Saturday, February 27, 2010
Thursday, February 25, 2010
Housing prices- More down predicted
Despite signs that the real estate market might be lurching forward, prices are expected to fall further this year and next.
The average home price in the United States will fall by about 6% by September 2011, according to a joint report between Fiserv and Moody's Economy.com. And that's after plunging more than 27% in the past three years.
Most of the projected home price decline will occur during the usually slow summer months of 2010. After that, prices should begin to stabilize, according to Fiserv, and stay almost flat through fall of 2011.
The main reason for continued decline, according to Mark Zandi, economist and co-founder of Economy.com, is foreclosures -- the same thing that's plagued markets for the past three years.
"Foreclosure sales will pick up this spring as mortgage servicers figure out who can qualify for a modification and who can't," said Zandi.
He figures there are at least 4.5 million mortgage loans either in foreclosure or clearly headed in that direction. When that additional inventory hits the market, it will provide numerous choices for buyers and encourage sellers to drop their listing prices.
The end of two federal programs, which have been propping up markets, will also tamp down prices.
The Federal Reserve has been purchasing mortgage-backed securities since early 2009, scooping up as much as $1.25 trillion worth. That has dampened rate increases by providing a ready market for the securities. But the Fed's program lapses on March 31, when it cedes the playing field to private investors, who will almost surely demand higher rates.
Any resulting rise in rates will cause some buyers to withdraw from the market and others to look for lower priced homes. Either way, demand for homes drops and so do prices.
A month after the Fed bows out of the mortgage-buying market, the homebuyer tax credit will start to expire. To qualify for the $8,000 credit, homebuyers must sign a contract before April 30 and close by June 30. When the first date passes, many buyers are expected to vacate the market, weakening the demand for homes.
In a broader sense, home prices are ultimately decided by employment. "If [the job market] improvement is stronger than expected, prices will get better. If it's weaker than expected, prices will be worse," Zandi said.
Worst of the worst
The worst performing market will be Miami, Fla. Moody's projects prices there to drop a heart-stopping 29.2% by Sept. 30. That follows a 47.7% decline the metro area recorded in the past three years. Grand total: 64% drop.
Other disastrous performances will be turned in by the Hanford, Calif., metro area, where prices are projected to plummet 27.2% through Sept. 30, 2010 following their 36.9% drop for the previous 36 months. Ft. Lauderdale and West Palm will also register steep drops.
There's some good price news coming out of California's Central Valley for a change; prices will begin to emerge from their free fall toward the end of this year.
In Merced, for example, which crashed and burned by 71.8% in the past three years (through last September), they'll only fall only another 6.2% in the next six months before bouncing back with a rise of 10.1% by Sept. 30, 2011.
The average home price in the United States will fall by about 6% by September 2011, according to a joint report between Fiserv and Moody's Economy.com. And that's after plunging more than 27% in the past three years.
Most of the projected home price decline will occur during the usually slow summer months of 2010. After that, prices should begin to stabilize, according to Fiserv, and stay almost flat through fall of 2011.
The main reason for continued decline, according to Mark Zandi, economist and co-founder of Economy.com, is foreclosures -- the same thing that's plagued markets for the past three years.
"Foreclosure sales will pick up this spring as mortgage servicers figure out who can qualify for a modification and who can't," said Zandi.
He figures there are at least 4.5 million mortgage loans either in foreclosure or clearly headed in that direction. When that additional inventory hits the market, it will provide numerous choices for buyers and encourage sellers to drop their listing prices.
The end of two federal programs, which have been propping up markets, will also tamp down prices.
The Federal Reserve has been purchasing mortgage-backed securities since early 2009, scooping up as much as $1.25 trillion worth. That has dampened rate increases by providing a ready market for the securities. But the Fed's program lapses on March 31, when it cedes the playing field to private investors, who will almost surely demand higher rates.
Any resulting rise in rates will cause some buyers to withdraw from the market and others to look for lower priced homes. Either way, demand for homes drops and so do prices.
A month after the Fed bows out of the mortgage-buying market, the homebuyer tax credit will start to expire. To qualify for the $8,000 credit, homebuyers must sign a contract before April 30 and close by June 30. When the first date passes, many buyers are expected to vacate the market, weakening the demand for homes.
