Sunday, October 31, 2010

Anatomy of a BAD Sloppy Trade

This is very common illustration of what is going on on the Web these days.

This particular " Day Trading Educator " shows an example of his entry skills and crearly it does NOT measure up to high standards or good trading.

Not going to mention the name of the site but it is odvious that the poor trading skills does NOT justify the subscription price.

And please, don't come back to tell me that his was not the final target, IT DOESN'T MATTER , it is still a BAD , SLOPPY ENTRY ! NO precision whatsoever.

This critique- evaluation is done in good faith for those that are new to the day trading phenomenon.

Sunday, October 31st Halloween Trade:
Breakout Entry : Long 1182.25

Tuesday , November 02 Update :

Long from 1182.25 on Sunday night : 
Target reached at 1196.25 , + 14 Pts profits = $ 700 per contract

Saturday, October 30, 2010

Holloween Friday - GDP Report Day 10-29

GDP came in at consensus and, while the number will likely be revised downward in subsequent months, bulls have seized the opportunity to rally off the overnight lows near 1172. 

Continuing Thursday's seasonality discussion, Bespoke Investment Group released a study yesterday that filled in the missing hole for mid-term election day Tuesday, finding bullish seasonality for the day. 

With the first-of-November on Monday and FOMC on Wednesday, there is a solid block of bullish seasonality from Monday through Wednesday afternoon. 

While on alert for a risk selloff on diminished QE expectations, the sell-the-news moment may be after the announcement itself.  Some have noted deteriorating market internals.  This does make the markets susceptible to a selloff; however, these conditions can be reversed with a trend day up, especially one with a breakaway gap, which I would look for possibly on Monday. Note that a break in the ES below critical 1164-67 support makes new highs in the coming week unlikely.

Friday, October 29, 2010

America’s Jobs Losses

America’s Jobs Losses are Permanent

The claim that jobs offshoring by US corporations increases domestic employment in the US is one of the greatest hoaxes ever perpetrated. As was demonstrated in a syndicated column and again in this book, How The Economy Was Lost (2010).

 Mr. Slaughter reached his erroneous conclusion by counting the growth in multinational jobs in the U.S. without adjusting the data to reflect the acquisition of existing firms by multinationals and for existing firms turning themselves into multinationals by establishing foreign operations for the first time.

There was no new multinational employment in the U.S. Existing employment simply moved into the multinational category from a change in the status of firms to multinational

If Mr. Slaughter (or Cohen) had consulted the Bureau of Labor Statistics nonfarm payroll jobs data, he would have been unable to locate the 5.5 million jobs that were allegedly created. It was reported for about a decade the details of new jobs creation in the U.S. as revealed by the BLS data, as has Washington economist Charles McMillion. Over the last decade, the net new jobs created in the U.S. have nothing to do with multinational corporations. The jobs consist of low paying, no benefits , temporary , waitresses and bartenders, health care and social services (largely ambulatory health care), retail clerks, and while the bubble lasted, construction.

These are not the high-tech, high-paying jobs that the “New Economy” promised, and they are not jobs that can be associated with global corporations. Moreover, these domestic service jobs are themselves scarce !

But facts have nothing to do with it. Did Mr Slaughter, Cohen, the Chamber, and the Wall Street Journal ever wonder how it was possible to have simultaneously millions of new good-paying middle class jobs and virtually the worst income inequality in the developed world with all income gains accruing to the mega-rich?

In mid-October Treasury Secretary and Goldman Sachs puppet Tim Geithner gave a speech in California in the backyard, or former backyard, of 60 Minutes’ Silicon Valley dispossessed upper middle class interviewees in which Geithner said that the solution is to “educate more engineers.”

We already have more engineers than we have jobs for them. In a recent poll a Philadelphia marketing and research firm, Twentysomething, found that 85% of recent college graduates planned to move back home with parents. Even if members of the “boomeranger generation” find jobs, the jobs don’t pay enough to support an independent existence.In 2002 in the city of Melbourne, Florida, the well known High tech JDSU Corp. used to employed many fiber optics communications Enginneers that were suddenly laid-off due to the company closing and opening up in Beijing, Communist China.

The financial media ( CNBC ) is useless. Reporters repeat the lie for the benefit of their republican viewers that the unemployment rate is 9.6%. This is a specially concocted unemployment rate that does not count most of the unemployed. The government’s own more inclusive rate stands at 17%. Statistician John Williams, who counts unemployment the way it is supposed to be counted, finds the unemployment rate to be 22%

The financial press turns bad news into good news. Recently a monthly gain of 64,000 new private sector jobs was hyped, jobs that were more than offset by the loss in government jobs. Moreover, it takes around 150,000 new jobs each month to keep pace with labor force growth. In other words, 100,000 new jobs each month would be a 50,000 jobs deficit.

