Big Picture Jan 16 2012

SPX

SPX (Zoomed in)

TLT (20 year Bond)

DX (Dollar Index)

GOLD Index

Shanghai Index

BDI (Baltic Dry Index)

We could see a market sell off within the next month or so.

Market Analysis for Week Starting Dec 05

Beginners Guide to Trading this past year. I think this video pretty much sums it all up!

This week showed signs of improvement in the US while the EZ Bonds yields continued to explode. World central banks confirmed that things are bad banks getting downgraded but we rallied 7.3% for the week. Last week we were in extreme oversold area which can explain the huge bounce. Those who went in all out long last Friday took a Huge risk. Good, Lucky or Stupid? Either way it builds bad habits that will eventually pay the piper.

Last Week I started the Week with 26% of my portfolio exposed to the markets net short for exactly the reason of what happen last week.  This week I will reduce my exposure even more down to 10% Net short again especially if we see a Gap up. The SPY has come to  profit area and bounced off of it. Could it continue to go higher? Yes anything is possible. It will be an important week to see how it plays out.

SPY

 

SPX Monthly

 Big Picture Analysis on a monthly chart. Are we near a point where the chart is saying " Gentleman prepare for radical vertical impact demonstration!"? I don't know but I did nibble on a few SPX Leaps late Friday. I plan to sell monthly and weekly puts to generate some income.

Good Trading this week!

Market Analysis for Week Starting Nov 28

Markets are screaming "HELP" after last weeks sell off. We have recessions fears in Europe and the US, while China will slow down and risks social unrest. Euro bonds Exploded higher while US hit record lows. US 5 year trades under 1 % at .88 basis points, the 2 year at .26 basis point and a 10 year treasury at 1.88%. Markel is trying to force a deflation spiral on the worlds economy. Despite the overwhelming evidence that Deflation doesn't work! At this point no fundamentals, Technical, math or logic seem to matter. The Market has decided to send a strong message to the EZ to stop their lunacy. Markets are becoming more and more immune to these stupid little BS roamers and small signs of hope. The clock has started to tick with each new low the markets make. Markel better be listening!

SPY

Last week I started out with 40% exposure to the market net long. I got stopped out from the word GO! Luckily the Shorts outperformed the Longs and the pain was minimal. By the end of the week I was up a bit as I reduced longs and added to shorts. Friday we got an extremely weak bounce that failed as a lot of charts were hitting support areas. This is a big tell, tell sign of just how bad things are.

Looking at the week ahead SPY gets a Neutral rating. Despite the fact we are in extreme oversold territory.  We are deep inside the Chop area where violent moves in both directions are typical. Newbie traders Should definitely be in all CASH! There is no glory in losing your hard earned money guessing. Remember Bottom Fishing is a FOOLS game!

I am entering the week with 26% of portfolio exposure Net Short. I will continue to hold short names like CPA, ALK, SLV, GLD, APKT, LULU, DBA, AMED, IT etc. While holding on to longs like AAPL, BA, WDC POT, ISRG, WFM, CMG, WCN etc. I will look to buy some SPY down around the 114 area for a bounce should wee get there and Short around the 122 area.

Market Analysis for Week Starting Nov 21

What has changed since last week? SPY will start the week is in Oversold territory. We saw a lot of stocks bounces off profit areas, failed break outs and breakdowns from support. Generals like AMZN, CMG, and AAPL etc. are pulling back. Bonds are trying to break higher and the USD is holding up well. SPY broke short term uptrend, bounced off 200 MA and previous neckline. We formed another Chop area above a previous one which has earned a neutral rating overall long term.

Having said that, for the week ahead I am staying bullish with a tight stop below 120 area. Why? We are sitting above a previous Chop area which should act as support with a climbing 50 MA. The risk reward is perfect. If you’re going to jump out of a window it better be the basement window. Meaning if I am wrong the loss will be small.

Last week Shorts like CRM, SLV, DBA, AMED, ALK, CPA, performed well. Longs in COG & WCN Stopped me out while the rest of the longs are even or down slightly. Took some profits in ALK & closed out these positions in OIL (before pulling back hard) & CRM for nice healthy gains.

Heading into next week I have 40% of my portfolio deployed with a net long bias.


Weekly Charts

DXY

McCellan Oscillator

26wk High/Low Ratio

EUR/USD

TLT  

 

BDI 

OIL 

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Stocks, Cash, Bonds. (Bull or Bear)

This Daily Chart is a 3 month look back of relative comparison between Cash, Bond, and Stocks.
When Stocks are above Cash and Bonds, it signals Risk Appetite is on and vice versa

This is one of the great tools I use to keep me invested in the markets or out on the side lines in cash or short.

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EUR/USD Starting Nov 14

Chop Central!! Last week we had a nice fake out. The Edges can be played with extreme caution!

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MecClellan Oscillator Starting Nov 14

MecClellan Oscillator ended the week in the Overbought area. Could see a pull back this week . Although this is a nice indicator remember that "the markets can stay irrational a lot longer than we can stay solvent!" Meaning just because we are overbought it does not mean the markets must pull back!

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