In a broader sense, home prices are ultimately decided by employment. "If [the job market] improvement is stronger than expected, prices will get better. If it's weaker than expected, prices will be worse," Zandi said.
Worst of the worst
The worst performing market will be Miami, Fla. Moody's projects prices there to drop a heart-stopping 29.2% by Sept. 30. That follows a 47.7% decline the metro area recorded in the past three years. Grand total: 64% drop.
Other disastrous performances will be turned in by the Hanford, Calif., metro area, where prices are projected to plummet 27.2% through Sept. 30, 2010 following their 36.9% drop for the previous 36 months. Ft. Lauderdale and West Palm will also register steep drops.
There's some good price news coming out of California's Central Valley for a change; prices will begin to emerge from their free fall toward the end of this year.
In Merced, for example, which crashed and burned by 71.8% in the past three years (through last September), they'll only fall only another 6.2% in the next six months before bouncing back with a rise of 10.1% by Sept. 30, 2011.
See-Saw
See Sawing week to week. We are down 160 point after just 15 minutes of trading and I am just waiting for a break either way to take advantage. Though you know I am a medium term bear that does not been we don't play on the long side in the shorter term, problem here is we are in such a narrow range it is best to stay neutral till be get a firm break.
Last year I stressed on this phenomenon could happen of a longer term narrow range bound market, I personally think this is just a preview of what we will see longer term.
Last year I stressed on this phenomenon could happen of a longer term narrow range bound market, I personally think this is just a preview of what we will see longer term.
Wednesday, February 24, 2010
Unbelievable: But not surprised
WASHINGTON (AP) -- Federal regulators on Wednesday imposed new curbs on the practice of short-selling, hoping to prevent spiraling sales sprees in a stock that can stoke market turmoil.
The Securities and Exchange Commission, divided along party lines, voted 3-2 at a public meeting to adopt new rules.
The rules put in a so-called circuit breaker for stock prices, restricting for the rest of a trading session and the next one any short-selling of a stock that has dropped 10 percent or more.
Short-sellers bet against a stock, in a practice that is legal and widely used on Wall Street. They borrow a company's shares, sell them and then buy them when the stock falls and return them to the lender -- pocketing the difference in price.
The SEC move followed months of wrestling with the controversial issue. The SEC asked for public comment last April on several alternative approaches to restraining short-selling, and a bipartisan group of senators have been pushing the agency to act or face legislation.
The agency got more than 4,300 comments on the issue.
Investor confidence was shaken as the market plunged amid the financial crisis in the fall of 2008, and proponents of restoring restraints said they were needed to prevent abusive trading. They maintained that the absence of restraints fanned market volatility, prompting hedge funds and other aggressive investors to target weak companies with an avalanche of short-selling.
But opponents said new restrictions could eliminate the benefits of short-selling -- bringing capital into the markets and accurate stock prices to the surface -- and actually hurt investor confidence.
Under the new rule, once a "circuit breaker" has been triggered, short-selling in the affected stock will be permitted only if the price is above the current highest bid for the stock. That restriction would apply for the rest of the trading session and the next day's session.
The SEC said the rule strikes a balance between two objectives: preventing short sellers from driving the price of a gutted stock even lower and preserving the benefits to investors from legitimate short-selling, such as pumping cash into the market. The balance comes, the agency said, because the "circuit breaker" restrictions are temporary and are applied to a specific trading session, in contrast to other alternatives that would institute permanent constraints.
"The reason this rule makes sense is because it recognizes that short-selling can potentially have both a beneficial and a harmful impact on the market -- depending on the circumstances," SEC Chairman Mary Schapiro said before the vote.
Schapiro said it is important for the SEC and the markets "to have in place a measure that creates certainty about how trading restrictions will operate during periods of stress and volatility."
But the two Republican commissioners, Kathleen Casey and Troy Paredes, disputed that the curbs would bolster investor confidence and said they could hurt the market's efficiency.
Casey said she was "deeply concerned" that the action seemed to be guided more by "public relations" than evidence of the benefit of the rules. It could "undermine our credibility in the long run," she said.
In July 2007, when the stock market was near its peak, the SEC abolished a 70-year-old uptick rule, put in during the Depression that followed the 1929 market crash that allowed short-sellers to come in only at a price above the highest current bid for the stock.
