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  • #13,361
  • Dec 4, 2011 5:33pm Dec 4, 2011 5:33pm
Quoting Tom_D_Trader
Conclusion

OH MY! lol
  • #13,362
  • Dec 4, 2011 5:37pm Dec 4, 2011 5:37pm
Quoting PipKiller
Things that make you go Hmmmmmmmmmm!!!!

Reading this thread makes one think all the big Euro bears are here. Almost every fundamental article posted in this thread says the euro should die a painfull death.......... But has anyone stop to anylze why it doesn't crash ........ Hmmmmmmm.... Something to think about..


with the way the fundamentals are playing at the mo..... I'm bullish

but that can change :-)
patience is a virtue
  • #13,363
  • Dec 4, 2011 5:52pm Dec 4, 2011 5:52pm
Quoting PipKiller
Things that make you go Hmmmmmmmmmm!!!!

Reading this thread makes one think all the big Euro bears are here. Almost every fundamental article posted in this thread says the euro should die a painfull death.......... But has anyone stop to anylze why it doesn't crash ........ Hmmmmmmm.... Something to think about.
I analyse that every day. As you said, it is an ugly dog contest.
I feel Europe is the winner (the ugliest dog) in all this but the US is up to its dirty tricks trying to be uglier. This will only work for some time. In the mean time, you are absolutely correct. Trade what you see, not what you feel.

This week should be very interesting, either they manage to do some more can kicking, or the poop hits the fan. Time will tell. We will probably know by Wednesday.
Those who say it cannot be done should not interrupt those who are doing it
  • #13,364
  • Dec 4, 2011 6:06pm Dec 4, 2011 6:06pm
A Rally and a Reality Check (or Two)
by Shah Gilani


Dear Reader,

"Rudolf with your nose so bright, won't you guide my sleigh tonight..."

Thank goodness there's a light out there somewhere, so we can see what's coming.

And judging by last week's market action, guess what?

Santa Claus is coming to town!

Ho, ho, ho, what a rally. The Dow Jones Industrials rose 787.64 points, a 7.01% jump, making it the venerable benchmark's second-best weekly up-move ever! The S&P 500 rocketed up 7.39%. The Nasdaq Composite shot up 7.59%.

But the real winner was the broader market, encompassing the less muscular household names ensconced in the Russell 2000; it rose a whopping 10.34%.

Speaking of the 10% gainers club, guess who else got their tickets punched on this sleigh ride? Not surprisingly (considering a little thing called "short-covering"), Italy was up 10.4%, Spain was up 10.24%. France was up 10.78%, and Germany was up 10.7%.

The week before last, not one single stock market in the world advanced by even a hair. Last week, every single key stock market in the world rose - and very impressively.

Oh, wait a minute. There was one little country that actually fell almost 1%. Good thing they're not on anybody's radar and don't matter much. Who was it, you ask?

China.

Ho, ho... uh-oh!

In fact, China was the only real "reality check" on the bullish stampede last week.

The Chinese government lowered the reserve ratio it makes banks hold against loans outstanding and the new ones they make. They did that, not because they're little elves cobbling together market gifts, but because the Chinese credit markets are getting uncomfortably tight. They did it to ease into further easing. They did it gently - as opposed to lowering interest rates - to add liquidity to their banking system.

The same banking system that's afraid of (and very exposed to) Europe.

Oh yeah! Europe, we almost forgot didn't we? There's something going on over there, right?

No, no, no... it's over, didn't you just read about how all the world's markets rose last week? Didn't you hear the good news? Don't you know that the U.S. Federal Reserve huddled with central bankers from the ECB, the U.K., Canada, Japan, and Switzerland to lower the interest rate they charge on dollar swaps?

You know... dollar swaps... those little arrangements that allow foreign banks to swap their unloved currencies for dollars. They really come in handy when there's a panic and a flight to the safety into U.S. Treasuries (whose purchases must be made with dollars, thank you), or some unlikely black swan event that never happens... kind of like what happened in 2008. But, like I said, that never happens.

Thank you China, for one reality check.

Here's another: Adding liquidity on an essentially massive scale, in a globally coordinated fashion - kind of exactly like what the Fed just orchestrated (at the behest of America's biggest banks, by the way, and the quivering Europeans) - isn't a sign that Santa Claus is coming to town.

It's about getting ahead of a potential meteor hitting us and causing a nuclear winter... this winter, as in any day now.

Oh, don't worry; I'm just saying that for dramatic effect. Silly me, as if...

Sorry, lost my holiday spirit for a second there. About that rally!

Will there be continued momentum? That depends on... Europe.

Remarkably, if you look almost any or almost all the world's key markets in terms of their three-month, six-month, one-year and two-year charts, they are eerily similar. Talk about correlation, wow!

We're all near the same place at the same time - a place from which we can either rally or tank.