The idiocy of the financial press is demonstrated by the following two headlines which appeared on October 19 : “Dollar Index Appreciates as Geithner Supports Currency Strength” , “Geithner Weak Dollar Seen as U.S. Recovery Route”

To keep eyes off of the loss of jobs to offshoring, policymakers and their minions in the financial press blame US unemployment on alleged currency manipulation by Communist China and on the financial crisis. The financial crisis itself is blamed by ignorant Republicans on low income Americans who took out mortgages that they could not afford.

In other words, the problem is Communist China and the greedy American poor who tried to live above their means. With this being the American mindset, you can see why nothing can be done to save the economy

No government will admit its mistakes, especially when it can blame foreigners. Communist China is being made the scapegoat for American failure. An entire industry has grown up that points its finger at Communist China and away from 20 years of corporate offshoring of US jobs and 9 years of expensive and pointless US wars to protect Israel,s interests.

“Currency manipulation” is the charge. However, the purpose of the Communist Chinese peg to the US dollar is not currency manipulation. When the Communist Chinese government decided to take its broken communist economy into a market economy, the government understood that it needed foreign confidence in its currency, while keeping the communist ideology and government control of free speech and other basic freedoms. It achieved that by pegging its currency to the dollar, signaling that Communist China’s money was as sound as the US dollar. At that time, Communist China, of course, could not credibly give its currency a higher dollar value.The US foreign policies double standards allow the Communist Chinese to get away with manipulating their currency.They are not less communist than North Korea or Cuba, yet the US ignores the lack of democracy and human rights in Communist China

As time has passed, the irresponsible and foolish policies of the US have eroded the dollar’s value, and as the Communist Chinese currency is pegged to the dollar, its value has moved down with the dollar. The Communist Chinese have not manipulated the peg in order to make their currency less valuable.Althoug it is possible coming from those communist pigs.

During 2006,while working undercover in Communist China, the exchange rate was a little more than 8 yuan to the dollar. Today it is 6.6 yuan to the dollar–a 17.5% revaluation of the yuan.

The US government blames the US trade deficit with Communist China on an undervalued Chinese currency. However, the Chinese currency has risen 17.5% against the dollar since 2006, but the US trade deficit with Communist China has not declined.

The major cause of the US trade deficit with Communist China is “globalism” or the practice, enforced by Wall Street and Wal-Mart, of US corporations offshoring their production for US markets to Communist China in order to improve the bottom line by lowering labor costs. Most of the tariffs that the congressional idiots want to put on “Chinese” imports would, therefore, fall on the offshored production of US corporations. When these American brand goods, such as Apple computers, are brought to US markets, they enter the US as imports. Thus, the tariffs will be applied to US corporate offshored output as well as to the exports of Chinese companies to the US.

The correct conclusion is that the US trade deficit with Communist China is the result of “globalism” or jobs offshoring, not Chinese currency manipulation.

An important point always overlooked is that the US is dependent on Communist China for many manufactured products including high technology products that are no longer produced in the US. Revaluation of the Chinese currency would raise the dollar price of these products in the US. The greater the revaluation, the greater the price rise. The impact on already declining US living standards would be dramatic.

When US policymakers argue that the solution to America’s problems is a stronger Chinese currency, they are yet again putting the burden of adjustment on the out-of-work, indebted, and foreclosed American population.
The United States lost six million jobs, indebted itself to Communist China by $ 1.4 Trillion, and received in return a host of consumer goods, many of which are toxic and very poor quality and now reside in landfills across the country.

Thursday, October 28, 2010

Day Before GDP Report - Thursday 10-28

The bears looked like they were gaining the upper hand early yesterday; however, the bulls staged a late afternoon reversal and continued pushing overnight, such that the ES is testing critical resistance.  As key Institutional Level is just above at 1188.50, it would take a close above to target much higher. The potential for another leg up exists if this area is breached, so shorts need to defend it early.

 However, with the big US election next week and an FOMC meeting that will likely determine market action over the next six months, rumors are driving the markets and institutions are hedging.  Such an environment favors whipsaw and mean reversion rather than trend following. 

For what it’s worth, seasonality is still slightly bearish with Treasury supply today, but ends with the 7 Year auction at 1:00 pm.  The first month of November (Monday) has strongly bullish seasonality, as does the Tuesday close into Wednesday’s FOMC announcement at 2:15 pm.  Also keep in mind that preliminary GDP estimates (such as tomorrow’s at 8:30 am) are usually overly optimistic, being revised in subsequent months. 

