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Momentum bars have turned down. I think we retrace to where the momentum peak occurred. Then the 5 up to finish the Bull.
I think this is the blowoff stage of the cyclical bull. I count 3 waves up off the Oct. bottom, with this 3rd possibly complete Wed. judging by late day dump.
A shallow corrective 4, then 5 up to the Dec. 02 high of 1734. We have not hit the rising tops line yet which gives strength to the notion of more up after a pullback. If your higher target of above 1750 comes to pass it could be an overshoot of the rising tops trendline to take out the bears and get the bulls really frothed up. It kind of seems likely the way markets tend to get everybody wrong leaning before the kaboom.
Non Confirmations
AAII Sentiment Ratio
Specialist short position.
Feel like I'm beating a broken drum.
Diagnostic of a perfect equilateral convergent trapezoidal rhomboid. (what's the matter, don't remember your plain geometry? LoL.) Quote dr. joe. Link in follow up post.
I don't think we're going to see much more short covering/converted to longs from the large and small specs. The majority of those positions already closed. Commercials are net short after being 74% long at the bottom and could be a growing headwind.
It's going to take more real buying to compensate for the loss of short covering gains.
Yep, one could probably find better spots to go long.
LOL Tea. That guy has put up some good work.
Very low equity put/call?
And total put/call
Cot Chart. looks like the hedge funds (large specs) are the ones driving the rally. They've been feverishly covering shorts.
And here. Not to worry as long as the rising tops line acts as resistance. Business as usual with a return to the lower line next. RSI 14 at 70 not common and has been a good sell signal on this chart.
Ndx almost surely hits that upper line next week and then a multi month decline.
Busy week Odie. 60 Hour work week, but tomorrow is last 10 of it.
Naz higher than Aug top but new highs minus new lows half what it was then. Seems likely that new lows will overwhelm new highs when the correction starts.
My personal opinion is we could be seeing the blow off top of the cycle.
Very reliable 4 year cycle is due to bottom next year.
Like $NAHL below zero. Ditto $NYHL. This is the type rally I would expect to see going into a cyclical top.
Human bird flu in China, one dead.
BEIJING, China (CNN) -- The World Health Organization confirmed two human cases of bird flu in China, including a female poultry worker who died from the H5N1 strain of avian influenza.
China's Ministry of Health has confirmed three human cases -- two in central China's Hunan Province and one in east China's Anhui Province -- according to the state-run Xinhua news agency.
But WHO spokesman Dick Thompson said the organization does not have enough samples to confirm if a 12-year-old girl who died on October 17 contracted the virus because she was cremated.
Thompson said the two confirmed cases include the girl's 9-year-old brother, who fell ill last month in Hunan but survived and a 24-year-old female poultry worker in Anhui who died from the virus November 10.
China has reported 11 outbreaks in chickens and ducks over the past month nationwide, prompting authorities to destroy millions of birds in an effort to contain the virus. The government also announced an ambitious effort Tuesday to vaccinate all the country's more than 14 billion farm birds.
Experts are especially worried about the potential for bird flu to spread and mutate in China because of its vast poultry flocks and their close contact with people. It also is a major migration route for wild fowl, which experts say might be spreading the virus.
Xinhua did not elaborate on the human cases. Chinese officials initially said the girl, her brother and a schoolteacher who all fell ill had tested negative for bird flu. But the government reopened the investigation and asked WHO for assistance.
WHO experts traveled to Hunan this week.
The government had not previously disclosed there were any suspected human cases in Anhui, where an October 20 outbreak in the city of Tiancheng killed about 550 birds.
Experts also are testing a poultry worker who fell ill in the northeastern province of Liaoning, which has suffered four outbreaks. All farm birds in the province were ordered vaccinated early this month, said Fu Jingwu, deputy director of the provincial Animal Health Supervision and Management Bureau.
He said the effort covered 320 million birds. The province also has destroyed more than 15 million chickens, ducks and other birds.
Also Wednesday, the State Council, which is China's Cabinet, discussed enacting regulations on bird flu prevention, epidemic monitoring and emergency contingency plans, state television said.
