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Wall Street close watch

  • #141
  • Jan 30, 2008 10:14am Jan 30, 2008 10:14am
This is how I see it:

No cut: disaster, disappointment, letdown. DJI at 10 points by noon tomorrow. Mild exaggeration

25 bps: Mumbling. Then disaster, disappointment, letdown. DJI at 11 points by noon tomorrow.

50 bps: Mumbling. Pseudo-content. Then annoyance that the ensuing rally doesn't seem to go past certain levels and progress isn't 500 ticks per second as expected. What's wrong? Why isn't this exploding higher? Wait...why is there suddenly that red candle? Wot? Why? What the...
Disaster, disappointment, letdown. DJI at 12 points by late next week.

75 bps: Ahhhh, that's more like it. Gimme the juicy juice! Soar, stocky-stocks, soar! SOAR! BUYBUYBUYBUYgivecramerareacharoundBUYBUYBUY ahh..phew...*fall asleep content and literally spent*
2 weeks pass, the new downgrades hit the headlines, glimmers of the REAL amount of crap residing in books still starts to slowly bubble towards the surface of reality..
Wait...why is there suddenly that red candle? Wot? Why? What the...
Disaster, disappointment, letdown. DJI at 1 point 4 weeks later.

There, that should cover all bases

--

(personal guesstimate is 50bps, simply due to the logic of if the guy even panic-intervenes with a supercut, then he can't disappoint a > 60% futures expectation in turn with the risk of wasting the previous effort in a heartbeat )
Trust price. Know yourself.
  • #142
  • Jan 30, 2008 10:18am Jan 30, 2008 10:18am
Thats it in a nutshell except " downgrades hit the headlines" it at the bottom of markets. Upgrades happen at tops.
  • #143
  • Jan 30, 2008 11:28am Jan 30, 2008 11:28am
@ ST

I'm getting my hardhat out


Also just saw this now - blew my mind

http://bigpicture.typepad.com/commen...f-the-day.html (since that's where I got it from that saves me putting up 2 links)
Trust price. Know yourself.
  • #144
  • Jan 30, 2008 1:20pm Jan 30, 2008 1:20pm
Quoting SeekingLight
(personal guesstimate is 50bps
What do I win
Trust price. Know yourself.
  • #145
  • Jan 30, 2008 2:16pm Jan 30, 2008 2:16pm
Quoting SeekingLight

50 bps: Mumbling. Pseudo-content. Then annoyance that the ensuing rally doesn't seem to go past certain levels and progress isn't 500 ticks per second as expected. What's wrong? Why isn't this exploding higher? Wait...why is there suddenly that red candle? Wot? Why? What the...
Disaster, disappointment, letdown. DJI at 12 points by late next week.
First half pretty much accurately describes what I see going on on that DJI...how is everyone else?

I'm currently hugging and loving certain positions to death
Trust price. Know yourself.
  • #146
  • Jan 30, 2008 3:04pm Jan 30, 2008 3:04pm
A stock rally fueled by the Fed's latest interest rate cut lost momentum in the final hour after CNBC reported that two big bond insurers could be downgraded as early as today.

The market soared after the Federal Reserve announced a half-point interest rate cut, as expected, and suggested more cuts are possible.


But the market quickly turned negative after CNBC reported that Wall Street bond rating agencies could downgrade two big bond insurers, Ambac Financial Group and MBIA, even though New York state insurance regulars would like to get a postponement until the state can develop a bailout package.
  • #147
  • Jan 30, 2008 3:58pm Jan 30, 2008 3:58pm
Quoting SeekingLight
First half pretty much accurately describes what I see going on on that DJI...how is everyone else?

I'm currently hugging and loving certain positions to death
bad, bad.... carry seller..
  • #148
  • Edited 5:40pm Jan 30, 2008 5:29pm | Edited 5:40pm
Old news cesarnc, was known far, far before today's cut announcement..(the downgrade)

Definitely wasn't the factor - or rather those who already knew henceforth knew this crush would be coming.

Say, like that guy joking about the possible 50bps cut scenario outcome he had in mind

So, anyone need any JPY?

I got some :>

Oh and I think I have some Franc lying round as well now

I just love it when a plan comes together.

