Stock Incubator

[dalcindo]

Re: FIN's: XLF, FAS, IYF - Continued BEAR trend

The financials looked better at the apex of their combined MAX expansion, even at a time when RSI weakened.

Since then, XLF, FAS, IYF have struggled against the SPX, even when the SPX is declining ever so slowly (See chart below highlighting the relative strength of these FIN's expressed against SPX).

Overall, financial stocks are getting anemic, under-performing the PSX since NOV 2009, and this at a rate that makes SPX look more attractive, despite its own bearish stance since mid-January 2010:


Financial ETFs Relative Strength Against SPX:


- Dalcindo

[dalcindo]

Re: SPY and S&P 500's SML & MID - BEARISH


SPY faces significant resistance at upper border of bearish channel. Correspondingly, RSI weakens at that same level, where it fails to cross over its 60-level, suggesting heavy bearish pressure as this weeks concludes.

Regardless of the capitalization level of the S&P companies, this resistance appears to be endemic. For instance, notice how the WEEKLY charts of S&P 500's Small Caps ("$SML") and mid-caps ("$MID") below are heading towards same resistance.



SPY (S&P 500 SPDRs) - 36-Mo., Weekly Chart:



$SPX - $SML - 36-Mo., Weekly Chart:



$SPX - $MID - 36-Mo., WEEKLY Chart:


- Dalcindo

[dalcindo]

Re: V - Looking toppish:

Pre-decline pattern formed per overbought conditions within a set of secondary indicators:


V - 12-Month, Daily Chart:


- Dalcindo

[dalcindo]

Re: COIN - Weekly Chart: BULLISH

COIN is turning bullish, although there remains some much needed confirmation:

For one, price is expected to meet significant resistance at the dashed blue line.

For two, a minor hurdle awaits the expected rally at the bearish channel's midlines, a resistance area that may be minor and should occur prior to the more imposing "dashed blue" resistance line, IMHO.

Overall, indicators are turning positive following a shallow retracement, suggestive of bullish support all along recent technical developments.


COIN - 3-Year, Weekly Chart:


- Dalcindo

[dalcindo]

Article - Facing pressure, Bernanke to address lawmakers

Bernanke to face lawmakers seeking answers on economic rebound, timing of credit tightening

By Jeannine Aversa
AP Economics Writer
On Wednesday February 24, 2010, 12:04 am EST

(Source: http://finance.yahoo.com/news/Facing-pressure-Bernanke-to-apf-1254187709.html?x=0&.v=1 )


WASHINGTON (AP) -- Ben Bernanke goes to Capitol Hill on Wednesday carrying the weight of high expectations.

The Federal Reserve chairman helped pull the country out of the worst recession since the 1930s. Now, lawmakers want to know what he can, or will, do to ease the jobs crisis and make sure the economic recovery lasts. Many will be looking, too, for any clues about when the Fed might start to tighten credit.

Bernanke, who will deliver his twice-a-year economic report to Congress, will be under more pressure than usual. It's an election year for lawmakers, whose constituents face near-double-digit unemployment, record-high home foreclosures and tough-to-get credit, especially for small businesses.

As he was sworn in for a second term as Fed chief this month, Bernanke said Congress and the White House must do their part to provide relief.

"We at the Federal Reserve cannot hope to solve all these problems on our own," he said.

To nurture the recovery, Bernanke and his Fed colleagues have pledged to hold a key interest rate at a record low near zero for an "extended period." The idea is for low rates to encourage consumers and businesses to borrow and spend and keep the economy growing.

The unemployment rate, now at 9.7 percent, is expected to drop only slowly. Many economists think it will take until the middle of this decade for the jobless rate to decline to a more normal 5.5 percent to 6 percent.

Bernanke will probably have to reverse course and start tightening credit for millions of Americans even when unemployment is still high. The timing of that move will be the next big challenge for the Fed. Boosting rates too soon could derail the recovery. But waiting too long could trigger inflation and feed a speculative asset bubble. That, too, could threaten the economy, along with Americans' pocketbooks and nest eggs.

Some economists think any bump up in interest rates is still months away. Others think it won't happen until next year.

There's concern inside and outside the Fed about how the economy will fare later this year once government stimulus fades and the central bank continues to wind down support programs. Bernanke and some of his Fed colleagues don't rule out the possibility that the economy could slide back into a recession. Still, they say the risks are still low.

In his appearance before the House Financial Services Committee, Bernanke is likely to engage in a delicate dance: Sounding confident that the recovery will endure, while acknowledging that more must be done to help unemployed Americans and those forced out of their homes by foreclosure.

Bernanke also is likely to stress to lawmakers that when the time is right, he's prepared to tighten credit and reel in trillions of dollars the Fed pumped out to fight the financial crisis.

After a bruising Senate confirmation battle last month, Bernanke wants to prove to Wall Street and Main Street that he will make decisions that are right for the economy even if they aren't politically popular. The ability to boost interest rates without congressional interference goes to the heart of the Fed's independence.

Some critics on Capitol Hill and elsewhere, however, have argued that the Fed hurt its independence by bailing out Wall Street firms. That bailout backlash eroded Bernanke's support in the Senate for a second term. His 70-30 vote was the closest vote ever for the post.

--------------------------------------------------------------

- Dalcindo

[dalcindo]

Re: $GOLD - 10-Year, Monthly Chart:

Negative divergences in all indicators as noted:



- Dalcindo

[dalcindo]

Follow-Up: USD - At High, Yes ... But Should Get To Higher Last High:

Just a quick note here on the breakout from "Trend 2" channel following a short consolidation period.

As of today, that bearish channel's upper border has been violated as the USD climbs to a higher high. In the last posting regarding these competing channels (Click discussion link above), we mentioned a "Higher Last High", which I believe would represent the upper border of that "Trend 1" channel, IMHO.

Once that ultimate point is reached, I am expecting further consolidation below "trend 1" upper border with lows finding support along "trend 2".


$USD - 12-Mo., Daily:



$USD - 36-Mo., Weekly Chart:


- Dalcindo

[dalcindo]

Article - Soros: "Euro's future in question even if Greece rescued"

(Source: http://www.reuters.com/article/idUSTRE61L0CQ20100222 )

2:02am EST

SINGAPORE (Reuters) - A makeshift assistance should be enough to rescue Greece but bigger problems facing Europe would leave the future of the euro currency in question, billionaire investor George Soros said.

Writing in the Financial Times, Soros said what the European Union needed was more intrusive monitoring and institutional arrangements for conditional assistance. He said a well organized eurobond market was desirable.

"A makeshift assistance should be enough for Greece, but that leaves Spain, Italy, Portugal and Ireland. Together they constitute too large of a portion of euroland to he helped in this way," Soro said.

"The survival of Greece would still leave the future of the euro in question."

Greece's deficit swelled to 12.7 percent of gross domestic product in 2009, way above the EU's cap of 3 percent. Greece has pledged to reduce its budget deficit to 8.7 percent in 2010.

On Saturday, a magazine reported Germany's finance ministry has sketched out a plan in which countries using the euro currency will provide aid worth between 20 billion and 25 billion euros ($27-$33.7 billion) for Greece.

(Reporting by Kazunori Takada; Editing by Anshuman Daga)

© Thomson Reuters 2010. All rights reserved. Users may download and print extracts of content from this website for their own personal and non-commercial use only. Republication or redistribution of Thomson Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters and its logo are registered trademarks or trademarks of the Thomson Reuters group of companies around the world.

Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests.

-----------------------------------------------------------------

- Dalcindo

[dalcindo]

Article: IMM dollar long bets highest since Sept 2008-CFTC

Fri, Feb 19 2010

(Source: http://www.reuters.com/article/idUSN1911465120100219?loomia_ow=t0:s0:a49:g43:r1:c0.230769:b30920830:z0 )

NEW YORK, Feb 19 (Reuters) - Currency speculators increased
bets the U.S. dollar will rise to the highest level since the
week of Sept. 23, 2008, according to Commodity Futures Trading
Commission data released on Friday.

The value of the dollar's net long position rose to $9.69
billion in the week ended Feb. 16, from $9.41 billion in the
prior week.

The Reuters calculation for the aggregate U.S. dollar
position is derived from the net positions of International
Monetary Market speculators in the yen, euro, British pound,
Swiss franc, Canadian and Australian dollars.

The net short euro position at 59,422 contracts hit a fresh
record.

Speculators boosted their short bets against sterling and
reduced their long positions on the yen.

The CFTC data also showed speculators sharply increased
their bets on the Canadian dollar, with long positions at
23,455 contracts, up from 8,863 in the previous week.

To be short a currency is to bet it will decrease in value,
while being long a currency is a bet that its value will rise.