The council also said it would offer tax breaks and subsidies to help counter the effects of bird flu outbreaks.
Avian influenza has spread rapidly among birds, first in Southeast Asia and more recently in Europe, however human cases have only been reported in Asia.
More than 125 people have been infected with the H5N1 avian flu strain in Indonesia, Thailand, Vietnam and Cambodia, according to the Centers of Disease Control. About half of those have died.
Earlier this month, United Nations Secretary-General Kofi Annan called on the international community to make immediate preparations for a possible pandemic of bird flu.
While it is not yet clear if the H5N1 strain will ever gain the ability to infect large numbers of people, Annan said world leaders cannot ignore the threat it poses.
The first cases of avian influenza passed from birds to humans was H5N1 in 1997 in Hong Kong. Eighteen people were infected, and six people died -- though the outbreak was limited to Hong Kong.
To control the outbreak, authorities killed about 1.5 million chickens in the Special Adminstrative Region to remove the source of the virus.
http://www.cnn.com/2005/HEALTH/conditions/11/16/bird.flu.china/
Investors Are in for a Shock
Financial assets are richly priced. That means returns are likely to be far worse than most people expect.
http://www.fortune.com/fortune/investing/articles/0,15114,1129438,00.html?promoid=cnnmoney
Ytd 15.66%. I would think there will be opportunities this week. Thinking hard dip Wed.
Poor breadth. Narrowing participation in rallies cannot be considered positive. I think this is what happens leading up to a cyclical top.
So far this rally is unlike the last two runs to 2200.
VTO also reports 5 day RSI's very overbought at 80.9 Indu, 81.1 Spx, and 84.2 Comp.
Markets amaze me. Can't givem away at the Oct. low and 150 points higher they can't get enough. LOL.
Sentiment is such that nobody wants to hear about any negative divergances. Only the exuberance of the forthcoming moonshot.
LOL $SML stocks are hand picked. Secondly they're Cap weighted. It's too early to tell whether small cap outperformance is done. I'll just say the Rut has lost it's leadership vs. the Spx since the Aug. top. That is undeniable.
http://stockcharts.com/def/servlet/SC.web?c=$RUT:$SPX,uu[w,a]dallyyay[dc][p][vc60]&pref=G
Composition
The S&P SmallCap 600 Index consists of 600 small-cap stocks. Unlike the larger Russell 2000, which also tracks small-cap stocks, the S&P 600 has more stringent requirements for inclusion. Standard & Poor's adds new stocks to the index based not only on size, but also on financial viability, liquidity, adequate float size, and other trading requirements. This ensures that the index is comprised of higher-quality firms than its larger counterpart. Since the index contains only small firms, it represents a mere 3% of the value of the overall market. The S&P SmallCap 600 Index is market value weighted, meaning that larger firms have a greater influence on the index's performance than smaller firms. The index is relatively evenly distributed, as the top 10 holdings represent only 5% of the index’s value. The index's current holdings range in size from $60 million to over $3 billion, with the average company boasting a market cap of around $750 million. http://www.streetauthority.com/terms/index/sp600.asp
Nothing bullish about narrowing breadth, that is a negative divergance. Yet, as in 99 some stocks can continue to rise as the majority do not or even fall.
The late cycle sectors of Energy and Utilities have given up their leadership role. Small caps have also lost their leadership.
http://stockcharts.com/def/servlet/SC.web?c=$rut:$spx,uu[w,a]dallyyay[dc][pd20,2!h.02,.20][vc60][iUb...
Looking to me like the cyclical top is very near.
NAA50R should be closer to 70 as it was the last time Nasdaq was at 2200. A negative divergance.
A few stocks carrying the others.
$Nahl showing a negative divergance.
Narrow rally. % of Nasdaq Stocks above 50dma not keeping pace with price.
http://stockcharts.com/def/servlet/SC.web?c=$NAA50R,uu[w,a]daclyyay[dd][pb50!b200][vc60][iUb14!La12,...