Last July, the SEC made permanent an emergency rule enacted at the height of the fall 2008 tumult that targets so-called "naked" short-selling -- when sellers don't even borrow the shares before selling them, and look to cover positions after the sale.
That rule includes a requirement that brokers must promptly buy or borrow securities to deliver on a short sale.
Brokers acting for short-sellers must find a party believed to be able to deliver the shares within three days after the short-sale trade. If the shares aren't delivered within that time, there is deemed to be a "failure to deliver." Brokers can be subject to penalties if the failure to deliver isn't resolved by the start of trading on the following day.
The Securities and Exchange Commission, divided along party lines, voted 3-2 at a public meeting to adopt new rules.
The rules put in a so-called circuit breaker for stock prices, restricting for the rest of a trading session and the next one any short-selling of a stock that has dropped 10 percent or more.
Short-sellers bet against a stock, in a practice that is legal and widely used on Wall Street. They borrow a company's shares, sell them and then buy them when the stock falls and return them to the lender -- pocketing the difference in price.
The SEC move followed months of wrestling with the controversial issue. The SEC asked for public comment last April on several alternative approaches to restraining short-selling, and a bipartisan group of senators have been pushing the agency to act or face legislation.
The agency got more than 4,300 comments on the issue.
Investor confidence was shaken as the market plunged amid the financial crisis in the fall of 2008, and proponents of restoring restraints said they were needed to prevent abusive trading. They maintained that the absence of restraints fanned market volatility, prompting hedge funds and other aggressive investors to target weak companies with an avalanche of short-selling.
But opponents said new restrictions could eliminate the benefits of short-selling -- bringing capital into the markets and accurate stock prices to the surface -- and actually hurt investor confidence.
Under the new rule, once a "circuit breaker" has been triggered, short-selling in the affected stock will be permitted only if the price is above the current highest bid for the stock. That restriction would apply for the rest of the trading session and the next day's session.
The SEC said the rule strikes a balance between two objectives: preventing short sellers from driving the price of a gutted stock even lower and preserving the benefits to investors from legitimate short-selling, such as pumping cash into the market. The balance comes, the agency said, because the "circuit breaker" restrictions are temporary and are applied to a specific trading session, in contrast to other alternatives that would institute permanent constraints.
"The reason this rule makes sense is because it recognizes that short-selling can potentially have both a beneficial and a harmful impact on the market -- depending on the circumstances," SEC Chairman Mary Schapiro said before the vote.
Schapiro said it is important for the SEC and the markets "to have in place a measure that creates certainty about how trading restrictions will operate during periods of stress and volatility."
But the two Republican commissioners, Kathleen Casey and Troy Paredes, disputed that the curbs would bolster investor confidence and said they could hurt the market's efficiency.
Casey said she was "deeply concerned" that the action seemed to be guided more by "public relations" than evidence of the benefit of the rules. It could "undermine our credibility in the long run," she said.
In July 2007, when the stock market was near its peak, the SEC abolished a 70-year-old uptick rule, put in during the Depression that followed the 1929 market crash that allowed short-sellers to come in only at a price above the highest current bid for the stock.
Last July, the SEC made permanent an emergency rule enacted at the height of the fall 2008 tumult that targets so-called "naked" short-selling -- when sellers don't even borrow the shares before selling them, and look to cover positions after the sale.
That rule includes a requirement that brokers must promptly buy or borrow securities to deliver on a short sale.
Brokers acting for short-sellers must find a party believed to be able to deliver the shares within three days after the short-sale trade. If the shares aren't delivered within that time, there is deemed to be a "failure to deliver." Brokers can be subject to penalties if the failure to deliver isn't resolved by the start of trading on the following day.
What I Fear is happening
What I feared with the markets is happening. The continuation of the narrow range bound trading which ended 2009 continues for 2010. One thing is for sure, it won't last forever and when we do break either way it will be violent. I have my guesses but it is not prudent to guess but to wait for the break and trade as such. In the mean time it is safer to stay flat.
Tuesday, February 23, 2010
Monday, February 22, 2010
Last week
The surprise rate hike Thursday afternoon was good for an after hours trade down, but when the Friday's day session came, the market shook off the weakness, and finished the week with it's fourth straight up day. Option expiration was used as the excuse, but whatever the reason, the weakness was used as a buying opportunity.
