DEADShort term sentimentsDEAD

vin · Posted: Thu Jul 06, 2006 8:35 pm Post subject: DEADShort term sentimentsDEAD

New here – mostly swing trading. I’ve been searching for a serious site and believe I have found it here. Mr. To’s commentaries are excellent. Let’s cut to it - I for one am spooked short term (1-3 weeks). Here are my reasons:
First, the current rally just doesn’t seem to have teeth. The move up on June 29 seemed exaggerated. It was just a big ‘Hurrah, the Fed did what we expected.’ Many read a future pause into Bernanke’s statement but who knows? It’s almost as if the market ‘willed’ a rally.
Second, after this delayed follow through day the major indexes responded with a pullback on increased volume (modest in percentage loss).
Third, two days prior (June 27th) all three indices had what I call a ‘heave day.’ They climbed over the previous day’s high only to close lower than the previous day’s low – all on increased volume.
Fourth, there was no doubt some end of the quarter window dressing and short covering.
What has happened since? Some call it consolidation; I call it distribution and selling into bounces. The accumulation volume has been anemic. Although the holiday week clouds things the leading events remain.
Lastly, the most important thing is the gut. Something makes me feel very uneasy (see below). Maybe it was the synthesis of what I mentioned above; maybe I am worried about locking in gains on this recent move up. Nevertheless, I liquidated everything except LEN as I don’t think homebuilders can get beat up much more (gee, wonder where I got that idea?).
North Korea lobbing missiles into the sea doesn’t help. I think there will be one more shakeout before we test old highs again. I don’t know if we’ll sink to (or below) the mid-June lows, but it could be painful. Predictions are pretty much worthless until events transpire. I’m only building an arguable case. The market doesn’t care or need reasons to steamroll every naysayer out there. Let the tape decide.

Side note: I was reading my Bible before the market opened and came across these verses:

“With her enticing speech she caused him to yield, with her flattering lips she seduced him. Immediately he went after her, as an ox goes to the slaughter, or as a fool to the correction of the stocks…” Proverbs 7:21-22

I don’t claim to have divine intervention on my side, and starting my day with this verse might have been what spooked me. Take it for what it’s worth, but the wording in this verse is uncanny in its application to bulls running up a blind (r)alley. The Bible remains the best book on investing ever written (not to mention the invaluable spiritual content). If you don’t have one, get one.

rffrydr · Posted: Fri Jul 13, 2007 1:22 pm Post subject:

Economic news doesn't give you that. Too many shorts going into that good ol' wednesday before the week of expiration with SP, Moody's downgrades to get 'em loaded up--getting to be old hat but still working.

The OILS--that's another question.
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Today is the Tomorrow you worried about Yesterday!

Goodfella · Veteran Poster Joined: 14 Oct 2005 Posts: 301

not to mention the "hedge fund" managers that are sitting on the fence lol

HenryTo · Posted: Fri Jul 13, 2007 10:46 am Post subject:

No doubt, there are now many folks out there who are confused - and for those that are shorting, hurting. I have no comments at this time, but will wait until Saturday or Sunday to comment.

Take care guys,

Henry

rffrydr · Posted: Fri Jul 13, 2007 10:27 am Post subject:

Don't know what the sample base is or how Yale of all places is going to fing them but then why are they falling over themselves to buy a Chinese life insurer with its crony loans and Goldman valuations? See below.
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Today is the Tomorrow you worried about Yesterday!

dash · Veteran Poster Joined: 12 Apr 2005 Posts: 473

rffrydr · Posted: Thu Jul 12, 2007 4:24 pm Post subject:

I think we saw some of your shorts flushed today, Dash. I'm glad they got my oils last week. Hangin' tough on X though--may even double up.

ISE intraday sentiment has been "refined."

http://www.ise.com/WebForm/viewPage.aspx?categoryId=126&header3=true&menu0=true&link1=true
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Today is the Tomorrow you worried about Yesterday!

dash · Veteran Poster Joined: 12 Apr 2005 Posts: 473

NYSE TRIN closed at 0.39. By this measure the market is extremely overbought. No surprise I guess given today's action. Has me sceptical about the ability of the market to follow through though, and wondering about the possibility of a bull trap.

diesel · Posted: Thu Jul 12, 2007 1:16 am Post subject:

The 4th Hinderburg Omen was generated yesterday so we are on a confirmed Hindenburg omen. The last confirmed Hindenburg omen came before the May selloff last year.

dash · Veteran Poster Joined: 12 Apr 2005 Posts: 473

http://www.bloomberg.com/apps/news?pid=20601084&sid=avQQ2OnMlzNM&refer=stocks

dash · Veteran Poster Joined: 12 Apr 2005 Posts: 473

The short-term model I follow cycled from overbought last Friday, to oversold yesterday, so today's bounce is right on cue. NYSE and Nasdaq intraday cummulative TICK is especially oversold.

I'd like to see:
% of SPX stocks trading above their 200DMA get below 50 (currently 70)
% of SPX stocks trading above their 50DMA get below 30 (currently 49)
% of SPX stocks trading above their 20DMA get below 20 (currently 38 )

I think this would give the SPX enough 'fuel' to join the NDX on a decisive break of recent highs. Hopefully we see that if there is another leg down.

nodoodahs · Moderator Joined: 06 May 2005 Posts: 1862 Location: TX

rffrydr · Posted: Wed Jul 11, 2007 9:31 am Post subject:

Don't you think that's becoming more of a "retiree sentiment index"?

With many of the financials pinned at March lows you'd expect something like that. But with yesterday's post-holiday bloodletting good ol' CAT up almost 2%. Biggest outflows in May going into the world story: I still think bearishness here is bullishness over there.
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Today is the Tomorrow you worried about Yesterday!

dash · Veteran Poster Joined: 12 Apr 2005 Posts: 473

Odd lot short sales were above 7 million yesterday. That was almost as high as the record high in early March.

dash · Veteran Poster Joined: 12 Apr 2005 Posts: 473

rffrydr · Posted: Tue Jul 10, 2007 9:34 am Post subject:

I think the cautionary note speaks to his instincts: he doesn't want to hang his hat on "derivatives."

Broadly speaking, do you think this maturing trend towards income streams, "Absolute Return," "Seeking Alpha," chasing commodities, and real estate before, and even the heavy, heavy commitment to the OILS is, at its heart, a grand expression of bearishness? --A symptom of a millenial bubble?

If so, what do you think a "cover" would look like?
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Today is the Tomorrow you worried about Yesterday!