JAPANESE YEN (Contracts of 12,500,000 yen)

2/16/10 week 2/09/10 week

Long 35,691 41,352

Short 21,779 18,956

Net 13,912 22,396

EURO (Contracts of 125,000 euros)

2/16/10 week 2/09/10 week

Long 34,459 34,867

Short 93,881 92,019

Net -59,422 -57,152

POUND STERLING (Contracts of 62,500 pounds sterling)

2/16/10 week 2/09/10 week

Long 13,922 14,012

Short 70,001 66,768

Net -56,079 -52,756

SWISS FRANC (Contracts of 125,000 Swiss francs)

2/16/10 week 2/09/10 week

Long 10,763 9,219

Short 15,430 16,115

Net -4,667 -6,896

CANADIAN DOLLAR (Contracts of 100,000 Canadian dollars)

2/16/10 week 2/09/10 week

Long 35,026 24,285

Short 11,571 15,422

Net 23,455 8,863

AUSTRALIAN DOLLAR (Contracts of 100,000 Aussie dollars)

2/16/10 week 2/09/10 week

Long 43,315 44,346

Short 16,312 16,740

Net 27,003 27,606

MEXICAN PESO (Contracts of 500,000 pesos)
-1,342,317,429.41

2/16/10 week 2/09/10 week

Long 43,429 42,328

Short 8,965 10,054

Net 34,464 32,274

NEW ZEALAND DOLLAR (Contracts of 100,000 New Zealand
dollars) -525,728,850.00

2/16/10 week 2/09/10 week

Long 14,523 14,359

Short 7,088 9,636

Net 7,435 4,723
(Reporting by Wanfeng Zhou; Editing by Kenneth Barry)

----------------------------------------------------------------

- Dalcindo

[dalcindo]

Weekly Scans - Week of 22 FEB 2010:


Bucking Bull:
NPHC Nutra Pharma Corp. NASD
Count: 1


Bull Pop:
RAS RAIT Financial Trust NYSE
Count: 1


ROW x STO:
ACAS American Capital Ltd. NASD
COPI Compliance Systems Corp. NASD
RAS RAIT Financial Trust NYSE 1.37
Count: 3

Your support towards this weekly effort is much appreciated by voting at the bottom of this link:

http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID2140281

Thank you and have a great trading week!!!

- Dalcindo


-----------------------------------------------------------------

A QUICK note on the scans:
- Bucking Bull scans for bullish trend reversals that "buck" the trend;
- Bull Pop looks for unusual "pops" in priorly bearish trending stocks;
- ROW x STO screens out positively divergent stocks over weeks (The name merely stands for: RSI Over Weeks cross-reference against weekly Slow Stochastics).


DISCLAIMER:
I chose to scan stocks only at the close of each trading week, assuming that stocks that continue bullishly into the week-end are likely to remain in the trend. Therefore, although these scans occur at the close of the trading week, their bullish activities might have been underway several days prior.

-----------------------------------------------------------------
DAA

[dalcindo]

Re: $WTIC & $GASO - WEEKLY Charts: BEARISH

Hi, Tony!

RSI continues a sustained submission to its resistance line, forming a long-term negative divergence with price.

While this technical sign of impending weakness remains subtle, the line chart underneath this main chart indicates other oil or energy-related indices/ETFs expressed in relative strength against $SPX. Here, the issue is that despite a retracement from lows in $WTIC, the entire oil energy sector is likely to remain under bearish pressure, especially if the countries that traditionally drive the demand from once thriving economy are now cutting back on fuel consumption.

As indicated before, look for more fundamental news from Europe (The UK deficit news from this morning sounds catastrophic, but surprisingly remains low-key throughout most major news media network as of yet), as well as the middle east (Have I read incorrectly that the tallest hotel in Dubai closed down, while the deficit continues to grow there with yet no clear debt-management plan offered), and Asia where China is growingly under pressure to let its currency reflect its real value, hence potentially negatively impacting on its future export revenues.

Lots of very important economic and political world events going on at the moment, the impact of which is likely to pull US indices down, IMHO.

$WTIC - 36-Mo., Weekly Chart:



$GASO - 60-Mo., Weekly Chart:


- Dalcindo

[dalcindo]

Re: USD, GBP

Agreed.

No employment -> No spending -> No business earning -> No employment and no inflationary pressure on overall prices.

Now that the UK fiscal deficit is showing more of that European iceberg, I expect that once that crucial piece of news spreads, it should pressure the USD to higher levels.

The impact for our own economy is significant, since a higher dollar may deter other countries from importing US goods and services, thus stressing more US business that need that foreign consumption.

No export -> No US company revenue -> No hiring incentives -> No employment dot dot dot ...

- Dalcindo


----------------------------------------------------
Message in reply to:
unemployment rate is the key
for Fed rate change
----------------------------------------------------

- Dalcindo

[dalcindo]

Article: Shock as British deficit equals that of Greece

Fears of debt crisis as January tax receipts fall by 9 per cent overall, while public expenditure rises 15 per cent

By Sean O'Grady, Economics Editor

(Source: http://www.independent.co.uk/news/business/news/shock-as-british-deficit-equals-that-of-greece-1904129.html )

Friday, 19 February 2010



Britain's public finances are in a worse position than those of Greece, according to the latest figures on government borrowing. The Office for National Statistics said yesterday that January alone saw a net shortfall of £4.3bn, far worse than City forecasts and in a month which has always previously shown a healthy surplus. It puts the UK on track for a deficit of £180bn this year, or 12.8 per cent of GDP, economists said, shading the Greek figure, hitherto the worst in the European Union, of 12.7 per cent. In the pre-Budget report the Chancellor forecast a deficit of £178bn for the current year. Warnings that the UK could face a Greek-style crisis of confidence have been building for some weeks, and yesterday saw a sell-off of sterling and British government securities, or gilts, on the disappointing news.

Jonathan Loynes, chief European economist at Capital Economics commented: "The figures suggest that this year's budget deficit could exceed that of Greece and further underline the need for more decisive action to improve the fiscal position when the economy is strong enough to withstand it.

Related articles

* Cash crisis hits town halls from Truro to Aberdeen
* Sean O'Grady: Trouble on the streets – and in the markets
* Hamish McRae: Implosion in tax receipts leaves us with debts that could soon top GDP
* Search the news archive for more stories

"It is clear that a more credible plan to restore the public finances to health will be required shortly after the general election in order to keep the markets and rating agencies at bay."

January usually shows a healthy surplus, as tax receipts flow in from City bonuses and payments made before the final deadline for self-assessment on 31 January. Last year, for example, revenues exceeded public spending by over £5bn in the month. This year, tax receipts across the board were unusually depressed, reflecting the depth of the recession in the 2008-09 tax year. Depressed earnings in the financial sector and the general weakness of the economy conspired to push receipts down by 9 per cent overall compared with last year; income tax takings slumped by 20 per cent, and corporation gains tax revenues fell by 6 per cent. VAT payments were up a little, after the 17.5 per cent rate was restored on 1 January. On the other side of the ledger, public spending is still showing double digit increases: 15 per cent up in January, driven higher by the rise in benefits to the unemployed.

However, economists also pointed out that the total national debt carried by Britain is still lower than Greece and other so-called PIIGS – Portugal, Italy, Ireland, Greece and Spain, the eurozone's most heavily indebted nations. Although it has been expanding rapidly, UK national debt stands at about 60 per cent of GDP, against more than 100 per cent in most of these other states.

British debt is also much longer term than that of Greece, making re-financing the debt easier. November and December showed relatively good returns, but even so, all economists stressed the need for clarity on how the government will deal with the issue, whoever wins the next election. The Conservative leader, David Cameron, has explicitly likened the UK to Greece and warned that failure to deal with the deficit issue could mean higher interest rates and mortgage bills hundreds of pounds a month larger for millions of householders.

Shadow Chief Secretary to the Treasury, Phillip Hammond, said yesterday: "These appalling figures – showing the first January deficit on record – illustrate the scale of Labour's debt crisis. Every British family faces a bill of £4,800 to pay for Gordon Brown's borrowing so far this financial year alone."

Liberal Democrat Treasury spokesman Vincent Cable added that the figures "underline the importance of having a credible plan to tackle the deficit. Simply slashing spending now regardless of the economic circumstances is not only a fruitless labour but a damaging one".

The Treasury say they are sticking to the Chancellor's forecasts. Mr Darling has promised to cut the underlying budget deficit by a half within four years. Pressure on the finances of local government is also set to continue to intensify, as support from Whitehall is squeezed and local economies are hit by the continuing effects of the downturn. One of the areas hardest hit by the recession is the Midlands. Last week Birmingham City Council, the largest local authority in the country, announced 2,000 redundancies and Nottingham £18m in savings, examples of a growing tide of public-sector cuts and job losses.

£180bn

Scale of UK deficit this year, up from forecast £178bn.

---------------------------------------------------------------

- Dalcindo

[dalcindo]

Re: USD

Hi 3x!

Looks like additional fundamental events will provide further fuel for the USD to gain against the EUR and other major currencies as well.

In addition to investors unease regarding the Eurozone situation (still no concrete plans have been expressed to help Greece, while a suspicion that other weaker countries could follow suit as well such as Portugal, Spain and Italy), now comes this Fed move, which is said to normalize its discount rate. Although pretty optimistic in appearance, the move follows what other countries have already done as anti-inflationary measures.

Investors might look at the bigger picture, such as recent and repeated Chinese banks to rein in on their liquidity control and that of other banks as well, suggesting a global concerns for inflationary trends.

So, when less currencies circulate, a more difficult access to a smaller pool of cash increases the cost of borrowing, further stifling borrowing powers of individual businesses - as if lending practices were not difficult as it already is.

Overall, the USD will likely gain further strengh against the EUR, not only from a safe-haven provision AND out of concerns of what is going on in Europe at large, but ALSO from a mere fiduciary stand-point: If countries in most corners of the world are making it difficult to unleash cash and boost stock prices up, then what better than the good old Dollar to reap profits in uncertain times, especially when the Fed move is suggesting economic recovery in the context of other world turmoils.