As the chart above shows, we are now at a decision level for the S&P 500. Friday's trade smacked into the 62% Fibonacci retracement of the swing down from the high to low so far for 2010. If this retracement level does not hold as resistance, the next level up is the 78.6% Fib at 1128 (rounded up).
On the short term, we are overbought, and should watch for at least a mild pullback here, keeping in mind that the down move that started back in late January could be approaching its next leg. I'll be watching a gap up for a shorting op, then move to the first 30 and 60 minute brackets to watch for trend confirmation
Friday, February 19, 2010
Rate hike
It will be interested what will be said over the weekend with this surprise in the interest rate. Well it was not a surprise to me I mean how long are we going to be in a low interest rate environment without creating another bubble.
Oil on the move wow, I really guess I was spot on saying $71 area should be a bounce.
I have been programming all week and have gone to bed extremely late in the morning hours, so I am very slow to thaw in the mornings but nothing seems exciting here so let just watch the effects of the rate adjustment.
Oil on the move wow, I really guess I was spot on saying $71 area should be a bounce.
I have been programming all week and have gone to bed extremely late in the morning hours, so I am very slow to thaw in the mornings but nothing seems exciting here so let just watch the effects of the rate adjustment.
Thursday, February 18, 2010
Important news after the close
WASHINGTON (AP) -- The Federal Reserve decided Thursday to boost the rate banks pay for emergency loans. The action is part of a broader move to pull back the extraordinary aid it provided to fight the financial crisis.
The action won't directly affect borrowing costs for millions of Americans. But with the worst of the crisis over, it brings the Fed's main crisis lending program closer to normal.
The Fed chose to bump up the so-called "discount" lending rate by one-quarter point to 0.75 percent. It takes effect Friday.
The central bank said the step should not be seen as a signal that it will soon boost interest rates for consumers and businesses. It repeated its pledge to keep such rates at record-low levels for an "extended period" to foster the economic recovery.
The Fed had signaled for weeks that a higher discount rate was coming, though the timing of Thursday's decision caught some by surprise. It portrayed its action as moving its emergency program for banks closer to normal.
The announcement came after the financial markets had closed. Investors saw it initially as a prelude to higher borrowing costs across the board. In after-hours trading, the dollar strengthened on the expectation of higher rates. Yields on two-year Treasury securities rose, and stock futures dipped.
After the sell-off in stock futures, Pimco Managing Director Bill Gross warned investors not to overreact.
"I'd accept the Fed at its word -- that this isn't a change in monetary policy or in the timing of it," he said. "Calmer heads may prevail tomorrow."
T.J. Marta, a market strategist, said he thinks higher rates for American borrowers are still months away. But "I think one man's normalization is another man's tightening," he said of investors' initial anxiety.
The Fed has kept the target range for its main interest rate -- the federal funds rate -- at between zero and 0.25 percent since December 2008.
After the Fed's action Thursday, economists said they still believe it won't start to boost borrowing costs for Americans until later this year. Some don't think it will happen until next year, given the fragile recovery.
Chairman Ben Bernanke last week signaled the Fed is in no rush to boost rates.
When the time does come, Bernanke said the Fed will likely start to tighten credit by raising the rate it pays banks on money they leave at the central bank. Doing so would raise rates tied to commercial banks' prime rate and affect many consumer loans. That would mark a shift away from the federal funds rate, its main lever since the 1980s.
Steering interest rates through the excess reserves rate, now at 0.25 percent, gives the Fed more control over money floating around the financial system. The Fed sets that rate directly; its funds rate is just a target.
James Paulsen, chief investment strategist at Wells Capital Management, saw the Fed's move Thursday as testament to an improving economy.
"This may be the bell ringing that the crisis is over," Paulsen said.
The big question over the next few days is whether investors will start selling Treasurys with maturities of two years or less, Paulsen said. Doing so would send yields higher. Savers would start seeing higher interest on their money market accounts.
The economy is growing again, and financial conditions have improved. But unemployment is still near double digits. And demand for loans remains weak. Many ordinary Americans and small businesses have found it difficult to borrow.
When credit virtually shut down starting in 2008, banks that wanted to borrow had nowhere to go except the Fed. Banks can now more easily tap private lending sources. As a result, the Fed feels more comfortable about boosting the rate banks pay on emergency loans.