Putting it all together, the shorts still have their window of opportunity to start a down leg, but a defense of 1188.50 and close below yesterday’s settlement of 1178.75 keeps them alive.There is a strong possibility that today's low will be tested during after close Globex Session.

Wednesday, October 27, 2010

Durable Goods Report Day-Review

The selloff overnight in the ES was initially sparked by disinflationary news out of Australia, lessening the chances for another rate hike. The dollar broked out above the previous high. However, there is another largely unnoticed story that deserves attention.  The current rally that began September 1 has largely been based on liquidity expectations vis-a-vis the Fed’s much vaunted QE2 program expected to be announced next Wednesday.  Expectations have likely become overdone, however, and overnight, the WSJ confirmed that the Fed’s plan will likely come in on the low end of estimates–around $500 billion.  Accordingly, there is a sell-the-news risk between now and next Wednesday.

The S&P 500  paired earlier losses and closed down 0.3 per cent after dropping more than 1 per cent earlier in the session.

Marginally supportive third-quarter results struggled to counteract the negative influence of a strengthening buck, but as the dollar’s rise faltered slightly, shares pared their losses.

A weak underlying reading for September US durable goods orders further weighed on sentiment, and better-than-expected new homes sales for last month provided little support.

The dollar’s new-found rigidity may be the result of short-covering as those who have been selling the currency take profits. But it may also reflect a reduction in the amount of quantitative easing that is expected to be revealed by the Fed in a week’s time

The Wall Street Journal said the Fed’s QE2 would see about $200bn of Treasury purchases, spread over several months, much less than the $500bn to $1,000bn Wall Street was hoping for.

This is important because many investors believed it was the promise of QE2 that was the main reason for the dollar’s stumble and the S&P 500’s concomitant 13 per cent advance since the start of September

Traders may also have been getting more wary about the political fallout from the Fed’s mooted move. Cheap money from the US was being increasingly blamed by trade partners for distorting the global financial system.

The amount of dollars being issued by the US is “out of control” and this is leading to an “attack” of imported inflation, Communist China’s commerce minister was reported as saying on Tuesday

An International Energy Agency official told an oil conference in Singapore that QE2 may lead to a commodities price surge that “could derail [economic] recovery”.

US bulls may like it, but clearly not everyone is enamoured of the QE2. And is it possible that such comments could be influencing Mr Bernanke to go easy? Probably not, as he is under pressure from the Republicans to keep the money supply going.

Tuesday, October 26, 2010

Overnight Trade develops according to trade plan

Final Institutional Level at 1174.25 also happens to be a Volume Composite level ( Which I don't use, NOT reliable ) reached and filled for a total of
+ 45.50 Pts Profits on multiple contracts - HOME RUN !

To be continued after market close....

Now that the G20 bullshit summit is out of the way, traders will be hoping that the global session’s early reticence was not caused by caution ahead of the Federal Reserve’s meeting on monetary policy, at which the market expects the launch of fresh round of quantitative easing.

Hopes for QE2 have been weakening the dollar, which in turn has helped a move into riskier assets. The dollar’s recent stabilisation – its index has closed within 76.5 and 78.5 for the past 17 trading days – may be a sign that either investors are having doubts about the extent of QE2, or they feel it is now baked into the market.

But the Fed’s decision is not until next Wednesday, and if investors sit on their hands until, then it may make for several dull trading days.

Thankfully, there is plenty of macro- and microeconomic data for traders to get stuck into before then. Bulls will be hoping they will see an improvement in US economic numbers, culminating in Friday’s advance reading for third-quarter GDP

Saturday, October 23, 2010

Inside Day and NR9 on Low Volume-Friday

Monday, 10-25

SOLD 1188 ( Intraday ) posted on Twitter

Setup :
Failure to Penetrate Globex High 1193, making a Double Top
Dollar Index Recovery after new Low
VIX Count
First Target :
Tuesday, 10-26 - 07.47am est

filled at 1179.25 for + 8.75 Pts

Five Hours of sideways low volume 3.25 pts sideways range.This is got to be a record in the history of the Day Session E-Mini S&P 500 Futures contract

Short Swing position is on. No need to worry, got enough winners behind me.

Sunday 10-24 Update:
Swing position Stop Loss filled. Breakout Trade  (separate Day-Trading Account )
as described in Twitter was a winner for a combined Net Gain : + 9 Pts profits

Will get away from the markets this weekend.The ocean is calling for a weekend of Scuba Diving in the blue tropical oceans.

" And the seas will grant each man new hope "...

While listening to " You Only Live Twice " , longing for adventure...

Volume production on the major indexes was anemic today, particularly in the context of the recent heightened volume output. On the S&P 500, a mere 2.79 billion shares were traded.