Any Fed body language hinting at sign of steady recovery (such as this distancing from an emergency borrowing rate to a more normal discount rate) will likely continue to pressure risk-seeking investors towards risk-adversion positions, thus adding more momentum to the bearish trend of the EUR:USD trend, which we've seen commencing recently, IMHO.

My current EUR:USD position: SHORT in Both day trade and now swing positions.

- Dalcindo

[dalcindo]

Re: $INDU, $COMPQ, $NYA - WEEKLY, MONTHLY, DAILY Charts:

Significant resistance overhead for most large indices.

- Dalcindo


$INDU - 10-Yr., Monthly Chart:


$INDU - 36-Mo., Weekly Chart:



$COMPQ - 36-Mo., Daily Chart:



$NYA - 10-Yr., Monthly Chart



QQQQ - Nasdaq 100 Trust - 60-Mo., Weekly Chart



QQQQ - ONEQ - 36-Mo., Weekly


- Dalcindo

[dalcindo]

Re: $SPX's $MID & $SML:

Recent $SPX rally could be tempered by the indivisualized charts of its mid and small cap components, where recent highs are only relative and secondary indicators may call for further downside.

Notice particular resistance zone overhead in the weekly and monthly chart of $SML and $MID charts below:


$SPX - $SML - 36-Mo., Weekly Chart:



$SPX - $SML - 10-Yr., Monthly Chart:



$SPX - $MID - 36-Mo., WEEKLY Chart:



$SPX - $MID - 10-Yr., MONTHLY Chart:


- Dalcindo

[dalcindo]

Re: $SPX, VIX:TRIN:

After showing that it can stomp and remain over its 200-daily EMA, $SPX has now broken over and remained over its 50-daily EMA line.

Pretty bullish. Almost makes me want to root for that index. Go SPX?!?

Still lots of hurdles overhead, IMHO.

$SPX - 12-Month, Daily Chart:


- Dalcindo

[dalcindo]

Re: SIRI - BULLISH

Surged today; Remains in-bound within bullish channel:


SIRI - 12-Month, Daily Chart:


- Dalcindo

[dalcindo]

Article: Euro Weighed by Growth, Interest Rate and Financial Stability Doubts

Saturday, 13 February 2010 04:49 GMT

By John Kicklighter

(Source: (http://www.dailyfx.com/forex/fundamental/forecast/weekly/eur/2010-02-13-0449-Euro_Weighed_by_Growth__Interest.html )




Fundamental Forecast for Euro: Bearish

- The EU agrees fundamentally agrees to a bailout for Greece but leaves the details for a later date
- Just as financial stability concerns subside, weak 4Q GDP readings add another burden to the euro
- Is EURUSD’s steady, descending trend channel promising new lows or ripe for a reversal?


Just six months ago, the euro was prized for its growth outlook, interest rate forecasts and its status as the primary alternative to the US dollar (a currency that has fallen from grace since the financial crisis). Today, we have a very different picture of the same currency: there is little sign of a rate hike from the ECB on the horizon; Growth is very uneven across the Euro Zone’s various member economies; and the very stability of the European Monetary Union has been thrown into doubt. This is perhaps the most dramatic shift of any of the major currencies; and yet this dire fundamental backdrop is not fully appreciated. In the week ahead, the market will keep its focus on the Greece to see whether EU officials can rescue an economy that is quickly fading without evoking severe side effects along the way.

There are a few approaches the European Union can take to defuse perhaps the greatest threat to its stability in its relatively short history. However, there is no scenario that does not come with a significant potential for failure. The first option (and the most ideal for policy makers) is to maintain a verbal assurance to Greece’s stability and depend upon market sentiment to improve on its own. Realistically, the global economy and financial markets are heading toward recovery; and while the country may not reach its aggressive deficit cutting goals, the progress would be tangible and officials would allow for more time. The trouble with this picture is that risk aversion runs deeper than the health of this single economy or region; and a short-fall will simply concentrate fear around the euro. The more likely outcome is that a single economy or the group could extend a lending facility that will ensure against default and buy the economy time. Here, there is a ‘moral hazard’ issue. Other member economies will see that they will be bailed out should they breech the EU’s guidelines. And, there are more than a few members that could use aid right now and will almost certainly need it should conditions continue to deteriorate.

The more complicated and ominous scenario would be for Greece or another member to eventually secede from the Union. This is a more unlikely scenario; but there are those that believe that this is ultimately inevitable. The Economic and Monetary Union is little more than 10 years old and already major problems have developed. Sharing monetary and fiscal guidelines among many different economies will naturally develop leaders and laggards. Greece, Portugal, Spain and others are in their current state partially due to inappropriately low interest rates through the years preceding the economic crash. Now they are suffering due to 3 percent limits on debt to GDP ratios. It may take a while for such a dramatic change to come to the EMU; but will almost certainly happen eventually.

Regardless of the path officials choose to take with Greece and the fragility of their Union; there is ultimately little they can do to guarantee stability. The only definitive stabilizer would be a general improvement in risk appetite – an unlikely outcome give the abundance of fundamental cracks in the system and excess premium built into the capital markets. If the long-term continuity of the euro is cast in doubt, the currency could suffer a terminal loss of confidence. But, this would be a development that would take time. In the meantime, we will simply match the details of the Greek bailout plan with background risk appetite. And, for short-term volatility, we can look to the number of notable economic indicators that are scheduled for release. The top market movers are the ZEW survey figures and the PMI activity numbers. – JK

©2009 DailyFX. All Rights Reserved.

---------------------------------------------------------------

- Dalcindo

[dalcindo]

Article: US Dollar Outlook Depends on Federal Reserve – What Can We Expect?

Friday, 12 February 2010 23:24 GMT

By David Rodriguez

(Source: http://www.dailyfx.com/forex/fundamental/forecast/weekly/usd/2010-02-12-2324-US_Dollar_Outlook_Depends_on.html )




Fundamental Outlook for US Dollar: Bullish

- US Dollar gives up ground as Euro Zone plans Greece bailout, markets rally
- Disappointingly vague plan nonetheless sparks S&P pullback, Greenback rally
- US Dollar risks pullback in the context of a broader reversal on futures positioning


The US Dollar finished the week almost exactly where it began, confounding traders with volatile short-term moves yet remaining nearly unchanged. Similarly choppy price action in the S&P 500 underlined financial markets’ indecision and gave few clues on future short-term direction. It seems that financial markets have reached somewhat of an impasse. On the one hand, months and months of stock market advances leave more medium-term momentum to the topside. On the other, the S&P 500 and other major indices remain in a clear bear market and risk further losses following a fairly long period of appreciation. Determining which scenario is most likely is critical to establishing a clear trading bias for the US Dollar. As one of the lowest-yielding major world currencies, the Greenback often falls victim to speculative selling as traders buy higher-yielding currencies. Yet strong bouts of financial market risk aversion most often force substantive US Dollar rallies, and it remains critical to watch risk trends through short-term trading.

Options markets short-term volatility expectations on the US Dollar have pulled back in recent trade, but speculators should watch for any surprises in US economic event risk through the days ahead. Top events will start with Wednesday’s Minutes from the most recent Federal Open Market Committee rate decision to be followed by the following days’ Producer and Consumer Price Index reports. All three events threaten to force substantive shifts in market interest rate expectations and, by extension, the US Dollar.

FX traders will watch whether the FOMC gives further hints on when it may begin raising interest rates in 2010, while any especially large surprises in PPI and CPI could likewise offer clues on the trajectory of central bank rates. Fed Chairman Ben Bernanke recently outlined the steps the central bank could take to begin withdrawing massive monetary policy stimulus in an address to the US legislature. How soon those plans can be put into action wholly depends on the pace of economic recovery and trends in national prices. Recent disappointments in US Nonfarm Payrolls data would imply that the FOMC is in no hurry to tighten monetary conditions. Yet it serves to note that Kansas City Fed President Thomas Hoenig dissented in a 9-1 vote to keep the Fed Funds rate near zero for “an extended period”. Whether or not his relatively hawkish bias will gain broader traction is an important topic and it will be important to monitor the statements from the FOMC minutes.

If the Fed shows any willingness to tighten rates through the coming months or we see any substantive surprises in PPI and CPI data, the fragile US S&P 500 could break considerably lower and send the US dollar higher. Overnight Index Swaps show zero percent probability that the Fed will raise interest rates through the coming months. Stock markets rarely respond positively to higher borrowing costs, and any signs that rate hikes could come sooner could easily crimp risk sentiment. Given clear indecision across financial markets, clarification could spark the trends that most traders crave. - DR

When do you think the dollar will break? Will the next drive be bullish or bearish? Discuss the dollar’s future in the DailyFX Forum.

For more timely FX market analysis, take advantage of the DailyFX Real Time News service.
©2009 DailyFX. All Rights Reserved.

---------------------------------------------------------------

- Dalcindo

[dalcindo]

F/U: $GASO, $WTIC - Continued BEARISH pressure

Some extrinsic events have occurred in the news today, worth considering effective on $GASO today.

