise day as the Fed announced a rise in interest rate from 0.5% to 0.75% after the bell on Thursday which sent Asian markets tumbling. A knee jerk reaction I would say. Thanks to the surprise which the Fed gave, it certainly lead to more instability to the market. Looking at the charts, Friday ended as a doji. Seems like bulls are going to end soon for Feb.

Fed Raises Discount Rate to 0.75% From 0.50%

Market mover for the day. Dollar was very bullish last night even though the news was released after close!

Published: Thursday, 18 Feb 2010 | 6:00 PM ET Text Size By: CNBC.com with Reuters
The Federal Reserve said on Thursday it raised the interest rate it charges banks for emergency loans but insisted that its first rate move since December 2008 would not raise borrowing costs for consumers or companies.

The Fed cast its decision to raise the discount rate to 0.75 percent from 0.5 percent as a response to improved financial market conditions that warrant less of a helping hand from the U.S. central bank.


RELATED LINKS
Current DateTime: 02:16:00 18 Feb 2010
LinksList Documentid: 35465850
Where the Biggest Investors Are Putting MoneyBernanke Faces Challenges
It went to pains to draw the distinction between the discount rate and its target for overnight interbank rates, its main monetary policy tool, which remains unchanged near zero percent as a fragile U.S. economic recovery struggles to gain traction.

"Like the closure of a number of extraordinary credit programs earlier this month, these changes are intended as a further normalization of the Federal Reserve's lending facilities," the Fed said in a statement.

"The modifications are not expected to lead to tighter financial conditions for households and businesses and do not signal any change in the outlook for the economy or for monetary policy," it said.


Market watchers were shocked by the announcement, which came after markets closed Thursday.

“I'm shocked. Completely shocked,” Todd Schoenberger, managing director of LandColt Trading said of the Fed’s move to raise the discount rate. “It makes me wonder if the CPI number coming out tomorrow is going to be just absolutely horrible—maybe they got wind of something,” he said.

Schoenberger expects the Fed to raise the federal-funds rate, the rate banks charge each other, at its next meeting March 17-18. He, like many traders, didn't expect the Fed to make a move until the second half of this year.

The analyst expects stocks to pull back from the Dow Jones Industrial Average's recent three-day winning streak as a result of the Fed move.

"Expect a dramatic selloff at the open tomorrow morning," Schoenberger told CNBC.

The increase in the discount rate “does not mean that the Fed is ready to hike [the fed-funds rate] or has a set time for such a move. But it does mean that the Fed is preparing the way,” said Robert Brusca, chief economist at FAO Economics. “This is very much a move to prepare markets and to test markets to see if they are ready to absorb a rate increase by putting the Fed’s lending vehicles back in a normal configuration,” he said.

'Bullish for the Dollar'

The U.S. dollar reached its highest point against the euro since May of 2009 after the Fed's announcement Thursday.



“I think it’s very bullish for the dollar,” said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. “It cements the U.S.’s safe-haven status for foreign investors,” he explained.

Gold prices fell as a result of the news.

U.S. light, sweet crude futures surrendered some of their earlier gains to move near $78 late Thursday, after settling $1.73 higher at $79.06 a barrel.

Pimco Founder and Co-Chief Investment Officer Bill Gross said he sees the Fed's action as part of a much larger pullback from the government's economic stimulus strategy.

"This move is more of a classical monetary policy maneuver ... as opposed to the beginning of an interest rate increase or any tightening from the standpoint of interest rates, and I think that’s what's critical for bond investor," Gross said.

The Fed also said that as of March 18 the maximum maturity for primary credit loans will be shortened to overnight. It also said it was raising the minimum bid rate for its term auction facility program from 0.25 percent to 0.50 percent and that the final TAF auction will be on March 8.

The TAF program allows depository institutions to bid on loans from the Fed using a wide range of securities and assets as collateral. It was introduced in December 2007 as a way to introduce liquidity for financial institutions amid credit market concerns about the quality of securities being used as collateral.

Nice one

This is a very nice bull. If it can break the resistance later then we can expect another bull run.

Happy Chinese New Year

Happy Chinese New Year to all readers! Wish everyone a wonderful time! Gong Xi Gong Xi!

Last min Rally

Last night started down and was pretty much hanging in there. After that there was a rally in the end breaking out the 100 MA. A nice rally since it was able to break out of the 100 MA. Now it remains to be seen that the breakout is sustainable. These few days were very volatile, as I said many of the outcomes at the end are all surprises. At Singapore side, stocks are not moving much, indicating money are on the sidelines.