US equity indexes traded on very low volume (a mere 770 million shares were traded on the NYSE, representing a one-month low) but on balance managed to drift higher, with the Nasdaq 100 up solidly and the S&P 500 up very modestly. Notably, intraday ranges were very narrow today (e.g., the S&P 500 traded within a 3-point range for several hours today), with market observers suggesting traders are waiting for a catalyst to drive the market either higher, or into a pullback. As noted above, the major indexes are now up on seven of the last eight weeks, and the broad market has risen some 11% over the past two months.

US market participants may be waiting to see what results emerge from a G-20 meeting of finance ministers and central banks to be held in Korea. Trade policy and currency manipulation will be key topics, for instance 'currency wars', where countries worldwide are currently attempting to depress their own currencies in an attempt to boost exports.

In key earnings releases, Baidu and Amazon both surged to record highs today following better-than-expected earnings. As well, American Express, Honeywell, Schlumberger, and Verizon also did well on the earnings scene. All in all, a third of S&P 500 companies have reported earnings thus far, and close to three quarters of these appear to have beaten analysts’ expectations.

 Looking at where the S&P is relative to its 55 DMA,  every time the market has gotten to above 5% its trailing average, it has always entered a period of consolidation ( at least modest selling). Furthermore, compared to the recent trend extreme of 7% above 55 DMA, the market moved meaningfully above one just one occasion in the past: in January 2009... just before the crash to the decade lows of 666 on the S&P occurred.

Notable Quotes :

The eye sees only what the mind is prepared to comprehend.

Henri Bergson
(French Philosopher, 1927 Nobel Prize in Literature, 1859-1941

Friday, October 22, 2010

Market Outlook

I believe that the broad market’s short-term prospects for further and sustainable gains are fairly limited. I would expect to see flat to modestly lower levels on the major indexes over the short-term. Looking to sell tomorrow on a low risk entry.

A volatile session saw the broad market advance by as much as one percent, then retreat, then advance again modestly, thus closing green. Intraday, equities reached a new five-month high. Market observers suggest that early gains were catalyzed by a weaker US dollar but later gains did not stick due to an advance in the dollar.

More earnings were released today, but the recent wave of better-than-expected results did not appear to be exciting investors as much as in recent days. Notably today, Dow component Caterpillar reported better-than-expected earnings, but the stock was sold down. Eli Lilly and UPS also reported strong earnings but also sold off on the news. Gaining on their earnings releases were eBay and McDonald's – but even these stocks closed near their session lows today.

The US government reported the latest jobless claims data today, showing a decline of 23,000 claims week-over-week to a total of 452,000 claims (consensus estimate: 455,000 initial claims).

Meanwhile, the Philadelphia Fed Index hit a level of 1.0 in October (consensus estimate: a reading of 1.5). Finally, September Leading Indicators were up 0.3%, matching consensus estimates.

Some market observers are warning that investors may once again be becoming too complacent and fearless, often a warning sign for equities, although such sentiment readings by themselves are not good market timing tools (as such conditions can prevail for some time before the market shows an adverse reaction). Case in point, the most recent survey by the American Association of Individual Investors shows the degree of bullishness at a reading of 49.6% and bearishness at a mere 25.2%. At the April 2010 top for equities, these readings were 48.5% bullish and 29.7% bearish. Likewise, the VIX Index (also known as the market’s fear gauge) is currently also indicating low fear levels coupled with high investor complacency.

Tuesday, October 19, 2010

Swing Trades Update

The BULL is in its last leg, ready to FALL.

New Swing Position initiated on the last hour of the Monday Day Session :

 SOLD 1180.25 on a Bearish Engulfing Signal ( 5min ) failure to penetrate 1182. STOP Loss : 1181.25 , moved to 1178
Open profits now : + 8.75 pts per contract.

Tuesday, October 19 Update :

Open profits now : + 22.50 pts   HOME RUN !

Those followers that read the Clue Statement posted on this Blog on Sunday 10-17 knew what was going to happen today Monday.That is exactly what happened


TTT Sell Short day
 MACD Bearish Divergence
 Day after Options Expiration
 Important Market Turning Date
 RSI ( 2 ) Reading :  97
Other : Dollar Index

A solid rise in bank stocks - which were recently beaten down over accusations that foreclosure issues had been handled poorly - catalyzed a modest advance on the broad market (on unimpressive volume of less than one billion shares on the NYSE).