NAA200R. % of stocks participating in rallies diminishing on each test of 2200.
http://stockcharts.com/def/servlet/SC.web?c=$NAA200R,uu[m,a]daclyyay[df][pb50!b200][vc60][iUb14!La12...
We must have a mis-communication. 1734 Ndx is a mere 5% from here, and represents the rising tops trendline.
Taking out that resistance would signify a new, stronger uptrend.
Curiously, what are you talking about w/5000 and 1500?
Rising tops/lateral resistance at 1734 next hurdle. I don't think it gets above that and may well mark a cyclical top. A bust above that line means that I am and have been very wrong on the secular bear market.
Been seeing alot of that piss poor 06 stuff that the market is not noticing....yet.
Promising candle. The tail tells the story.
Switching to full short. Opex dump on the way and volume/momo waning.
Capital preservation.
If there's an immediate retracement I think the Ndx falls more than the Spx and I profit.
If the top is blown off I limit my losses.
Tough tape to be short and unhedged.
Worked today anyhow, for a net gain of .38%
Hedging off 50/50 long Spx, short Ndx. Futes and Europe showing tendency to weakness. Outta here for the day.
Not just Katrina: Job weakness spreading
Payrolls grow after September's decline but the gains are disappointing; jobless rate eases to 5%.
November 4, 2005: 12:56 PM EST
By Chris Isidore, CNN/Money senior writer
NEW YORK (CNN/Money) - Job growth resumed in October but came in well below economists' forecasts, due to softness in the labor market nationwide, rather than disruptions from Hurricane Katrina.
Employers added 56,000 to payrolls last month compared with a revised loss of 8,000 jobs in September, the Labor Department reported. Economists surveyed by Briefing.com were looking for 100,000 new jobs. The decline in September was the first drop in payrolls in more than two years.
The unemployment rate edged down to 5 percent from 5.1 percent in September, in part because a large number of people weren't counted as part of the labor force after the storms.
Kathleen Utgoff, the commissioner of the Bureau of Labor Statistics, said in a statement that while September's job losses were Katrina-related, the October weakness was due to softness in the labor market outside the storm-affected regions.
"Job growth in the remainder of the country appeared to be below trend in October," she said in comments prepared for an appearance before the Joint Economic Committee of Congress. She suggested the jump in energy prices after Katrina may have crimped hiring plans.
The unemployment rate among the estimated half million people still displaced by hurricanes was 33 percent last month, the department said. The rate among evacuees able to return home was 10.5 percent. The survey did not include evacuees still living in shelters or hotels.
Even with the disappointing gain in payrolls, a look at September and October combined show that the labor market has weathered recent shocks fairly well, said Anthony Chan, senior economist at JPMorgan Asset Management.
"When we exclude the effects of the recent hurricanes, we have to come away with the conclusion that despite higher energy prices and a battery of hurricanes, the job market is not doing all that bad," said Chan.
There was some positive impact from the hurricanes, though. Construction employment rose by 33,000 in the month, at least partly due to reconstruction efforts, according to Utgoff.
One concern for economists and investors, and a hope for the nation's workers, is that the report showed average hourly wage rose 8 cents, or 0.5 percent, to $16.27 in October.
That's far bigger than the 0.2 percent rise forecast by economists, and it put the average hourly wage up 2.9 percent in the last 12 months. That could feed investor concerns about inflationary pressure, even with the below-trend employment gain.
"We may want to wait for another month or so to be sure that such gains were truly reflective of a upward trend and not just a possible distortion arising from the temporary 'hurricane-related' loss of many lower-paying service sector jobs," cautioned Chan.
Still, employees apparently aren't keeping up with inflation. A jump in gasoline prices has lifted the overall Consumer Price Index, the government's key inflation index, up 4.7 percent over the 12 months ending in September.
http://money.cnn.com/2005/11/04/news/economy/jobs_october/index.htm
Being right at resistance the Ndx price should be repelled again (until it isn't). A short addition tommorrow may be in the cards.
At this point I'm looking to get my average price above the bottom of the gap as much as possible. That's one gap that's going to be filled before any possible b/o. Of course, IMO.
Yeah, then we'll worry the initial break was a headfake, LOL.