Because conditions have improved, the Fed also said it will shorten the length of loans drawn from its emergency lending program. It will return to the historical norm of overnight loans, effective March 18. During the crisis, the Fed had lengthened the loans to 30 days.
Earlier this month, the Fed shut down a handful of programs to help banks and other companies access credit. Like those shutdowns, the action Thursday is "intended as a further normalization of the Federal Reserve's lending facilities," the Fed said.
"The modifications are not expected to lead to tighter financial conditions for households and businesses and do not signal any change in the outlook for the economy or monetary policy," the Fed said.
Banks have scaled back their use of the Fed's emergency "discount" loan window as conditions have improved.
At the peak of the crisis in the fall of 2008, daily borrowing from the discount window reached $110 billion. Commercial banks averaged $14.3 billion in daily borrowing for the week that ended Wednesday, the Fed said in a report Thursday. That was down from $14.6 billion for the previous week.
Congress has demanded the Fed identify the banks that draw on the emergency loans. The Fed has resisted. Bernanke and his colleagues have argued that identifying the banks that take out emergency loans could cause a run on the institution.
Created by Congress in 1913 after a series of bank panics, the Fed acts as "lender of last resort" to banks that can't borrow elsewhere. Its actions help stabilize the financial and economic systems. And its decisions on rates affect the ability of companies and individuals to borrow and spend.
The wind-down of Fed programs earlier this month, most of which had fallen out of use, was little noticed. A bigger impact could be felt by the scheduled shut-down of the Fed's program to buy mortgage securities from Fannie Mae and Freddie Mac. That program is slated to end after March.
The purchases of mortgage securities have lowered home-loan rates and bolstered the housing market. The Fed has held the door open to extending the program if the economy weakens. Some analysts fear that once the program ends, mortgage rates could rise, hurting the recovery in housing and the overall economy. Rates on 30-year mortgages averaged 4.93 percent this week, Freddie Mac reported.
Unwinding the Fed's stimulus is the biggest challenge for Bernanke in his second term, which began Feb. 1. Moving too soon could short-circuit the recovery. Waiting too long could unleash inflation and feed a speculative asset bubble.
More insights into the Fed's strategy will likely come when Bernanke testifies on Capitol Hill next week.
David Rosenberg, chief economist at money manager Gluskin Sheff in Toronto, says the Fed's decision to bump up the emergency lending rate for banks is psychological but still packs a punch.
"The Fed is moving toward a new strategy of draining liquidity from the system," he says. "Will the Fed be raising the Fed funds rate soon? No. But what happens when it stops buying mortgages or even starts selling? That could have a material impact on mortgage rates."
AP Business Writers Bernard Condon and Tim Paradis in New York contributed to this report.
The action won't directly affect borrowing costs for millions of Americans. But with the worst of the crisis over, it brings the Fed's main crisis lending program closer to normal.
The Fed chose to bump up the so-called "discount" lending rate by one-quarter point to 0.75 percent. It takes effect Friday.
The central bank said the step should not be seen as a signal that it will soon boost interest rates for consumers and businesses. It repeated its pledge to keep such rates at record-low levels for an "extended period" to foster the economic recovery.
The Fed had signaled for weeks that a higher discount rate was coming, though the timing of Thursday's decision caught some by surprise. It portrayed its action as moving its emergency program for banks closer to normal.
The announcement came after the financial markets had closed. Investors saw it initially as a prelude to higher borrowing costs across the board. In after-hours trading, the dollar strengthened on the expectation of higher rates. Yields on two-year Treasury securities rose, and stock futures dipped.
After the sell-off in stock futures, Pimco Managing Director Bill Gross warned investors not to overreact.
"I'd accept the Fed at its word -- that this isn't a change in monetary policy or in the timing of it," he said. "Calmer heads may prevail tomorrow."
T.J. Marta, a market strategist, said he thinks higher rates for American borrowers are still months away. But "I think one man's normalization is another man's tightening," he said of investors' initial anxiety.
The Fed has kept the target range for its main interest rate -- the federal funds rate -- at between zero and 0.25 percent since December 2008.
After the Fed's action Thursday, economists said they still believe it won't start to boost borrowing costs for Americans until later this year. Some don't think it will happen until next year, given the fragile recovery.
Chairman Ben Bernanke last week signaled the Fed is in no rush to boost rates.