As well, Citigroup posted better -than-expected earnings although revenue came in light. Still, Citigroup stock put in its best single-session percentage gain since April. According to Citigroup, fewer of its customers defaulted on loans, bringing a potential improvement of the bank's balance sheet. Citigroup's strength boosted the KBW Bank Index by three percent (last week, it lost 4.5%). Overall, the financial sector outperformed other S&P 500 sectors, rising 2.3% today.
In economic data, September industrial production was down 0.2% while capacity utilization came in just under 75%. Meanwhile, homebuilders remain pessimistic about the US housing market, s indicated by the National Association of Home Builders' monthly index rising only slightly to a reading of 16. While this is the index's first increase in five months, the index is well below 50, which is the dividing line between positive and negative sentiment. We have to go back to April 2006 to see the last reading above 50

In notable earnings news, IBM, whose stock has been rising relentlessly since early September, reported a 12% rise in net income and raised its profit forecast for the rest of this year. Wall Street tech darling Apple, now the second-most profitable US technology company (after Microsoft) took a hit in after-hours trading today, declining some six percent in spite of strong earnings. Both Apple and IBM thus experienced a sell-the-news reaction to their earnings reports; some market observers feel these two stocks have been 'priced for perfection'; others see the (rare) pullback as buying opportunities.

Sunday, October 17, 2010

Opt.Exp Friday Price Action Review

A number of earnings high-profile reports, a speech by Fed Chairman Bernanke, and some economic data all conspired to drive the Nasdaq 100 significantly higher, the S&P 500 slightly up, but the Dow down today. Volume was heavy, likely mostly attributable to today's options expiration session ' some 1.4 billion shares exchanged hands on the NYSE. Bernanke suggested this morning that quantitative easing is likely. Interestingly, the US dollar failed to decline on this news and closed the day up 0.6% instead.

Google shares surged today after last night's strong earnings surprise. Google stock saw its strongest single-session gain in over a year and settled at a nine-month high. Given that Google represents 4% of the Nasdaq Composite's market weight, today's outperformance of the tech sector is not surprising. Seagate Technology also contributed to the Nasdaq's strength today as the company announced it is interested in going private.

In contrast to the tech sector's upswing, both the Dow and the financial sector failed to participate in the broad market rally today. The financial sector was off close to two percent and the KBW Bank Index even decline by 2.4%. Banks have been underperforming lately and this has some market observers worried about the broad market's prospects. The Dow lost some ground today after strong selling was seen on General Electric with investors disappointed about the company's modest revenues. GE stock saw its worst single-session slide in roughly five months.

A slew of economic data was released today: September retail sales were up 0.6% (consensus estimate: a rise of 0.4%), Excluding auto sales, retail sales were up 0.4%. In September, consumer prices rose 0.1% whereas core prices remained unchanged month-over-month (consensus estimate: a rise of 0.2% overall and an increase of 0.1% monthly in core prices). An improvement was seen on the New York Empire Manufacturing Index for October (this month's reading: 15.73; September's value: 4.10; consensus estimate for October: 5.75). The University of Michigan reported its preliminary Consumer Sentiment reading for October; it came in at 67.9 (prior month's value: 68.2; consensus estimate for October: 68.5). Finally, August business inventories were up 0.6% (consensus estimate: a rise of 0.5%).

Monday is a High probability important market turning day

Globex Sunday October 17 6:57pm est : SOLD 1173.25

Monday October 18 - 04:10am Globex Session :
Target filled at Institutional Level 1165 for + 6.25 pts profits ( emailed to subscribers )

Thursday, October 14, 2010

Another Low Risk Trade Executed from Wed 1 0-13

Results of Swing trade : SHORT from 1180.25 Wed Oct. 13. Profits + 13.75 pts ,
on two units = + 27.50 pts gain or $ 1,375

The market retraced back up to retest 1181
Globex high today was 1080.75

My decision to maintain the original target was never in doubt due to several compelling reasons.

 Trading Plan Execution

Before entering any trade a professional trader will plan out the trade, including their entry, stop and targets. Long term profitability and success comes from being able to flawlessly execute your trading plan even in the face of adversity. A professional trader has absolute belief and conviction in their trading ability and therefore will never allow themselves to second guess their trading plan's logic mid way through a trade.

Wednesday, October 13, 2010

Swing Position Initiated

As posted in Twitter the New Swing position was executed today in the E-Mini S&P Futures ESZ10
December Contract.

Exclusive Subscribers received the entry notice one hour before. The stop loss was only one point for the second Entry.

Entry SETUP/Analysis available upon request.

SHORT : 1180.25 Target : To be Determined based on market action.

Volume output on the S&P 500 was up sharply from yesterday's anemic levels - some 3.6 billion shares were traded on the index today.

