Friday, August 28, 2009

IMPASSE

Fed has exhausted their reinflation play on the market.......the dollar sits on resistance of 77-78. If they don't bring the dollar off of this area ......its over. So I suspect that the market will begin to turn down over the next couple of weeks.......between now and then choppy action just like the last week. It is just a slaughter for day traders right now as the algo programs just move like the cold-blooded killers they are without conscience like sharks... feeding on the remains of traders frozen in their tracks. As many of you that are experienced traders can now admit this is a complete abomination. On the other hand if you believe in the tooth fairy then trading this POS is fairly easy.......ignore T/A and fundamentals and your gut and go LONG. The bulls will be slaughtered soon but beware bears this is not gonna be the long awaited P3. gl gang

16 comments:

  1. kli, what about ung here

    finishing up an ed

    wheres immred, he follows ung

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  2. UNG is in a basing pattern but it made me cough up 55% of my position today.....dunno .....I will take my toys and watch for the slaughter of the miners....my guess is we are getting close to a seasonal bottom and the GS boyz are gonna squeeze the shorts to hell in UNG......and gas but ....

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  3. UNG? Just follows the natural gas at a premium these days after being turned into a closed fund. Looks like a forced firesale on the physical side.

    We could still be in the final capitulation phase or we could go much lower than 10.55 as everybody still left standing is wiped out from the long side before they allow it back up.

    The next crack at the 100 dma will be sub 13.50 for UNG don't know how meaningful that number is with the premiums and swaps built into the shares. Hourly techs look like either on the verge of another breakdown before a minor breakout.

    If you want to play UNG your time horizon better be longer than a few days.

    The risk of staying long is increasing, same goes for holding shorts at the tail end of a potential parabolic blowout. If your time horizon is a few days or less then stay in cash and forget about the markets.

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  4. One of the problems is that the E&Ps keep shutting wells, but due to the increased output rates from each one, overall nat gas production is not falling much. Plus, there is a fracking law coming into play that's causing some activity in drilling prior to it becoming more difficult/costly. Combined with the seasonal low and more shale gas in the ground than they know what to do with.

    At the same time, the downside here looks tolerable with nat gas at $2.80. Personally, I may enter a small position if it goes a little lower. Seems like a good risk/reward longer-term, no?

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  5. kli,

    Those who do not watch and develop bias in one side would be taken to cleaners:

    http://messages.finance.yahoo.com/Stocks_%28A_to_Z%29/Stocks_U/threadview?m=tm&bn=58157&tid=511477&mid=511477&tof=1&frt=2

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  6. hey Kli,...others.

    again this is getting dicey.

    Can any kind of sell off in the market come to be?

    A sell off would pop the propoganda bubble and cause mass social problems. People on the fence will give up paying their bills. Is the fed and co-conspiritors could enough to just massage the market up and down to keep all of the parts moving...interest rates low'ish, oil cheap, yields sellable, homeless hidden...seems impossible.

    To me it seems any kind of sell of would/should become..shall we say disorderly...the market should just sell, gap down be weak close low..hesitate at supports.

    however, it seems like any sell off is going to blow the mind because it will be stopped, bid up, manipulated..this will be hard. we will hear the bottom is in again and again.

    I fought the tape all the way from 3/9 thinking no way the "bottom" could be in. The best thing of course at the time was to buy and hold it. I had some really great fas/uyg postions i got shook from.

    this should be interesting.


    da Blacksheep

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  7. Blacksheep,

    Here is your answer:
    http://messages.finance.yahoo.com/Stocks_%28A_to_Z%29/Stocks_U/threadview?m=tm&bn=58157&tid=511477&mid=511477&tof=1&frt=2

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  8. excellent pull anon and I agree with mizes post.....he is correct blacky

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  9. blacky btw the selloff may appear to be disorderly but once the disorderly sentiment starts to roll it will be stopped cold with the famous reversal day.....joe thinks it could be several weeks in duration....and he is licking his chops

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  10. Morla The Ancient OneAugust 28, 2009 at 8:37 PM

    I have an interesting theory, the fed is supposedly required to release info on some corps that they gave big loans to. Aug 31 is the date but there's a chance they can stall for more time.. But what if they don't really want more time?

    Is it possible the Fed will disclose it "against their will" and when P3 starts they can lay the blame on courts trying to cramp their secrecy?

    The fed has said that obeying the decision would be a disaster, similar lingo to the bailout ram-through they did last year. If P3 really is close they could release the info and show us that the sky really WILL fall when they say it will.

    Not only would such a situation strengthen their pro-secrecy stance going forward it would make the need for past mystery-bailouts more believable. The Fed could watch the market go up in flames and put a feather in their cap at the same time.

    Just an idea though..