My bullish scenario stems from the fact that we can't take a black swan event. It would be catastrophic for global markets.

Of course, Europe is the ugly duckling that could be that black swan.

For the life of me, I have to be bullish at this very, very critical juncture for global markets. Why? Because I'm not the only one looking at all this correlation. The Fed sees it, the Europeans see it, and the whole world sees it.

Europe has to come up with a plan this week. They have to.

It doesn't have to be an immediate fix - there isn't one. But it has to make sense to the markets and essentially be bigger than the markets.

Is that possible? Is there any fix for anything that's bigger than the markets? Only if the fix is a massive coordination, on an unlimited, global scale, backed by credible measures and the firepower of the world's central banks.

We got the first whiff of that on Wednesday. That was the market's shot across the bow.

It was a silver bullet aimed at the shorts. And it worked beautifully. It was so effective that I can almost see the Bernanke and Draghi snickering together and looking out from their bunker, as if to say, if you liked that silver bullet, you're gonna love this silver bazooka we have, and watch out, we will use it.

I can't stand in the way of firepower like that. Well, maybe you shouldn't. But I will.

I will, because there's a chance that I'm wrong (yeah, it happens, I know, you can't believe that, can you?).

Maybe, just maybe, and this is going to get me in trouble, I know it, maybe Europe will drop-kick Greece, and maybe Portugal, at the end of this week, or over next week-end?

Maybe they don't have any hope of working out all their problems...

Maybe the French say, screw it, we won't risk our AAA status, which will immediately get cut if they agree to backstopping a deeper bailout pool for the PIIGS, because they can't afford it.

Maybe the Germans will say achtung baby, fold their arms and let the chips fall where they might. It could happen.

So, I'm going to add to my shorts here. I'm going to add up to the Dow reaching 12,200.

If I'm wrong, I'll get out very quickly. If I'm right, then things will be really wrong.

But I'm a trader; this is what I do to make money. I take risks.

On the other hand, we could be setting up for a short rocket ride higher, which is okay with me, because I have my share of long positions too. However, they are all locked-down with stop-loss orders in the event that the correlation that's here ends up being the Grinch that steals Christmas.

Stay tuned... This could be one heck of a week, one way or another.
  • #13,365
  • Dec 4, 2011 6:12pm Dec 4, 2011 6:12pm
http://www.actionforex.com/action-in...0111204154775/

Snippet:

German Chancellor Merkel and French President Sarkozy will meet on Monday to reach "French-German propositions" on budget policing for the summit, which could involve treaty changes. But it's reported that the agreement might not be reached as Merkel and Sarkozy are still having diverged stance on the role of ECB. There were speculations that ECB would channel as much as EUR 200b through IMF to tackle the sovereign debt crisis. But as usual, was opposed by Germany even though Merkel seems prepared for ECB's stepping up of bond buying.
  • #13,366
  • Dec 4, 2011 6:19pm Dec 4, 2011 6:19pm
Quoting lovepips
with the way the fundamentals are playing at the mo..... I'm bullish

but that can change :-)
Inserted Video


And change quickly it can Hmmmmmmmmm.
I don't care which way the market is going as long as it's going my way
  • #13,367
  • Dec 4, 2011 7:04pm Dec 4, 2011 7:04pm
Quoting PipTrapper
I analyse that every day. As you said, it is an ugly dog contest.
I feel Europe is the winner (the ugliest dog) in all this but the US is up to its dirty tricks trying to be uglier. This will only work for some time. In the mean time, you are absolutely correct. Trade what you see, not what you feel.

This week should be very interesting, either they manage to do some more can kicking, or the poop hits the fan. Time will tell. We will probably know by Wednesday.
I just wanted to remind all to not ignore the other side of the coin.


It's going to be an interesting week for the risk on risk off trade with some of the economic reports, major headline risk from Europe this week and through next weekend with the EU summit starting friday and thin liquidity heading into the holidays. Contraction in China isn't going to help either but it's largely being ignored with the Euro crisis being the big thing that everone is focused on.

I see more can kicking until it just simply can't be kicked anymore, the poop hits the fan and nuclear winter sets in.

Me, I still see a risk on rally coming and I've faded back into my "risk on" positions friday as I still see momentum to the upside on the daily charts. I'm in to ride the hopium train for the first part of the week and will adjust as necessary. I'm a little underwater right now but nothing that isn't manageable with very small lot size.
I don't care which way the market is going as long as it's going my way
  • #13,368
  • Dec 4, 2011 7:07pm Dec 4, 2011 7:07pm
I like the contrarian euro position, no doubt about it, it is uber bearish, but taking a look at the price action as we bounced off the long-term low, i just don't see it, i don't see the conviction, we ran into supply just above the low and sold off uber hard on fridays news. i don't think i can be a euro contrarian just yet. maybe in the future. nothing i love more than a hella fast bear market short squeeze.

cheers.
  • #13,369
  • Dec 4, 2011 7:24pm Dec 4, 2011 7:24pm
Quoting knoholygrail
A Rally and a Reality Check (or Two)
Oh, wait a minute. There was one little country that actually fell almost 1%. Good thing they're not on anybody's radar and don't matter much. Who was it, you ask?