After a poor start, US equities rose to flat (the Dow) to positive closes following the release of the Fed meeting notes. The underlying tone was that the minutes from the Federal Reserve's September 21 meeting would keep investors' hopes alive that the central bank would follow through with another round of quantitative easing ('QE2'), as discussed here a number of times. The Fed's next meeting is scheduled for early November.

The Fed minutes suggest that Fed members are concerned not that inflation is too high - as often feared - but in the current economic climate that it might actually be too low. The minutes seem to suggest that the Fed will take action to stimulate the US economy 'before long.' Specifically, the minutes indicated a majority of FOMC members are indeed willing to 'provide additional monetary policy accommodation'; however, the door was left open, as the Fed also included the following qualifying statement: '... saw merit in accumulating further information before reaching a decision about providing additional monetary stimulus.'.

Technology issues outperformed today, with Intel rising ahead of its earnings release after the bell today (here the company beat analyst estimates regarding earnings per share and total revenue for Q3); Apple rose to almost $300 per share after the company announced that Wal-Mart will start selling its new flagship product, the iPad. Q3 earnings season will kick into high gear this week.

In M&A activity, Pfizer announced it would acquire drugmaker King Pharmaceuticals for $3.6 billion in cash.

Monday, October 11, 2010

Memorial Day -Low Volume Trade - Wins

Trading Method works even on Low Volume Days
Timing is everything and reading the other markets clues is also important.

Swing Trading Portfolio:

SOLD 1164
Setup :
Dollar Index : Breakout of Prev High
MACD Bearish Divergence
RSI (2 ) : 93 close of Friday
Open profits : + 7.5 pts per contract

Target filled at 1152 during Globex O/N for + 12 pts profits per contract

Sunday, October 10, 2010

NFPayrolls Report Day -Friday - Review

As expected the US market rallied with pivotal jobs report even when it indicated further weakness in the US labor market, as this was perceived by the market as sending a strong signal to the Fed to prompt it for more quantitative easing ('QE2'). The US government's jobs report was indeed the main event today, and it delivered very ugly numbers:

Some 95,000 jobs were lost last month (predominantly due to the US governments laying off workers, notably temporary census employees), wage growth was stagnant, and the so-called 'U-6' unemployment number (also called the 'real unemployment' number) trended further to the upside. Specifically, September nonfarm payrolls were off by 95,000 (consensus estimate: no net change) while private payrolls showed an increase of 64,000 (consensus estimate: an increase of 74,000 private , mostly Low paying / NO Benefits temporary payrolls ). Meanwhile, unemployment remained unchanged at 9.6%. Remember 
Wall Street does not really care about the unemployed, only about taxes for the wealthy and what the Banksters will do in the future.

The broad market rose on this news (although on poor volume) as participants expect that this dismal showing from the labor market would certainly tip the scale in favor of QE2, an opinion also voiced by many market observers. 'Quantitative easing' has thus become the newest and strongest current buzzword on Wall Street. QE2 is supposed to lower the already low interest rates even further, which should reduce businesses' capital costs ( a form of lower taxation ) and stimulate lending and borrowing across the economy.What they don't tell you is that most of the manufacturers, will close in the US and open in Communist China like they have been doing for the past 30 years.

Equities rallied as the US dollar continued its slide; in turn, gold and agricultural commodities resumed their strong uptrends, with the CRB Commodity Index coming in at almost a two-year high. Meanwhile, market volatility (as measured by the VIX) was down to its lowest level in five months, suggesting market participants believe market risks will remain low and equities could remain buoyant in spite of - or, as noted, because 0f- the poor economic situation.Pump the money supply FED to the resque !Lower the taxes for the rich, even though they're not going to spend it !, very smart indeed.

The same game gets played again ahead of another long holiday weekend.The U.S Dollar Index drops and the stock market rejoices over losing 91,000 jobs in September. It is all about the U.S. Dollar and the FED ,as the dollar continues to decline on a daily basis. When the dollar declines the markets inflates and trades higher. When you see that most commodities and assets are denominated in the U.S. Dollar, what have you really gained from this rally? Most retirees and people that are fed up with the stock market games have lost 12.0 percent of their purchasing power in the dollar. So once again this economy will suffer at the hands of the inflation creators ( Republicans obssesed with lower taxes ).
Quote of the Day :   " We are putting back in Congress the people ( Republicans ) that screwed it up in the first place ! "  Mark Haines, CNBC

Thursday, October 7, 2010

Day Before the N.F. Payrolls Report - Review

Main Events Recap during this week :

The main impetus for Tuesday's rally was a volatile combination of free money from the FED and other central bank interventions in the market.

The Japanese central bank (BOJ) intervened again in the Forex markets to buy US dollars and sell the Yen. It didn't work longer than a few hours and then the US dollar tanked, which was cheered on Wall Street.