When the time does come, Bernanke said the Fed will likely start to tighten credit by raising the rate it pays banks on money they leave at the central bank. Doing so would raise rates tied to commercial banks' prime rate and affect many consumer loans. That would mark a shift away from the federal funds rate, its main lever since the 1980s.
Steering interest rates through the excess reserves rate, now at 0.25 percent, gives the Fed more control over money floating around the financial system. The Fed sets that rate directly; its funds rate is just a target.
James Paulsen, chief investment strategist at Wells Capital Management, saw the Fed's move Thursday as testament to an improving economy.
"This may be the bell ringing that the crisis is over," Paulsen said.
The big question over the next few days is whether investors will start selling Treasurys with maturities of two years or less, Paulsen said. Doing so would send yields higher. Savers would start seeing higher interest on their money market accounts.
The economy is growing again, and financial conditions have improved. But unemployment is still near double digits. And demand for loans remains weak. Many ordinary Americans and small businesses have found it difficult to borrow.
When credit virtually shut down starting in 2008, banks that wanted to borrow had nowhere to go except the Fed. Banks can now more easily tap private lending sources. As a result, the Fed feels more comfortable about boosting the rate banks pay on emergency loans.
Because conditions have improved, the Fed also said it will shorten the length of loans drawn from its emergency lending program. It will return to the historical norm of overnight loans, effective March 18. During the crisis, the Fed had lengthened the loans to 30 days.
Earlier this month, the Fed shut down a handful of programs to help banks and other companies access credit. Like those shutdowns, the action Thursday is "intended as a further normalization of the Federal Reserve's lending facilities," the Fed said.
"The modifications are not expected to lead to tighter financial conditions for households and businesses and do not signal any change in the outlook for the economy or monetary policy," the Fed said.
Banks have scaled back their use of the Fed's emergency "discount" loan window as conditions have improved.
At the peak of the crisis in the fall of 2008, daily borrowing from the discount window reached $110 billion. Commercial banks averaged $14.3 billion in daily borrowing for the week that ended Wednesday, the Fed said in a report Thursday. That was down from $14.6 billion for the previous week.
Congress has demanded the Fed identify the banks that draw on the emergency loans. The Fed has resisted. Bernanke and his colleagues have argued that identifying the banks that take out emergency loans could cause a run on the institution.
Created by Congress in 1913 after a series of bank panics, the Fed acts as "lender of last resort" to banks that can't borrow elsewhere. Its actions help stabilize the financial and economic systems. And its decisions on rates affect the ability of companies and individuals to borrow and spend.
The wind-down of Fed programs earlier this month, most of which had fallen out of use, was little noticed. A bigger impact could be felt by the scheduled shut-down of the Fed's program to buy mortgage securities from Fannie Mae and Freddie Mac. That program is slated to end after March.
The purchases of mortgage securities have lowered home-loan rates and bolstered the housing market. The Fed has held the door open to extending the program if the economy weakens. Some analysts fear that once the program ends, mortgage rates could rise, hurting the recovery in housing and the overall economy. Rates on 30-year mortgages averaged 4.93 percent this week, Freddie Mac reported.
Unwinding the Fed's stimulus is the biggest challenge for Bernanke in his second term, which began Feb. 1. Moving too soon could short-circuit the recovery. Waiting too long could unleash inflation and feed a speculative asset bubble.
More insights into the Fed's strategy will likely come when Bernanke testifies on Capitol Hill next week.
David Rosenberg, chief economist at money manager Gluskin Sheff in Toronto, says the Fed's decision to bump up the emergency lending rate for banks is psychological but still packs a punch.
"The Fed is moving toward a new strategy of draining liquidity from the system," he says. "Will the Fed be raising the Fed funds rate soon? No. But what happens when it stops buying mortgages or even starts selling? That could have a material impact on mortgage rates."
AP Business Writers Bernard Condon and Tim Paradis in New York contributed to this report.
Thoughts
Sometimes we take health for granted. I have been suffering from sinus problems since I was a little boy but over the last few years I have seen so much death and sickness that I feel blessed I am only suffering from my sinuses.
This past weekend my best friend called me about a friend who we had in high school that is suffering from cancer and it doesn't look good. My prayers are out to them and their love ones in this time. It is good to have real good friends and I mean real good friends not people who just know you but people who are there in good and bad times for you.