1 - Capture of Taliban #2 man, which in the mind of investors contributes to much of the world unrest and wild oil fluctuations. Although not the end of a history of the world saga, this international story is likely to warm up investors to the still far-fetch idea that South-East Asian and Middle Eastern countries may gain more political stability in their respective oil-dependent rich governments.
(News Source: http://www.reuters.com/article/idUSTRE61F0FE20100216 )

2 - President Barack Obama is unveiling for the first time in a very very long time plans to develop nuclear energy in the US. While the plan is far from being materialized into an oversized cement-made shot glass in some suburban landscape, I can see how France or similar other European (which have numerous experience on construction and maintenance of alternative,nuclear energy dependence) could provide the know-how for acceleration of such plants and make the US a less oil dependent country. Before that, I expect some agonizing and lengthy debates on nuclear risks vs. oil dependence.
(News Source: http://news.yahoo.com/s/ap/20100216/ap_on_bi_ge/us_obama_5 )


If oil rallied to higher levels, expect further public division and political rhetoric on nuclear development issues.

For now, $GASO continues to test its recent support line, lending yet more credence to a downside scenario (See first chart: "$GASO - 60-Mo., Weekly Chart" below), whereas $WTIC failed to break over the higher border of the bearish mid-line (drawn clear back in mid-July 2008 - Man, I was so young and innocent back then, LOL), and this after it failed to short-term channel midline support of its bullish channel (See second chart: "$WTIC - 36-Mo., Weekly Chart" below).


$GASO - 60-Mo., Weekly Chart:




$WTIC - 36-Mo., Weekly Chart:


- Dalcindo

[dalcindo]

Re: EUR:USD retracement

Hi, 3X!

Very exciting market today, indeed.

Currently, the pair is retracing along two significant Fibonacci overlays:

One shorter-term interval Fibonacci representing a price range from 12 JAN 2010 HIGH = 1.45791 to 11 FEB 2010 LOW = 1.35318 with the following retracement levels:

1 - 23.6% = 1.37788 (approximated earlier today @ 11:15 central time)

2 - 38.2% = 1.39318

3 - 50% = 1.40531

4 - 61.8% = 1.41790

5 - 100% = HIGH


The other longer-term interval Fibonacci representing a price range from 24 NOV 2009 HIGH = 1.5144 to 02 MAR 2009 LOW = 1.24562 with the following retracement levels:

1 - 23.6% = 1.34789 (unattained as of yet)

2 - 38.2% = 1.37993 (reached 09 FEB 2010 @ 10:00)

3 - 50% = 1.41162

4 - 61.8% = 1.45093

5 - 100% = HIGH

Because EUR and USD index charts are printed only at EOD, I try to obtain some "directional aroma" from the ETF of USD's PowerShare Index Bullish/Bearish Fund charts, especially the relative strength chart, considering that the original USD index is weighed against the average of 6 other major currencies. So, the intra-day moves should be as close as it can get to its market sentiment:


I believe that a move over the 38.2 = 1.37993 (already reached 09 FEB 2010 @ 10:00) would represent some insistence from investors to bring the EUR:USD pair to the next Fib level of 50% = 1.41162.

If that rally failed, look for further down-trend below recent LOW = 1.35318.

For now, the trend favors a testing of the shorter Fib interval with 23.6% = 1.37788 as target value. Although approximated earlier today @ 11:15 central time, it still remains to be physically touched for any substantial signal of reversal or continuation to appear, IMHO.


OUTLOOK:
However, the long-term perspective keeps the EUR:USD pair bearish, granting the USD more possibilities towards the downside. If the market allows he pair to unwind a bit with the intention to throw it to lower lows, then look for shallow retracement to the 38.2% level in the short-interval Fib values above.

Incidently, the DAILY UUP chart (not posted here), may provide some early indication whether that relaxation is just that, or whether it is the beginning of a bearish trend for the USD. For this indication, look for the daily 200-EMA line, which is about to be tested today or very soon this week.


$USD ETF (UUP vs. UDN: RS) - PS Index Bullish/Bearish Fund - 12-Mo., Daily Chart:


- Dalcindo

[dalcindo]

Re: $GASO - Technical Conundrum:

Of technical interest, here comes this conundrum:

1 - Megaphone top (i.e.: BEARISH)?

or

2 - Continuation ascending triangle (i.e.: BULLISH)?

Line violation (support of resistance0 will likely provide a definitive answer.

Technically speaking:
1 - However, RSI has been under sustained bearish pressure for now over TWO years; recently developed a negative divergence with price while remaining under the 70-level
2 - MACD continues to hover over the "positive zero-line";
3 - But, ADX fails to produce any trend strength signal.

OVERALL - Chart favors bearish down-turn per RSI pattern alone (too weak to posit any definitive position):


$GASO - 60-Mo., Weekly Chart:


- Dalcindo

[dalcindo]

Re: USD - At High, Yes ... But Should Get To Higher, Last High:

Hi, 3x!!!

There are indeed many strong technical events that are calling loud and clear for a relaxation in the recent USD advance, and this is getting even clearer every day I trade the major EUR:USD pair.

When you posted "USD time to retreat", I took it as a comment and looked into it based on daily, weekly and monthly charts. I also looked at other mitigating charts such as the EUR and USD indices and their relative strength expression: EUR:USD, as well as the UUP, UDN and their relative strength expression: UUP:UDN.

I have the say that at this point, there are no clear line up of leading or lagging indicators favoring a continuation of the recent bullish ride, or a resounding alarm for imminent reversals.

Instead, I continue to find two competing trends (one in a shorter timeframe than the other) suggesting serious resistance ahead.

For instance, Trend (1) in the DAILY chart below - which had received a long historical validation warranting its significance over time - suggests that the price for daily $USD continues to have more room before it reaches the upper border of that bearish channel. However, Trend (2)
suggests that the rally has maxed out, and a decline is overdue.

Incidently, two similar trendlines of equal significance (borne out of "Convergence-Hi" points in the WEEKLY chart below) are also defining a similar conundrum regarding the due timing of a decline. in fact, the current weekly close is calling for a decline also based on a "multi-line convergence" of significant resistance lines, which combined are dead on for calling a decline.

A third and last case of confounding signals also come from the MONTHLY chart below, which indicates that price has not reached the significant mid-point of the bullish channel which was defined as far back as September 2008.

So, what's the deal? I believe that the confounding signals are leaving a significant window of probabilities expressed in the daily trends (1) and (2), but that technicals favor a higher attainable close before the price folds back to support levels.

TECHNICALS FAVOR HIGHER CLOSE:
I do not bet any position that the price will for sure close higher, so I continue to scalp the dollar short and would not dream of leaving any overnight speculative positionts ... Much less over the week-end.

However, technical events that favor a higher attainable close before a significant down-turn in the greenbacks are:

DAILY Chart:
1 - RSI's uptrend remains unviolated, while its 14-RSI line has re-penetrated over the 9-RSI's 14-EMA line. This may be obscure an event, but the timeframes required for this "surge-within-a-surge" suggests an undying bullish sentiment against all odds. This in fact reminds me of the financials that kept going and going against a fundamental background of bad reports, more bank closures, and uncertain consumer market. Therefore, for this bullish-within-bullish event to occur, there's got to be some savvy info driving the spearhead to higher indicator levels.
2 - Secondry indicators in the CCI, Slow STO, Wm% and PPO show that at the current highs, signal lines are reflecting yet another bullish upturn, as they are kicking upwards even at the close of the week itself. Some residual bullish expectation is shaping this chart, IMHO. Finally, the ADX is kinking back up at mid-level, suggesting that the recent fade in up-trend is expected to be renewed, especially as (+)DI remains well within reasonable bullish range.

WEEKLY Chart:
1 - Here, RSI is remarkable bearish, having been stomped at the critically defining 60-level for any bearish reversal to occur. However, the line-up of secondary indicators that I usually follow failed to provide any strong signal of "Pre-Decline Pattern" formation, adding more doubt overall to any certain decline.
2 - Secondary indicators, as just discussed remain well within bullish territories. Even the Slow STO has not yet neared the signal line to provide any imminent threat of a decline, IMHO.


MONTHLY Chart:
1 - Finally, this monthly RSI lacks the synchrony needed to line up with its daily and weekly counter-parts, although it recently defined a more tapered curved suggesting that, although a high is imminent, there may be some more terrain to cover.
respective shapes. Not that the shape of the indicators should shape the path of price, but I do not see any clear fatigued curves within this less sensitive chart (i.e.: the daily chart should still remain a more sensitive tool of reversal measurement, which in itself remains ambiguous in that regard, still).

So, overall, I have to go by the charts and expect that, although some significant resistance will apply against USD this coming week, a last gasping surge may provide the technical validation of these channel upper borders in the daily chart before a certain decline materializes.

I realize that I type way too much - Although I do this to document my TA in details. However, for interest of time, I will spare you further comaprative analysis on UUP, UDN and relative strength expression thereof. Thank you for reading thus far. Sincerely. Dalcindo.

$USD - 12-Mo., Daily:



$USD - 36-Mo., Weekly Chart:



$USD - 10-Year, monthly Chart:



- Dalcindo



---------------------------------------------------------------
Message in reply to:
USD time to retreat

---------------------------------------------------------------

- Dalcindo

[dalcindo]

Weekly Scans - Week of 15 FEB 2010:


Bucking Bull:
CPE Callon Petroleum Co. Del NYSE
Count: 1


Bull Pop:
AKYI AccessKey IP, Inc. NASD
Count: 1


ROW x STO:
URST Uranium Star Corp. NASD
WEN Wendy's/Arby's Group Inc. NYSE
Count: 2


Feel free to give a "thumbs up" support towards this weekly effort at: http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID2140281 by voting at the bottom of that link - Much appreciated!