Yes, the Banksters on Fraud Street and at the FED want you to lose your purchasing power in favor of the their assets increasing.

Additionally, the BOJ said that it will expand its asset purchases to outright purchases of REITs, equities, corporate bonds, and land.

Fraud Street cheered this which led to immediate talk of the US Federal Reserve doing the same. Of course, this is happening in another way now...via POMO.

In more steps to give Banksters money to jack up the market, the FED was buying Treasuries from the Banksters via its POMO operations, which led to massive equity purchases. When the POMO buying spree ended Tuesday, the majority of the rally ended with it. After a 90-min lull in the market, the S&P was only able to extend its gains an additional 3.50 points. Don't underestimate the amount of money the Fed is  buying.  The Federal Reserve is now the second largest holder of US government debt. They are monetizing $11 Billion of bonds a week ! Without the FED manipulation, the market it's dead.
The non-Manufacturing ISM data was better than expected and certainly helped the rally, but by itself wasn't even close to offsetting the recent avalanche of bad economic data.

The FED was manipulating the market again Wednesday. As soon as the FED was done buying, the S&P sank to the lows of the day and never returned. Without the FED manipulating, the market it's dead

Ireland was downgraded again Wednesday.

Greece was audited and found to STILL be lying about its colossal debt. More problems from Europe are coming folks.
Food stamp welfare is at a new record. How cares as long as the rich are still spending.That is Wall Street attitude.
Unemployment remains at nearly 10%.
Wednesday's private payroll estimate was shockingly worse than expected.

The IMF slashed U.S. GDP growth rates.
QE2 by the FED is all but guaranteed and will increase the money supply by at least 50%, or $1 trillion. Some are calling for an additional $7 trillion of asset purchases, which should make the banksters quite happy indeed. You? Not so much. It may be a nightmare.

Sarah Palin still thinks she can be President even if she odviously can't deliver a smart speech about anything.

Wed-October-06-ADP Report Day Review

Breakout Trade :

Long 1157.50
Setup : Daily NR45 , Bullish reaction to BOE rate decision during Globex
First Target filled at 1060.50 for + 3 pts profit per contract. Second Target never reached. Out FLAT
at 1060 for another + 2.5 pts.
Total GAIN : + 5.5 Pts per contract

For the short-term, I see a good potential for further consolidation with some emerging downside pressure.

Today brought something for everyone: the Dow advanced, the S&P 500 held steady, but the Nasdaq 100 declined. The Dow is now at its highest closing level since early May of this year.

Today's volume output on the S&P 500 was comparatively elevated, though lower than yesterday's strong volume - 3.42 billion shares were traded. There was a lack of demand, as can be determined by the decrease in volume activity, but in the absence of demand, sellers did not step in to take advantage of the buying void and push price lower.

The Fed keeps feeding money into the corrupt banking system ( Permanent Open Market Operations ), and the banks buy options to support the market. After all, elections are coming up, and the corporate federal government will do all it can to save face for Republicans against the embarrassment of a declining stock market.

The market traded mixed today with only the Dow making further upside progress. One reason for the flat overall performance was seen in lackluster economic data pertaining to the US labor market (discussed below). Intraday, the Dow extended its run to a five-month high, but higher levels were rejected on the S&P 500 as well as on the Nasdaq 100 (which thus showed non-confirmation).

Today saw the release of the ADP payrolls report which typically precedes the government's official 'jobs report' by a few days. Based on the ADP report, some market commentators estimate that this Friday's jobs report could show a modest growth in new jobs. ADP data pertains to private jobs and today's data shows that private employers cut 39,000 jobs in September (consensus estimate: a growth of 18,000 jobs), the first loss in seven months. Today's downside surprise acted as a damper on investor enthusiasm in spite of the fact that data for the prior month was revised upward, suggesting an extra 10,000 payrolls. Market observers suggest a poor jobs report on Friday might further increase the odds the Fed will have to step up its efforts in trying to stimulate the US economy.

In earnings reports (the Q3 earnings season will officially start tomorrow with Alcoa's release), Monsanto fell short of expectations and issued downside guidance.

In the Treasuries market, yields on notes with maturities of 2-, 3-, 5-, as well as 7 years all set record lows today. Treasury yields have been making new lows as investors anticipate there could be further easing (i.e., bond purchases) from the Fed. The US dollar suffered yet another loss against a basket of currencies, losing another 0.5% today and making an eight-month low. Gold meanwhile ran to yet another new all-time high.

In M&A news, Dow component Johnson & Johnson will buy Dutch biotechnology company Crucell NV for roughly $2.4 billion.

Tuesday, October 5, 2010

Banks vs We the People....