One of my closest friends, brother in law was on dying bed two years ago and if you saw him today you would never believe; he is alive and well and shows no signs of being ill.
We never know what the outcome will be, no matter how dire the situation seems, so all we can do is pray and have some faith for the best for those who are suffering.
This past weekend my best friend called me about a friend who we had in high school that is suffering from cancer and it doesn't look good. My prayers are out to them and their love ones in this time. It is good to have real good friends and I mean real good friends not people who just know you but people who are there in good and bad times for you.
One of my closest friends, brother in law was on dying bed two years ago and if you saw him today you would never believe; he is alive and well and shows no signs of being ill.
We never know what the outcome will be, no matter how dire the situation seems, so all we can do is pray and have some faith for the best for those who are suffering.
Neutral
I am taking a neutral stands on the markets here- I think we are in limp mode and I am not going to guess what will happen next. We are year to date down but remember the longer they hold this level the year over year to date will start to look positive because of last year's early sell off though we are not moving here.
Better to stay put and watch multiple time frames for any clues shorter term.
Better to stay put and watch multiple time frames for any clues shorter term.
Wednesday, February 17, 2010
Short Term structure:S&P
Very possible that we working off the sell off BUT looks like we might try for higher.
Tuesday, February 16, 2010
Shorten week
With the holiday yesterday we have a shorten trading week. Usual trend is for today to be a up day when the market opens back after a 3 day weekend, so it will be kind of distorted.
Woke up this morning first day in a week without an sinus headache, hope we stays that way.
Woke up this morning first day in a week without an sinus headache, hope we stays that way.
Monday, February 15, 2010
Reading
Catching up on my reading, I stumbled upon this - WOW
http://finance.yahoo.com/banking-budgeting/article/108837/dead-cat
http://finance.yahoo.com/banking-budgeting/article/108837/dead-cat
Holiday today
Today is a holiday and boy do I need it. Still suffering from bad sinus headaches geez- below is a SPX chart of the recent bounce. Notice it is very weak.
Friday, February 12, 2010
4 hour chart
Four hour chart of the S&P, seem like we will make a dip again soon after the RSI works off the last selling. Still feel like crap and now we might be getting another batch of bad weather. Winter could you please give us a break
Thursday, February 11, 2010
Wednesday, February 10, 2010
Snow
Yep the heavy snowing in the north east has slow trading to a halt on Wall Street. News is that the trading desks are only 20% occupied so little activity.
I suspect the week is done here as the storm is expected to last for another day.
I suspect the week is done here as the storm is expected to last for another day.
Posts
Sorry for the limited posts in the last couple of days but I have been extremely busy. Basically my markers here in the market are the all important banks but I believe another leg down on them will next bring down the technology stocks like GOOG and AAPL. Keep an eye on them folks, note that BAC has broken the $15 level lower and it should break the next level 14.40 very soon also GS $150 level is important and they should give this level a good support level before it breaks down.
Now I must take note by saying , I dont think this downdraft is the ultimate down draft but I do believe the path of least resistance here is lower short term.
Stay tuned
Now I must take note by saying , I dont think this downdraft is the ultimate down draft but I do believe the path of least resistance here is lower short term.
Stay tuned
Tuesday, February 9, 2010
Oversold bounce
Definitely a oversold bounce here in the market, doesn't feel like a bounce to get higher but a bounce to short. As of mid day all I see is a turn around tuesday based on monday's action.
Sick
Hate being sick. I have no voice!!! rrrggg
Why won't winter be gone with this is killing my sinuses
Why won't winter be gone with this is killing my sinuses
Monday, February 8, 2010
Nothing new
Nothing new here- Still watching that 1039 number next and it seem like it really wants it. I was out after 2 pm today but the close didn't surprise me after this more jittery news on the financials. The next shoe should be the technology stocks, stay far from them if you are long and you should be short these.
Friday, February 5, 2010
Travel cancelled
Oh this weather looks dangerous so no travel. Well we traded down to 1050 on the S&P overnight and looks like a bouncey bouncey. The numbers for the employment look dim and I fear we will see more of the same for the next 4-6 quarters as firms are still laying off workers.
Will be watching the $ today of any signs of stability in the Euro zone.
Will be watching the $ today of any signs of stability in the Euro zone.