Have a great trading week!!!

- Dalcindo


-----------------------------------------------------------------

A QUICK note on the scans:
- Bucking Bull scans for bullish trend reversals that "buck" the trend;
- Bull Pop looks for unusual "pops" in priorly bearish trending stocks;
- ROW x STO screens out positively divergent stocks over weeks (The name merely stands for: RSI Over Weeks cross-reference against weekly Slow Stochastics).


DISCLAIMER:
I chose to scan stocks only at the close of each trading week, assuming that stocks that continue bullishly into the week-end are likely to remain in the trend. Therefore, although these scans occur at the close of the trading week, their bullish activities might have been underway several days prior.

-----------------------------------------------------------------
DAA

[dalcindo]

Re: BDH - Broadband Holders ETF/NYSE: QCOM Pulling Its Weight Down

Having weighed down the BDH mostly on its own, QCOM is giving out technical signals of reversals. Look for overhead resistance imposed by the 200-EMA = 11.62 in this daily chart:



- Dalcindo

[dalcindo]

Re: QCOM - Testing Bullish Channel Bottom:

This significant technical event is occurring in both the WEEKLY and MONTHLY charts - Combined, they may bring two large sets of investor support together and force a rally within the respective channels:

QCOM - 60-Mo., Weekly Chart:



QCOM - 60-Mo., Monthly Chart:


- Dalcindo

[dalcindo]

Re: PDMI - Daily, Weekly, Monthly Charts:

Charts have remained untouched since last OCT/NOV 2009 - Channels are still holding up:

Technical Note:
DAILY - Price banging head against 200-EMA overhead - Watch for retracement and wild swings here.


PDMI - 12-Mo., Daily Chart:



PDMI - 36-Mo., Weekly Chart:



PDMI - 60-Mo., Monthly Chart:


- Dalcindo

----------------------------------------------------------------
Message in reply to:
PDMI CHART 0.0018

----------------------------------------------------------------

DAA

[dalcindo]

Re: GBP:USD

Pre-rally pattern continues validation. Watch for strong resistance at $157.59, which corresponds to support-turned-resistance at significant Fibonacci value of 38.2%.

- Dalcindo




- Dalcindo

[dalcindo]

Re: GBP:USD

(From private messaging; $XBP-British Pound Index Chart below)

----------------------------------------------------------------

Re: GBP-USD
...
From:
David Xxx <[e-mail]>
...
View Contact
To: "[e-mail]" <[e-mail]>
Hi Xxxx!

I have not been trading or analysing the GBP:USD pair. Only the EUR:USD pair.

However, the short term outlook in pairs that involve the USD should unwind to favor a short-term gain AGAINST the US Dollar.

Using a daily chart, there is significant market support at 1.5550.

Extending a Fibonacci grid upwards, the next significant resistance levels are:

1.5651

1.5727

1.5800

Let me know if you need charting material for this or any other currency pair/equity/index.

David


Sent from my iPhone

On Feb 8, 2010, at 19:25, [e-mail] wrote:

Hello David,
I was just curious if you had called this move to this level? Where do you see it going from here?
My options account is not yet operational, but it never hurt to look around.
Hope all is well with you and Xxx.
All the best,
Xxx
Xxx X. Xxx
XXX,LLC
Durango, CO
Sent from my Verizon Wireless BlackBerry
----------------------------------------------------------------



Dalcindo

[dalcindo]

Re: USD - Short-Term Shallow, Fib-Paced Rally; Mid-Term Decline Continuation

Overnight, the EUR:USD pair rallied to a significant Fibonacci 38.2% level on a daily chart. This target was established using the 12 JAN 2010 HIGH = 1.4579 and 04 FEB 2010 LOW = 1.3629.

While the Eurozone is devising various ways to patch its financial crisis, the situation remains critical on at least two relevant questions. First, how temporary are these financial measures? Second, What about the economic burdens of Portugal, Spain, Italy? I believe that the current rally is to remain shallow (along these Fibonacci levels) on the basis that investors are likely to raise these questions but face uncertain answers regarding the overall European outlook.

On a different front, we are also discovering that the US economy has been exposed to some degree to the Greek financial crisis. While this fact was not revealed during the early development of this off-shore crisis, the media are now bringing this home in terms that should affect the USD within the EUR:USD pair.


OVERALL, I expect a shallow Fibonacci-paced retracement in the short-term, while the mid-term outlook still favors deeper downside on the basis discussed above.

Happy trading!

- Dalcindo


$XEU:$USD (RS) - 12-Mo., Daily:



$XEU:$USD (RS) - 3-Yr., Weekly Chart:



- Dalcindo

------------------------------------------------------------------
Message in reply to:

Re: $USD Pullback Per Fibonacci; Relative strength charts: $XEU vs. $USD:

Hi, 3x!

Still trading off of oanda.com platform here.

High = 1.37114
Low = 1.36438

Positions at 100,000 units each for Fibonacci retracement levels:

- 21.4% = 1.36596 target - Reached, still in position with 300,000 units; moved stop loss to 7%

- 38.2% = 1.36695 target - Reached right now; position unchanged; moved stop loss to 15%

- 50.0% = 1.36776 target - Pending; expecting selling 1/3 of position

- 61.8% = 1.36854 - Pending; expecting to sell 1/3 position

- 100% - High = 1.37114; speculative interest in keeping this position based on favorable longer timeframes (i.e.: 15-minute and 60-minute charts still favor a higher retracement; secondary indicators are getting taut and demand some unwinding.

Long-term outlook remains favorable for the USD in this major pair.

Current support = 1.26607 = 55-EMA on 5-minute chart (actually just got validated as of this typing).


$XEU:$USD (RS) - 12-Mo., Daily:



$XEU:$USD (RS) - 3-Yr., Weekly Chart:



------------------------------------------------------------------

DAA

[dalcindo]

Follow-Up: VIX - Short/Mid-Term Futures - 12-Month, Daily Chart:

RSI is testing BULLISH range. This reflects a growingly BEARISH market-wide outlook. Watch for a renewed decline trend in major indices.


VIX - Short/Mid-Term Futures - 12-Month, Daily Chart:


- Dalcindo

-----------------------------------------------------------------
Message in reply to:

Re: VIX & SPX; Economic Calendar - Short/Mid-Term Futures:

Short-term futures have lost ground against their mid-term counterparts, possibly indicating that recent short-term economic data - however positive they may have been - remain overshadowed by longer-term concerns regarding budget deficit and plans to dig a bit deeper into national debt.

VIX Chart:
As indicated in an earlier post, VIX's chart pits short-term futures against mid-terms' to help decipher early directional changes and sentimental trends among investors.

Although no clear signals have emerged indicative of a market reversal to the down side, trendlines and patterns of sentimental changes have emerged in the chart.

Of note, the 45-daily EMA has been tested once more recenttly - this technical gaining increased meaning since it occurs while positive divergences have developed concurrently (see MACD against price, as well as ChiOsc against A/D and OBV lines).

For now, look for shallow retracements, further positive divergences, as well as ADX line and its (+)DI ascent into a more trend-defining range for further indication of any trend reversals in SPX.


Direxion vs. SPX:
Using Direxion's ETFs where large (BGU) and small (TNA) caps, energy (ERX) and financials (FAS) are expressed in relative strength against the S&P 500 (Second chart below), recent market decline has been tempered by a bullish candle, indicative of residual bulls resiliency, the duration of which will depend on upcoming market data scheduled throughout this week.


Economic Calendar for this week:
Look for improvement in:
1) pending home sales (MoM) later on today
2) ISM non-manufacturing composite data tomorrow
3) non-farm payrolls on Friday.



------------------------------------------------------------------

DAA

[dalcindo]

Re: $USD Pullback Per Fibonacci; Relative strength charts: $XEU vs. $USD:

Hi, 3x!

Still trading off of oanda.com platform here.

High = 1.37114
Low = 1.36438

Positions at 100,000 units each for Fibonacci retracement levels:

- 21.4% = 1.36596 target - Reached, still in position with 300,000 units; moved stop loss to 7%

- 38.2% = 1.36695 target - Reached right now; position unchanged; moved stop loss to 15%

- 50.0% = 1.36776 target - Pending; expecting selling 1/3 of position

- 61.8% = 1.36854 - Pending; expecting to sell 1/3 position

- 100% - High = 1.37114; speculative interest in keeping this position based on favorable longer timeframes (i.e.: 15-minute and 60-minute charts still favor a higher retracement; secondary indicators are getting taut and demand some unwinding.

Long-term outlook remains favorable for the USD in this major pair.

Current support = 1.26607 = 55-EMA on 5-minute chart (actually just got validated as of this typing).


$XEU:$USD (RS) - 12-Mo., Daily:



$XEU:$USD (RS) - 3-Yr., Weekly Chart:

[dalcindo]

Follow-Up (08 FEB 2010): AAPL - BEARISH

As indicated in prior AAPL analysis (See links above), the current price pattern relative to resistance/support lines and secondary indicators continues to delineate a bearish path.

More specifically, we first projected that on a short-term basis, AAPL would rally towards to a 38.2% Fibanacci - corresponding to $199.93 within the first half of that past trading week. In effect, at mid-week, price reached a $199.79 high before testing the lower border of its bullish channel.

In fact, a very-short-term channel was then delineated ("Blue channel") to follow the momentum of that short-lived rally and detect with some degree of precision the price where it would breakdown. That breakdown occurred again where we had expected it: immediately following the reached Fibonacci target.