This weekend, Bank of America became the latest lender to delay all foreclosures in 23 states because of possible problems with the necessary documents needed to repossess a home.  GMAC Mortgage and JP Morgan Chase have had similar problems recently with documents that prove the bank has the right to foreclose. posted a statement from B of A, “We have been assessing our existing processes. To be certain affidavits have followed the correct procedures, Bank of America will delay the process in order to amend all affidavits in foreclosure cases that have not yet gone to judgment in the 23 states where courts have jurisdiction over foreclosures,” BofA spokesman Dan Frahm said in a statement.”

Florida Congressman Alan Grayson says the foreclosure document “problem” is really fraud on a massive scale.  He calls what is happening now a “foreclosure fraud crisis” that could affect 60 million properties in the U.S.  It is all because the banks have lost track of promissory notes signed by the homeowners.  (Click here for the 2008 “Produce the Note” story from CNN.)    Back then, some big banks could not “produce the note” that proved it had the right to take back a home ( basic Real Estate Law , IDIOTS !).The problem has gotten much bigger as more homeowners discover the banks do not have the original documents

After physical paperwork was filled out and signed by the borrower, the banks electronically filed the paperwork into a computerized system called the “Mortgage Electronic Registry System” (MERS).   According to Congressman Grayson, 60%, or 60 million, mortgages are in MERS.  The banks lost track of the original paperwork, the note, signed by the borrower.  That is what actually proves the bank owns the property.  Grayson says, “It appears that on a widespread and probably pervasive basis they (the banks) did not take the steps necessary to own the note . . . which means that in 45 out of the 50 states they lack the legal right to foreclose. . . .  So they have simply created a system where servicers hire foreclosure mill law firms ( most of them republican voters ) whose business is to forge documents showing or purporting to show they have a legal right to foreclose.”  

Please take a moment and grasp the enormity of this problem for the banks.  There are 60 million homes which banks loaned money on, and now they might not be able to legally get the property back if the homeowner defaults!  Another colossal problem for the banks is the trillions of dollars in mortgages bundled into securities.  Remember, the banks were giving anyone who could fog a mirror a mortgage which allowed them to create and sell lucrative mortgage backed securities.  So, there are trillions of dollars in mortgage backed securities that now could have NO backing!   Would you like to be the pension fund manager who bought that security?  Do you think this just might cause an accounting problem for the banks?  Do you think this could push some of the big banks into bankruptcy?  Will there be another financial meltdown and government rescue?

Monday, October 4, 2010

Swing Trade from last Thursday-Update

SHORT from 1145.75.
Open profits now + 34.50 pts per contract
 Daily Analysis scenario worked as expected.

Target : Daily  20 EMA

Will monitor during Globex session after the close

My exclusive loyal subscribers must be very happy.

Stay tune.

Tuesday, October 5th

Globex session price action did not follow through to the intended target and exit stop was filled at 1131.50 for a gain of + 14.25 pts per contract. Swing position is now FLAT.

Sunday, October 3, 2010

Friday - Inside Day - October 1 st

Q4 trading started cautiously with the Dow and the S&P 500 showing small gains while the Nasdaq 100 failed to advance. Equities saw their highs early on but then slid on the heel of a slew of economic data releases (discussed below). Afternoon upside was light, but sufficient to bring green closes to some of the indexes.

Among the economic data released today were August income and spending numbers. These came in solidly, with personal income up 0.5% (consensus estimate: a rise of only 0.3%), representing the best monthly increase in personal incomes in 2010. Personal spending was also up, rising 0.4% (consensus estimate: a 0.3% increase). Core personal consumption expenditures were also on the increase, up 0.1%, meeting consensus estimates.

The University of Michigan reported its final September consumer sentiment reading today. Consumer confidence improved from 66.6 to 68.2 (consensus estimate: a reading of 67.0). The latest reading on construction spending was also positive, up 0.4% in August (prior month's reading: a decline of 1.4%; consensus estimate: a 0.5% decrease). Proving to be disappointing on the other hand were the latest ISM Manufacturing readings for September. The ISM index lost some ground month-over-month, sliding to 54.4 from a prior reading of 56.3 (consensus estimate: a reading of 54.8).
The US SEC and the US Commodity Futures Trading Commission jointly released their findings on the causes of the ominous 'flash crash' from early May today. A 100+ page paper was compiled on the issue. The document entitled 'FINDINGS REGARDING THE MARKET EVENTS OF MAY 6, 2010 - REPORT OF THE STAFFS OF THE CFTC AND SEC TO THE JOINT ADVISORY COMMITTEE ON EMERGING REGULATORY ISSUES' can be downloaded from the SEC website.