P.S. - you can't say the FOMC disappoints. I think I've witnessed over half a dozen now live do this very thing - surge one way, then crash back 100% of the move almost everywhere. Crazy, isn't it? Crazy. Merlin - you got a possible explanation for this more-than-random-occuring behavior? You've most likely watched more than me
Trust price. Know yourself.
  • #149
  • Jan 30, 2008 9:07pm Jan 30, 2008 9:07pm
Most every Fed announcement has a reaction and then counter reaction. Overnight globex futures are currently continuing the counter move. But let see what thursday does. Again many times the reverse of what globex does.
  • #150
  • Jan 30, 2008 10:16pm Jan 30, 2008 10:16pm
Today's Dow and S&P daily bars closed in pinbar form. Pinocchio nose pointing skyward. So if the drop comes, reversal from todays high will be ugleee.
  • #151
  • Jan 31, 2008 2:04am Jan 31, 2008 2:04am
Quoting SunTrader
Today's Dow and S&P daily bars closed in pinbar form. Pinocchio nose pointing skyward. So if the drop comes, reversal from todays high will be ugleee.
Yea..I'm just worried Asia has been re-pumping so hard..cheap retrace bargains or something spooky?

I also would have much preferred a more clearly defined uber-rally for 0 reason and steep bars before the pin bar..like this it just feels...wrong..

Wouldn't mind it still working, but I already went to bed last night with a feeling things might retrace while I slept..AUDUSD at the 50% mark now, dito UJ...

And did anyone notice, the USDX is working VERY hard to keep 75. VERY.
Trust price. Know yourself.
  • #152
  • Jan 31, 2008 9:42pm Jan 31, 2008 9:42pm
Quoting SeekingLight
Merlin - you got a possible explanation for this more-than-random-occuring behavior? You've most likely watched more than me
yes i have seen and traded this pattern, its one of my favorite news trading strategies. what i believe is happening is that the market has priced in all of the available info and is resting at equilibrium. then the fed statement (or any other overly hyped event) comes out and traders react, causing huge spikes. but the statement has not caused a fundamental shift in the way the big money sees things. so if the EURUSD spikes up, the big bears think "hey, im getting a deal!" so they start selling until it reaches equilibrium again (ie the price before the event). the opposite happens to the big bulls if the price spikes down. this is my explanation of why we seem to go back to the starting point. obviously i cant prove any of this LOL! but thats how i see it
Relax and be happy.
  • #153
  • Feb 1, 2008 2:20am Feb 1, 2008 2:20am
Quoting merlin
this is my explanation of why we seem to go back to the starting point. obviously i cant prove any of this LOL! but thats how i see it

I like the equilibrium idea.(say, I think I've read you write about this before...now that I'm starting to wake up a bit...musta been a while though)

Isn't it interesting to see that we create seemingly logical explanations for observed repeatable phenomena?

And imho even our "naive guesses", as long as they're founded on reasoning, often bring us close to, if not right to a possible truth sometimes...

Although history has shown that a lot of originally "only logical explanations" turned out to be quite miles off the mark

But I agree on that idea, it sounds nice...one could also argue that big moeny doesn't newstrade and the same "push and shovers" that are stupid enough to squish price around during "lightweight lifting" time have a counterpart or maybe it's even the same types that go against the original pushers again...crush the stops of old, flip to crush those of new..sure, why not, if it brings munnayyyy...

It's still a bit peculiar mainly the FOMC does it this harshly/round trip wise...something like a surprise BOE hike by 50bps vs 25bps actually sustained it's price rise...that was back in the 1.8 or 1.9 days I think..2006? Before we had 5.xx I think, not sure..
I remember at the time watching, thinking "hah, any time now the inevitable fade will come after 200+ pips!".....noooooo, it did not

P.S. I so very much do wonder what will happen if 75 USDX gets aggressively tested and....broken? Feels like we're just about to get a very ugly squeeze again on EURUSD e.g., price has run out of space and wedged itself in between a rising TL and capping resistance..and 75-74.5 seems like a big deal to many...75% being psychological, 3/4 and all that..like first 100 and 90 and 80 seem to've been, too
Trust price. Know yourself.
  • #154
  • Feb 1, 2008 5:47am Feb 1, 2008 5:47am
I mentioned somewhere recently that I am seeing more and more eurobears coming out of the closet... but to be quite honest I think they will be forced to eat their 1.5000+ stops in the near future.

I am planning to start piling on EUR long positions during London on Monday, when the immediate NFP aftermath is out of the way.
  • #155
  • Feb 1, 2008 6:52am Feb 1, 2008 6:52am
Quoting fierceman
I mentioned somewhere recently that I am seeing more and more eurobears coming out of the closet... but to be quite honest I think they will be forced to eat their 1.5000+ stops in the near future.