As of this trading day (08 FEB 2010), in a way that connfirms added bearish outlook, AAPL has now validated its prior support into a new resistance level (i.e.: the line along which where the "blue channel" used to offer price support), thus throwing the price back to renewed lows.


OVERALL:

Looking at the week ahead, there remain some pros and cons worth considering before committing to one directional trend:

- PROs: RSI and secondary indicators are forming lower highs, as well as higher lows, hence creating flags, or patterns of consolidation that have yet to commit to either bullish or bearish direction within this 60-minute chart. In fact, weekly and daily RSI patterns still remain open to further upside, but the recent break-down in bullish constructions within a smaller timeframe may already herald the end of that run.

- CONs: From a general standpoint, the S&P 500 is generating bearish sentimental signals through its VIX. As mentioned before, we constructed a VIX short-term vs. mid-term chart to detect early directional changes among investors. As of this date (08 FEB 2010, close of trading day), VIX's relative strength chart remains favorable towards a bearish characterizaton of the overall market (see VIX's relative strength chart below).

Considering this bearish environment where the anticipation is growingly favoring a declining market, expecting further influx of supporting buyers into AAPL becomes more of a speculative exercise. Unless AAPL forgot to reveal some other mind-blowing news about its iPad, I believe that the charts continue to discount any known underlying fundamentals: what you see is what you get, and what I get from the chart is that the market is growing colder towards AAPL.

Technically speaking, the technical developments discussed above are weighing in favor of a greater downside.

More specifically (considering a 60-minute chart):
- RSI double-topped at points where price is reaching a lower high
- The lower high at which we are today, the secondary indicators in CCI, Wm%R, CMF and PPO's histo remain toppish, while the ADX is marking a renewed down-trend strength (ie.: ADX is kinking back up at the 20-level, at a point where (-)DI is crossing over (+)DI)
- A/D, OBD and ChiOsc lines are also turning down at that same point where RSI double-topped and Price hit its head against its resistance line.

Internal technicals are indicating a growingly bearish mass of investors. Please, feel free to review other charts and TA here: As I receive private message comments on indices and specific stocks, I will continue to reply via PMs and post replies nonymously. Thank you for the stimulating technical discussion.

- Dalcindo

AAPL - 30-Day, 60-Minute Chart:



VIX Short vs. Mid-Term Futures - 12-Month, Daily Chart:


- Dalcindo

[dalcindo]

Weekly Scans - Week of 08 FEB 2010:


Bucking Bull:
ISCO International Stem Cell Corp NASD
LAB LaBranche & Co., Inc. NYSE
SIRI Sirius XM Radio Inc. NASD
Count: 3


Bull Pop:
MSBT MedaSorb Technologies Corp. NASD
Count: 1


ROW x STO:
Count: 0


Please, feel free to give a "thumbs up" voting and support towards this weekly effort at: http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID2140281 - Much appreciated!

Have a great trading week!!!

- Dalcindo


-----------------------------------------------------------------

A QUICK note on the scans:
- Bucking Bull scans for bullish trend reversals that "buck" the trend;
- Bull Pop looks for unusual "pops" in priorly bearish trending stocks;
- ROW x STO screens out positively divergent stocks over weeks (The name merely stands for: RSI Over Weeks cross-reference against weekly Slow Stochastics).

DISCLAIMER:
I chose to scan stocks only at the close of each trading week, assuming that stocks that continue bullishly into the week-end are likely to remain in the trend. Therefore, although these scans occur at the close of the trading week, their bullish activities might have been underway several days prior.

-----------------------------------------------------------------
DAA

[dalcindo]

Re: $USD - Inverse Relation, But How Long?
- US vs. European, Asian Markets:

Hi, 3x!

$USD does seem to react inversely to $COMPQ and $SPX (See Chart #1 below: Inverse Correlation & Relative Strength chart below).

Obviously, the risk-seeking investors that have taken positions in US or foreign equities/indices have provided the greatest influence by trying their luck out of the dollar into bullish markets, then seeking shelter back in the $USD's safe-haven in bearish weathers. Stockcharts.com does not provide any more data past 2007, but that relationship from that data provider remains clear about this inverse relationship dating since about July 2008, when the dollar soared against plummeting US markets.

As I mentioned in prior entries, I have set the US rally high to around $81.00, a point at which technical chart features would be calling for some unwinding. Most influential so far in the monthly chart has been the 45-EMA, currently valued at $81.21 in Chart #2 below - As the greenback continues ins ascent within the confines of that bullish channel (validated since 2008), I am expecting a serious level of resistance at the mid-channel level. So if current momentum continues, that would set a target near $83.00. So, on average, a technical target of $82.00 becomes very reasonable, especially if the currently bearish market continues to provide its influence on the USD, as the risk-adverse crowd of investors continues to come home.

The question becomes: How long is this inverse relation lasting? I believe that the market is currently revaluing the $USD in relation to the total US equity market, and that the answer may come as soon as this year. 2008 was the year of formation of this inverse relationship, whereas 2009 was a year of migration in and out of the US currency (i.e.: maintaining that relationship). 2010 may become the year when investors equate a faltering market with a faltering US Dollar, if and only if foreign markets continue to rally against the European and US markets (i.e.: old world market vs. new and more efficient dynamic markets).

In an older entry, I remarked that our US and European populations are composed of a majority of retiring individuals whose wealth has been diminished, and their health care stress on either economies will growingly pressure their respective countries downwards, while the youth would be replacing the skilled labor at too slow of a pace.

A propos of inverse relationships, Asia is dealing with the opposite demographic conundrum. Lots of young, dynamic firms and mind ready to work longer, harder with an insatiable appetite for the things we are growingly failing to afford over here: time, financial risk, and credit worthiness.


The wheel is turning:
See for instance how the majority of the European markets (not including US market) have failed their 200-EMA (Chart #3-5 below) COMPARED TO Asian markets that have remained over their 200-Weekly EMA (chart #6-8 below):


Chart #1: $USD vs. $SPX/$COMPQ - 3-Year, WEEKLY Chart:



Chart #2: $USD - 10-Year, monthly Chart:



Chart #3-8:
$CAC - 36-Mo., Weekly Chart:



$DAX - 36-Mo., Weekly Chart:



$FTSE - 36-Mo., Weekly Chart:



$HSI - Hong Kong Hang Seng - 36-Mo., Weekly Chart:



$NIKK - Tokyo Nikkei Avg. - 36-Mo., Weekly Chart:



$STI - Singapore Strait Times - 36-Mo., Weekly Chart:




--------------------------------------------------------------------
Message in reply to:
$USD breaking that 50dma resistance is crucial for continuing its uptrend,
82 would be the next stop, see how the market reacted inversely to the $$$ movement since summer 2008, current support at 9845



--------------------------------------------------------------------

DAA

[dalcindo]

Re: AAPL - Bullish Channel Lower Border Getting Validated:

Look for reactive bounce from automated buy-in positions at current lows. If the sellers buy out these positions out of bearish outlook, then look for stop losses getting shredded through.

HINT: Look for VIX chart below ...


AAPL - 30-Day, 60-Minute Chart:



VIX Short vs. Mid-Term Futures - 12-Month, Daily Chart:


- Dalcindo


----------------------------------------------------------------
Message in reply to:
AAPL at critical level.. we bounce or we crash below?
----------------------------------------------------------------

[dalcindo]

Re: USD - At Major Technical Resistance Level - Daily Chart:



D.

[dalcindo]

Follow-Up/Day Two: AAPL - Fib Target Met; RSI Looks Toppish:

(See link above for prior TA)

AAPL reached its significant target today, which we have set at the significant Fib's level of 38.2% retracement, or $199.93.

In fact, bulls pushed the highest candle shadow to a high of $200.20, but bears riposted to a close of $199.79 before starting a renewed decline. A remarkable thing about technical analysis is not that the price walked into the footsteps of the Fibonacci levels, but that such an ancient methodology works til this new decade.

We also discussed that once that Fib level would be reached, the chance of a downward continuation would increase.

As of this close of trading day, 14-RSI failed to reach over the 60-level, indicative that its recent rally from below 30-level should now confirm a bearish reversal signal for AAPL. Therefore, the probability of any further incursion above today's high has become extremely low.


AAPL - 30-Day, 60-Minute Chart:


- Dalcindo

[dalcindo]

Re: $SPX - FIB & 42-Day Cycle Chart:

Watch for this important support line:


$SPX - FIB & 42-Day Cycle Chart:


- Dalcindo

[dalcindo]

Follow-Up: AAPL ... Still On Track Per Fib's:

(See link above for prior TA)

Kamillion,

Hope you are still riding that AAPL.


... Still on track along the good ole Fiby. Very short-term trading channel applied for current momentum; may not last past the first Fib level; expecting consolidation at that level into the week.

Also, 21-WEEKLY EMA (not included below) provide strong support going ahead:


AAPL - 30-Day, 60-Minute Chart:


- Dalcindo

[dalcindo]

Re: VIX & SPX; Economic Calendar - Short/Mid-Term Futures:

Short-term futures have lost ground against their mid-term counterparts, possibly indicating that recent short-term economic data - however positive they may have been - remain overshadowed by longer-term concerns regarding budget deficit and plans to dig a bit deeper into national debt.