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  11. Morla your guess is as good as mine .....my "guess" is that GS is in charge of the market .....and they know as well as anyone that we have to have a dump.....their goal is to control the unwinding of the market to suit essentially themselves ....their is an uneasy alliance they have with the current administration......notice I did not say fed....the fed and GS are the same....so...here is the rub...if GS didn't have Obama alliance right now they might manipulate the market a little differently....some caveats might be a harder run up in oil/gas ....but right now they seem to have complete control....so I would probably defer the answer to any of the GS observers out there and they are there......

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  12. GS is one of the firms with a room full of quants that control things, but the "runners" are a front for the best of breed, there are really 12 top quants worldwide that have the system under governance, each working for the top institutions. DB is another player, their quant is assigned to the EU. They work in tandem to align global markets and manipulate currencies. These people are the best, recruited from very young as soon as their potential is realized. Typical flags on early superior intelligence such as speech at extremely early ages, apptitude for learning multiple languages pre-teen, tendency toward dis-associative behavior toward peers (psychological profile), etc. In the past, these people were usually tracked once they hit people's radar and recruited into cryptography, now the top ones are targeted for this role. Each of these top people were selected out as protegies, The CFR controls it, with "R" family dictating the time series. Market top 10/14.

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  13. Kilguy

    Sometimes with all the details of gas,oil, gold, the dollar and the differnt markets one loses sight of the bIg picture. So are we witnessing some sort of economic battle between countries? Or are we witnessing more of a gaint coverup so that the powers that be can maintain all they have grown accustom too? If everything has to be manipulated to whose benefit and why? And what are they so scared of? I know it sounds naive but I could not resist asking.

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  14. pros and cons of an impending sell off.

    From Bob Chapman:

    In September we see a renewal of monetization where officially the Fed will buy more and more Treasuries, Agencies and CD’s from banks, besides what they are doing in secret. A large part of the budget deficit, real estate expansion and banks’ bad debt will be monetized by the Fed, which is very inflationary. This is what went on in Argentina and the Weimer Republic and this is where Ben is headed. This is why you have to have gold and silver related investments; they will be your only protection.

    The dollar may weaken through “established lows” as signs of a global economic recovery drive gains in equities and oil, Goldman Sachs Group Inc. said.

    “That kind of shift could easily be prompted by continued good news from the macro front and the persistently negative dollar-equity and dollar-oil correlations,” Thomas Stolper, an economist at Goldman Sachs in London, wrote in a report yesterday. “Dollar bulls could well end up disappointed. Even a short-term move beyond our three- and six-month forecasts of $1.45 per euro is getting increasingly likely.”

    The Dollar Index, which Intercontinental Exchange Inc. uses to track the U.S. currency against the euro, yen, pound, Canadian dollar, Swiss franc and the Swedish krona, has weakened as the Standard & Poor’s 500 Index of U.S. shares gained more than 85 percent of the time since June and more than 50 percent of the time since September as investors sought higher-yielding assets on signs on an economic recovery.

    The index fell 11 percent from its high this year on March 4, during which time the S&P 500 gained 44 percent. The index was little changed at 78.592 as of 7:29 a.m. in New York. S&P 500 Index futures were unchanged.

    “More and more foreign-exchange players have positioned themselves for a dollar bounce without much impact on the spot market,” Stolper said. Since early June, traders have moved toward favoring contracts that give them the option to buy the dollar against the pound, while “spot remains stuck in the mid- $1.60s,” Stolper said.

    The cost of betting that the dollar will rise against the pound in one month’s time are at the highest since July 14, and near the most since March, according to 25 Delta risk reversals.

    “All this suggests that the underlying dollar trend is still downward sloping and the risk is that normalization in positioning pushes the dollar through the established lows,” Stolper said.


    So:

    If the dollar bulls..are in the camp that a short term bounce is due...but liquidate the long position when this fails as QE starts again..which it will

    because:

    A federal deficit of 100% of GDP over the next decade, as deficits swell to more than $1 trillion a year.

    ...they have too. This leads us to a inflationary s an p. Until some exogenous event happens to chnge this course.

    This is out of control for Ben. Popping the housing bubble has created this new equity price bubble. Complete with stagflation. Every thing you own is worth less every you need will cost more.

    Un less the QE results in a liquidity trap and DEFLATION. to me seems plausible. Especially if the china story is not as stong as stated. Slack demand for commodities.



    da black sheep

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  15. There is no demand increase for any asset class. PPI is in a freefall and the QE has resulted in inflated stock and some commodities prices...not demand. Your liquidity trap is spot on IMO. We might not see real inflation for quite some time.

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  16. demand pull inflation is what confounds many in this debate.....and no we will not see that .......but stagflation is currently occurring and will imo continue until the washout predicted by Kress in 2012

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