I am planning to start piling on EUR long positions during London on Monday, when the immediate NFP aftermath is out of the way.


I am currently wondering about that whole USDX 75 situation, also the EURGBP /// GBPUSD vs EURUSD stuff...

I wasn't surprised to see that the PB we got on DJI/S&P got invalidated by a BUOB(bullish outside bar) and that now the futures and the DAX are rallying higher.. but I couldn't explain it outside of a chart.

All this nonsense being propagated about the bond insurers being saved and so forth just sounds a lot to me like the original "don't worry about subprime situation" fluff as well.
Then again, of course, almost anything that could be done to save the Titanic is being done and the bilge pumps are working at full tilt.

So hell, I don't know.
Personally I feel we are approaching crucial levels rapidly which should decide whether or not this rally is really genuine and how prone to selloffs we still are.
Ironically, as always, these of course coincide with big announcements.

I basically expect utter mayhem today, and completely erratic reactions over several hours... mostly because the market is driving mostly on hopes and dreams right now and there is this very, very strong wish overshadowing everything for it to just be over(which makes it possible for a very unidirectional behavior to come through on "good news", regardless of how singular and irrelevant all of this stuff is in the big picture).. and I am wondering whether this belief alone can squeeze hard enough to make it sort of come true for much further and longer than would be normally sensible.

Not sure if I'm making sense or not.. then again - is the market?

Not going to try and predict anything today
Trust price. Know yourself.
  • #156
  • Feb 1, 2008 7:07am Feb 1, 2008 7:07am
Agreed as usual SL. I am definitely on the sidelines today...

BTW Microsoft made a $45bn offer for Yahoo, which works out to $31/share (quite a bit above market value). This is pushing US futures up for now. There is also some possible buyout activity going on in mining as well, and bets are that the sector will be little affected by the US slowdown. A strong NFP could make the rally somewhat more believable in the short term, but I do believe that all of this only puts us bears in the market at a better price.
  • #157
  • Feb 1, 2008 7:49am Feb 1, 2008 7:49am
Hey Merlin, as per our conversation of the past about the NFPs.. The thing is this time it's different. Take a look, the the Buyers are not picking up the drop like they have been in the last year of NFPs. I think we have fundemental difference here. Looks like you are going to get your down turn after all...

It looks like thre really is not the follow through that has been there until now. Interesting...

EDIT, I removed the info about my trade, because I thought it did not add anything to the conversation and detracted from the thread.
  • #158
  • Feb 1, 2008 8:42am Feb 1, 2008 8:42am
Quoting smjones
The thing is this time it's different.
That's a good cue...am I the only one noticing the seemingly complete detachment of the xxxJPY from the surge in stocks in the last 24 hours?

Not that I mind...I just found it curious..

Oh, and there was another mule kick from that USDX 75 area.

Ouch, especially ouch on GBPUSD.
Trust price. Know yourself.
  • #159
  • Feb 1, 2008 8:43am Feb 1, 2008 8:43am
Food for thought

I just don't understand the market's obcession with an economic indicator that is from 30% to 550% wrong, 80% of the time. I mean, WTF can such indicator tell about the economy with THAT degree of accuracy?

Last 18K wasn't 18K. It was 82K (a 550% miss)

Now, this -17K is almost surely NOT -17K. Could go from -80K to +132K, let's wait for next month...

Now, what can one tell about the economy in such a muddy data?!?!
  • #160
  • Feb 1, 2008 8:53am Feb 1, 2008 8:53am
Quoting cesarnc
Food for thought

I just don't understand the market's obcession with an economic indicator that is from 30% to 550% wrong, 80% of the time. I mean, WTF can such indicator tell about the economy with THAT degree of accuracy?

Last 18K wasn't 18K. It was 82K (a 550% miss)

Now, this -17K is almost surely NOT -17K. Could go from -80K to +132K, let's wait for next month...

Now, what can one tell about the economy in such a muddy data?!?!
It isn't the indicator I am talking about. I am referring to the fact that there was no fade after the move. To me this shows a general change in opinion on the Dollar. I also found it very interesting that the disconnect that you refer to also happened in the EURUSD andGBPUSD, which initially went oposite directions and then the EU went lock step with the GU. This is also different. than at least the last 7 or so NFPs.

BTW it was the ADP I was trading from, using the NFP as a catalyst.
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