VIX Chart:
As indicated in an earlier post, VIX's chart pits short-term futures against mid-terms' to help decipher early directional changes and sentimental trends among investors.

Although no clear signals have emerged indicative of a market reversal to the down side, trendlines and patterns of sentimental changes have emerged in the chart.

Of note, the 45-daily EMA has been tested once more recenttly - this technical gaining increased meaning since it occurs while positive divergences have developed concurrently (see MACD against price, as well as ChiOsc against A/D and OBV lines).

For now, look for shallow retracements, further positive divergences, as well as ADX line and its (+)DI ascent into a more trend-defining range for further indication of any trend reversals in SPX.


Direxion vs. SPX:
Using Direxion's ETFs where large (BGU) and small (TNA) caps, energy (ERX) and financials (FAS) are expressed in relative strength against the S&P 500 (Second chart below), recent market decline has been tempered by a bullish candle, indicative of residual bulls resiliency, the duration of which will depend on upcoming market data scheduled throughout this week.


Economic Calendar for this week:
Look for improvement in:
1) pending home sales (MoM) later on today
2) ISM non-manufacturing composite data tomorrow
3) non-farm payrolls on Friday.






- Dalcindo

[dalcindo]

Re: AAPL - Hourly, Weekly, Monthly Charts:

Kamillion,

AAPL's 60-minute chart is lining some important sets of oversold indicators, which I track for formation of reversals (See: "Pre-Rally Pattern" in 60-minute chart below). However, these do not provide any information as to how "high" the rally would occur.

Instead the Fib grid or the RSI retracement calculations might help define a target:

Using Fib's, it concurs with your exit target of $200/share. In fact, the 38.2% Fib retracement places that target precisely at 199.93%.

In a more esoteric method, calculating RSI's positive divergent values against that of price ($197.75 - $190.83 = $6.92; $197.75 + $6.92 = 204.67) would define a technical target NEAR the next Fib's level of 61.8%, or $204.67.


OVERALL:

Short-Term View - (See AAPL hourly and weekly charts below):
I am expecting a short-term rally earlier this week (This new trading week opens in less than 4 hours as of this writing). Whether this brings it before your expiration day (in three weeks from now) would be hard to even guestimate. However, the "(S)UTC" has helped me in the past in this regard, by extending the strongest support line forward in this and establishing a "lowest achievable equity value" - as long as that line remains unviolated, of course.

Long-Term View - (See AAPL's monthly and Nasdaq's yearly charts below):
In the long term (See $COMPQ chart - Last chart below), a year ago, I drew a speculative downtrend channel ("(S)DTC") on 16 JAN 2009 that projected the "Highest Achievable Equity Value" for that index. Interestingly, that value was reached right at the upper border of the bearish channel earlier this year. Considering the leading position AAPL holds in that index, and the validity of that long-term channel, I continue to believe that the long-term outlook for AAPL is not as good as its short-term expectation, as discussed above.

Please, let me know how your trade turned out at the end.

Best of luck.

- Dalcindo


AAPL - 30-Day, HOURLY Chart:



AAPL - 36-Mo., Weekly Chart:



AAPL - 5-Year, MONTHLY Chart:



QQQQ - Top 4 Holdings: AAPL, QCOM, MSFT, GOOG - 12-Mo., Daily:



$COMPQ - 29-Yr., Monthly Chart:



- Dalcindo


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Message in reply to:
hey D, thanks for the thorough response. to answer ur questions,

i am very long
timeframe = asap
expiration = february

ill be out for the day but viewing ihub from my phone from time to time. i posted a chart a couple threads down that in my view shows aapl is at a temporary support going into monday, with a max gain of 207.50 where a gap lies. looking forward to more of ur aapl analysis. thanks.

actually, heres the chart again, i think i can repost it. $200/share would be my target. and probably where i would exit, bc i always exit early lol
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DAA

[dalcindo]

Article - The Forecast for Financials

By Ben Baden , On Thursday January 28, 2010, 4:33 pm EST

(Source: http://finance.yahoo.com/news/The-Forecast-for-usnews-1376704935.html?x=0 )

In Wednesday's State of the Union address, President Obama reiterated his plans to propose a tax on some of the country's largest banks and legislation that could limit their size and restrict certain types of trading. A wave of populism has swept through the country, and big banks seem to be bearing the brunt of citizens' frustration. Questions about what the final proposals will seek to accomplish has rattled the stock market. What does this antibanker sentiment in Washington mean for investors? Jeff Arricale, manager of the T. Rowe Price Financial Services Fund (symbol PRISX), says that uncertainty about potential regulation hasn't stopped him from investing in some of the biggest names in the banking industry. He runs a sector fund, meaning it primarily focuses on one slice of the market. The fund returned 28 percent in 2009 and an annualized 5 percent over the past decade. U.S. News spoke with Arricale to get a better understanding of the situation and who's most likely to be affected by further regulation of Wall Street. Excerpts:


Since the darkest days of the recession, how much improvement have you seen in the financial sector?

As we shifted into the end of 2008 and spring of 2009, fundamental analysis on banks, credit, and the overall environment suggested credit issues would begin to abate and it was appropriate to start increasing investments in the big money-center banks like Bank of America and JPMorgan and the regional banks like Fifth Third, First Horizons and Key Bank. ...We believed credit loses will peak in 2010. We still hold that view, and when we look at fourth quarter earnings, that seems to be what is happening. Basically, losses are moderating, and reserve building, which means setting aside earnings to cover future losses or the rate at which companies are increasing their reserves, is declining. Importantly, the net interest margins--basically, the difference between what they pay on deposits and what they make on loans--is expanding. So the fundamentals overall are incrementally getting better. They're not good yet, but they're getting better, and they're likely to continue to get better through 2010. We think the banks will be back to normal earnings and return to profitability in 2012, so our investment thesis is longer-term in nature.


How have you positioned your fund?

We've shifted from a defensive posture in 2008, where we had lots of property casualty insurance and about 10 percent cash, to one where our largest exposure is banks and regional banks. We have less cash, and we're really more aggressively positioned. What would derail our thesis is if unemployment really spikes higher. That will cause more people to default on credit cards and mortgages and lending will continue to be restricted, and I don't think our fund will do very well in that environment.


What exactly is Obama proposing?

They're proposing a tax based on basically the size of the bank's balance sheet, and it could impact earnings anywhere from very modest levels to somewhere between 5 and 10 percent. It's unclear. So there's that proposed bank tax that would disproportionately punish the large banks, and there's the Volcker plan, which among other things would encourage or force some of the large banks to cease activities in private equity and hedge funds and what they call proprietary trading. ... That goes on all the time, and that's how the banks make their money. It's the service they provide. They're a source of liquidity for buyers and sellers. ... It's in many ways hard to disaggregate what's client-driven activity and what is trading for the investment bank's own account. Sometimes it's very clear and sometimes it's very opaque. ... It becomes very difficult to define what is proprietary trading and what is just risk management. It's a very difficult task that the regulators and politicians have taken on.


What companies will be most affected by this potential legislation?

You can paint scenarios where companies like Goldman Sachs could have 10 percent of their earnings that could potentially have to be divested to zero, and again, we don't know. Bank of America does the same thing as Goldman Sachs, but Bank of America is also a gigantic, plain vanilla deposit-taking, commercial loan-making, mortgage loan-making institution. Goldman Sachs doesn't do that, but both banks happen to have very large investment banks that do these kinds of things. So JPMorgan, Citigroup, Bank of America, and to a lesser extent Wells Fargo have the kind of operations that we're talking about. However, they're a much smaller part of the overall organization than they are for Goldman Sachs and Morgan Stanley because Goldman Sachs and Morgan Stanley typically aren't big deposit-gathering institutions, and Morgan Stanley happens to have a big retail brokerage. They've just made less money in proprietary trading and trading overall than Goldman Sachs, so when you look at who has the most to potentially lose, Goldman stands out. ... Then, of course, there's some probability that this is all populist, midterm election year posturing and it does not address any of the systemic considerations and problems that actually need to be addressed and it's all going to go away or be largely diluted. So you have a continuum of outcomes to where a company like Goldman Sachs has to stop some activities and you could see their earnings be impacted by maybe 10 percent.


Does the threat of this regulation affect your investment strategy?

For Goldman Sachs and Morgan Stanley, I think the shares adequately reflect the risk we're talking about. The companies have very strong business sheets. In fact, they're now excessively capitalized. They've picked up a lot of market share in their businesses as wounded competitors have pulled back and companies like Bear Sterns and Lehman Brothers no longer exist. They're good investments for long-term shareholders because these companies are generally well managed and do provide a very important role as a greasing mechanism for the wheels of capitalism and commerce. They're an intermediary. ... We think it makes sense to invest for our shareholders in light of the uncertainty, and that's what we're doing. We're cognizant of the risk but think that there's a wide continuum of outcomes from very favorable to modestly negative, and if it's the modestly negative outcome, then we think the price adequately reflects that. ... In the very near term, there's a lot of uncertainty. Longer term, these banks have plenty of capital. The U.S. economy is going to recover. Banks tend to be a microcosm of the economies in which they operate. We think the U.S. economy will be sluggish but with a positive bias to growth over the next couple of years and that these banks will have strong earnings.