Thursday, February 4, 2010
shoooosh
Wow seem like I am always busy or out on the huge days. well two weeks ago I called the top one day before it happen noting all the factors were in place for this up move to end. Tomorrow I will be traveling so I wont have an eye on the market but by todays action is seems no one out there is buying and definitely getting themselves into cash.
I don't think this is the move that will take us down to 8500 area but I do think we will see lower prices here after we digest today's move.
I should be back on tuesday
I don't think this is the move that will take us down to 8500 area but I do think we will see lower prices here after we digest today's move.
I should be back on tuesday
Hmmmm
Well I have been on the phone all morning and travelling tomorrow depending on the weather but I really just realized what is sending the market down today. This might get ugly in a fast way. Look at Oil, wow.
Months ago I said Europe is in problems and it will come home to investors here and we are just seeing the tip of the problems I believe in Europe.
Months ago I said Europe is in problems and it will come home to investors here and we are just seeing the tip of the problems I believe in Europe.
Tuesday, February 2, 2010
1101
1101 is my marker for tomorrow. We have to stay above that 1101 area to be bullish. 1109 is resistance
Oil Again
Oil is on the hunt again higher. People keep on waiting for this thing to break down to the $50's but it always seem to get buying in the low 70's. Staying this higher this early in the year is bullish
Busy Busy
Busy here folks- went to bed @ 3am woke up 5am and have been on the phone for the last 3 hours without a break. Will try and look for some interesting articles and post before I post some analysis. I might be travelling thursday for a few days so update might be few.
Monday, February 1, 2010
Update on BAC
There is a lot of talk here locally about BAC moving its headquarters to Jersey in coming months. It is not surprise that the southern guys have lost their hold on their prized properties (BAC and Wachovia). Don't forget I got hate mail and malice from persons I knew when I spoke about the banking disaster many months before it happened but that's not the story here. The story is in the charts, what's next for BAC and WFC (took over Wachovia).
Here is what I am seeing: BAC is trading very weak, BAC has been trading in a contractionary range down to 14.12, up to a lower high at 17.18, and then down to lows at 14.68. Notice that the 200-day moving average is around 14.60, and the 50-day is at 15.90, hmm our trading range. What must happen for us to be long this stock is a substantial time frame above the 50day MA, which will be quite difficult therefore I hold that the opposite will happen that of a break of the 14.60 for a substantial period which 'SHOULD' trade us down to the $12 level. There is a 38 Fib number down by $12.85 area on this stock so I would be looking for that level to hold before we go into a tail spin if we do
Here is what I am seeing: BAC is trading very weak, BAC has been trading in a contractionary range down to 14.12, up to a lower high at 17.18, and then down to lows at 14.68. Notice that the 200-day moving average is around 14.60, and the 50-day is at 15.90, hmm our trading range. What must happen for us to be long this stock is a substantial time frame above the 50day MA, which will be quite difficult therefore I hold that the opposite will happen that of a break of the 14.60 for a substantial period which 'SHOULD' trade us down to the $12 level. There is a 38 Fib number down by $12.85 area on this stock so I would be looking for that level to hold before we go into a tail spin if we do
The FED
The overall gist of all the FED"s actions is to boost home prices. They constantly peddle this as good for America when we all know it is unrealistic. Ben Bernanke in 2007 was on television saying home prices would NEVER drop because America had never had home prices declines in over 90 years of statistical data (2007 average home price was over $228k, now we stand around 178k) . America's wages are deflating (adjusted for inflation), taxes, fees and "other" (i.e.- monopoly greed) costs are going up constantly, and the FIRE economy jobs are not coming back. The reason people are defaulting is that homes were overpriced and overpaid for and people don't have the income to service the debt! And they still are by far. Why should one be a debt slave to own a home? This does nothing to help homeowners. It of course only helps the banks.
People are not borrowing because a generational shift in mood and attitudes toward debt is occurring and the FED is lost on this point. Banks are not lending because they too are human subject to social force moods and risk taking is diminishing. Asset mania has likely peaked for more than a generation. I strongly believe we are in a time when more and more might see it prudent to save over invest.
People are not borrowing because a generational shift in mood and attitudes toward debt is occurring and the FED is lost on this point. Banks are not lending because they too are human subject to social force moods and risk taking is diminishing. Asset mania has likely peaked for more than a generation. I strongly believe we are in a time when more and more might see it prudent to save over invest.
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