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- Dalcindo

[dalcindo]

Article - Regulators shut down banks in 5 states

By MARCY GORDON, AP Business Writer Marcy Gordon, Ap Business

(Source: http://news.yahoo.com/s/ap/20100130/ap_on_bi_ge/us_bank_closures;_ylt=AtKb2DbI2VmNZvZfMMUoupqs0NUE;_ylu=X3oDMTNra3QwNGN0BGFzc2V0A2FwLzIwMTAwMTMwL3VzX2JhbmtfY2xvc3VyZXMEY2NvZGUDbW9zdHBvcHVsYXIEY3BvcwM1BHBvcwMyBHB0A2hvbWVfY29rZQRzZWMDeW5faGVhZGxpbmVfbGlzdARzbGsDcmVndWxhdG9yc3No )

Writer Fri Jan 29, 10:48 pm ET

WASHINGTON – Regulators shut down a big bank in California on Friday, along with two banks in Georgia and one each in Florida, Minnesota and Washington. That brought to 15 the number of bank failures so far in 2010 atop the 140 shuttered last year in the punishing economic climate.

The failure of Los Angeles-based First Regional Bank, with nearly $2.2 billion in assets and $1.9 billion in deposits, is expected to cost the federal deposit insurance fund $825.5 million.

The Federal Deposit Insurance Corp. took over the bank as well as the others: First National Bank of Georgia, based in Carrollton, Ga., with $832.6 million in assets and $757.9 million in deposits and Community Bank and Trust of Cornelia, Ga., with $1.2 billion in assets and $1.1 billion in deposits; Florida Community Bank of Immokalee, Fla., with $875.5 million in assets and $795.5 million in deposits; Marshall Bank of Hallock, Minn., with $59.9 million in assets and $54.7 million in deposits; and American Marine Bank of Bainbridge Island, Wash., with $373.2 million in assets and $308.5 million in deposits.

First Regional Bank's collapse followed the shutdown of several large California banks in the last months of 2009. California was one of the states hardest hit by the real estate market meltdown, and many banks there have suffered under the weight of soured mortgage loans. Last year saw the failure of 17 banks in the state.

First-Citizens Bank & Trust Co., based in Raleigh, N.C., agreed to buy the deposits and $2.17 billion of the assets of First Regional Bank. The FDIC retained the remaining assets for later sale. In addition, the FDIC and First-Citizens agreed to share losses on $2 billion of the failed bank's loans and other assets.

Community & Southern Bank, also based in Carrollton, Ga., agreed to assume the deposits and assets of First National Bank of Georgia.

SCBT, a national bank based in Orangeburg, S.C., is assuming the assets and deposits of Community Bank and Trust. United Valley Bank, based in Cavalier, N.D., is buying the assets and deposits of Marshall Bank.

Miami-based Premier American Bank, N.A., a new bank with a national charter set up last week, is buying the deposits and $499.1 million of the assets of Florida Community Bank. The FDIC will retain the remaining assets for later sale. In addition, the FDIC and Premier American Bank — owned by the investment firm Bond Street Holdings — agreed to share losses on $305.4 million of Florida Community Bank's loans and other assets.

Columbia State Bank, based in Tacoma, Wash., is assuming the assets and deposits of American Marine Bank.

The two shuttered banks in Georgia followed 25 bank failures there last year, more than in any other state.

The government's resolution of First National Bank of Georgia is expected to cost the deposit insurance fund $260.4 million. That of Community Bank and Trust is estimated to cost $354.5 million. Florida Community Bank's resolution is expected to cost the fund $352.6 million and Marshall Bank is expected to cost $4.1 million. The hit to the fund from American Marine Bank is estimated at $58.9 million.

As the economy has soured, with unemployment rising, home prices tumbling and loan defaults soaring, bank failures have accelerated and sapped billions out of the federal deposit insurance fund. It fell into the red last year.

The 140 bank failures last year were the highest annual tally since 1992, at the height of the savings and loan crisis. They cost the insurance fund more than $30 billion. There were 25 bank failures in 2008 and just three in 2007.

The number of bank failures is expected to rise further this year. The FDIC expects the cost of resolving failed banks to grow to about $100 billion over the next four years.

The agency last year mandated banks to prepay about $45 billion in premiums, for 2010 through 2012, to replenish the insurance fund.

Depositors' money — insured up to $250,000 per account — is not at risk, with the FDIC backed by the government. Besides the fund, the FDIC has about $21 billion in cash available in reserve to cover losses at failed banks.

Banks have been especially hurt by failed real estate loans, both residential and commercial. Banks that had lent to seemingly solid businesses are suffering losses as buildings sit vacant. As development projects collapse, builders are defaulting on their loans.

If the economic recovery falters, defaults on the high-risk loans could spike. Many regional banks hold large concentrations of these loans. Nearly $500 billion in commercial real estate loans are expected to come due annually over the next few years.

In his State of the Union address this week, President Barack Obama said he will initiate a $30 billion program to provide money to community banks at low rates, if they boost lending to small businesses. The money would come from balances left in the $700 billion bailout fund.

Hundreds of banks, including major Wall Street institutions, received taxpayer support through that politically unpopular rescue program, enacted by Congress in October 2008 at the height of the financial crisis.

Copyright © 2010 Yahoo! Inc. All rights reserved.Questions or CommentsPrivacy PolicyAbout Our AdsTerms of ServiceCopyright/IP Policy

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DAA

[dalcindo]

Re: Dow Jones US Financial Index vs. SPX:

When measured against SPX, the financials have not faired very well since early 2007.

In the relative strength chart below, wherein the Financial Index is expressed in relative strength against SPX, the shear decline in the financials represents a strong bearish move that preceded any recessionary alarms. In fact, one could say that the financials have underperformed the SPX for more than half of the past decade.

The abyssmal decline stopped and prices rallied as of last MARCH 2009 - the point at which the world markets speculated about the possibility of a sustained rally into a bullish blue azur sky ... but, the clouds have since moved in and the forecast is grimmer as of this past week.

Technically, the rally that lifted most stocks since MARCH 2009 represents a SHALLOW retracement, whereby this relative strength chart keeps the value within the 23.6 and 38.2% Fibonacci ranges. Considering the dominant downtrend and overhead resistance at the 0.26 relative strength value, here intuition favors the bears.

Of note, the positive divergence that formed in RSI may have reached the end of its technical utility as more resistance signals are emerging in this leading indicator. In fact, RSI seems to struggle to cross over the psychological 50-line - indicating a ratio of buyers and sellers uncommitted towards any further rally.

Look for the 89-WEEKLY EMA for breakout, as this Fibonacci-valued EMA may provide the first inkling whether a further rally is a fathomable scenario in this growingly bearish environment.

Have a great week-end.

- Dalcindo

PS: More indices and charting analysis here: http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID2140281 .



- Dalcindo

[dalcindo]

Chart of the Day:

(Source: http://www.chartoftheday.com/20100129.htm?T )

The stock market has been rallying over the past 10 months. So, is the stock market performing well? It all depends on how you measure. When measured in US dollars, the Dow currently trades approximately 29% below its all-time record high. However, when measured with that other world currency (gold), the picture is even more bleak. To help illustrate the point, today's chart presents the Dow divided by the price of one ounce of gold. This results in what is referred to as the Dow / gold ratio or the cost of the Dow in ounces of gold. For example, it currently takes 9.3 ounces of gold to “buy the Dow.” This is considerably less that the 44.8 ounces back in the year 1999. When priced in gold, the US stock market has been in a bear market for the entire 21st century.



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- Dalcindo

[dalcindo]

Weekly Scans - Week of 01 FEB 2010:

This week's catch is thinned out by declining markets ... So, take your pick: only two fishes left in the pond.


Bucking Bull:
Count: 0


Bull Pop:
HDVY Health Discovery Corp. NASD
Count: 1


ROW x STO:
RGBL RG Global Lifestyles Inc. NASD
Count: 1


Have a great trading week!!!

- Dalcindo


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A QUICK note on the scans:
- Bucking Bull scans for bullish trend reversals that "buck" the trend;
- Bull Pop looks for unusual "pops" in priorly bearish trending stocks;
- ROW x STO screens out positively divergent stocks over weeks (The name merely stands for: RSI Over Weeks cross-reference against weekly Slow Stochastics).

DISCLAIMER:
I chose to scan stocks only at the close of each trading week, assuming that stocks that continue bullishly into the week-end are likely to remain in the trend. Therefore, although these scans occur at the close of the trading week, their bullish activities might have been underway several days prior.

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DAA

[dalcindo]

Re: QQQQ, QCOM

QCOM is definitely pulling its weight ... DOWN.

Looking at support from bullish channel's lower border:


BDH: Broadband Holders - 12-Mo., Daily Chart:


- Dalcindo

[dalcindo]

Re: SPX & Major Indices, USD, VIX, and Direxion's ETFs:

Hi, Lang!

How have you been?!?

Indeed, SPX is testing its support, and I imagine that the trend is likely to continue. I estimated 1045 for support per first chart below.

As far as the EUR/USD pair: Great day today with a definite shift of risk adverse crowds backing up the Almighty green.

Once the pair's value readjust (i.e.; purges itself of relative overvaluation from risky exposures outside of the USD), we might see the USD come back in sync with the SPX.

For now, I am establishing a support at 1.3800 for the pair, using the Fiby levels from MAR 2009 LOW and NOV 2009 HIGH.

VIX still has plenty of room to go:











[chart][/chart]stockcharts.com/c-sc/sc?s=$SPX&p=D&yr=1&mn=0&dy=0&i=p05393902085&a=172330527&r=352







- Dalcindo