China.

Ho, ho... uh-oh!

Today I was about to ask if, after this whole European situation stops being the most important problem in the markets, PT would create a thread called Chinalysis

http://www.moneyandmarkets.com/monet...48255?FIELD9=4
  • #13,370
  • Dec 4, 2011 7:55pm Dec 4, 2011 7:55pm
Quoting Pbh
Today I was about to ask if, after this whole European situation stops being the most important problem in the markets, PT would create a thread called Chinalysis

http://www.moneyandmarkets.com/monet...48255?FIELD9=4
He'll call it Shanghied

China may be slowing down but they are still growing and unlike the US and Europe.... They still have money, they ain't broke.

No worries though Ben would just airlift 20 trillion to china and put us deeper in debt if China went broke.

Inserted Video
I don't care which way the market is going as long as it's going my way
  • #13,371
  • Dec 4, 2011 8:05pm Dec 4, 2011 8:05pm
Quoting Pbh
Today I was about to ask if, after this whole European situation stops being the most important problem in the markets, PT would create a thread called Chinalysis

http://www.moneyandmarkets.com/monet...48255?FIELD9=4
Thats interesting, I hadn't even looked at the shanghai index, I glance at a china etf on my spreadsheet but that price action didn't show through. I'm gonna have to add some china information to my list. It probably isn't too much of an oddball incident, if they loosen they weaken the currency, i'm assuming the inter-market correlations in china are more traditional, like what we've seen in the past, strong yuan, strong equities whereas nowadays we have the inverse relationships . with loosening giving traders fear of a weaker yuan, equities most likely sold off as well.

thanks for the info!

have a good trading week!
  • #13,372
  • Dec 4, 2011 8:14pm Dec 4, 2011 8:14pm
actually no thats wrong, scratch that, china sold off ahead of us because their wednesday is our tuesday night. its possible that selloff motivated a central bank move? i'm confus, well i tried. lol

enjoy trading.
  • #13,373
  • Dec 4, 2011 8:19pm Dec 4, 2011 8:19pm
Quoting traderlars
actually no thats wrong, scratch that, china sold off ahead of us because their wednesday is our tuesday night. its possible that selloff motivated a central bank move? i'm confus, well i tried. lol

enjoy trading.
but the article points out the week performance
  • #13,374
  • Dec 4, 2011 8:40pm Dec 4, 2011 8:40pm
yea you're right, that article points out the relative performance of shanghai and the aussie, i must have been looking at something else. its late here and i'm getting ready for bed. anyways, i just glanced at the shanghai index and noticed they sold off hard Wednesday prior to the coordinated central bank move. i'm now wondering when they announced the easing, before, during or after the wednesday session in asia. anyways i suppose it doesn't matter.

thanks for that jack crooks article, i didn't realize the strong divergence taking place in aussie and the shanghai index nor the strong correlation between the two.

cheers!
  • #13,375
  • Edited 10:15pm Dec 4, 2011 10:01pm | Edited 10:15pm
Inserted Video
!


The point of this video is the irony behind it, of what their army is doing today



Foreign Policy if stays like this si a big mountain of debt. US invests an average of $700 billion a year (i read it on times) on military funding.

imagine if they pulled the tropps back and used that money for their people's increasing needs.

the love truning into revolution was a wow...
Have I got something on my face, SOLDIER?
  • #13,376
  • Dec 4, 2011 10:16pm Dec 4, 2011 10:16pm
Quoting bumapatria
http://www.youtube.com/watch?v=Ao461...ayer_embedded#!


The point of this video is the irony behind it, of what their army is doing today



Foreign Policy if stays like this si a big mountain of debt. US invests an average of $700 billion a year (i read it on times) on military funding.

imagine if they pulled the tropps back and used that money for their people's increasing needs.
True..but thats why major corrupted people are interested in politics to get the chair, pen and paper and mislead the money-flow :S
Attached Image (click to enlarge)
Click to Enlarge Name: E8.png Size: 77 KB
  • #13,377
  • Dec 4, 2011 10:37pm Dec 4, 2011 10:37pm
What Does Santa Claus Rally Mean?
A surge in the price of stocks that often occurs in the week between Christmas and New Year's Day. There are numerous explanations for the Santa Claus Rally phenomenon, including tax considerations, happiness around Wall Street, people investing their Christmas bonuses and the fact that the pessimists are usually on vacation this week.
http://i.investopedia.com/inv/092009...y/inv_icon.jpg
Investopedia explains Santa Claus Rally
Many consider the Santa Claus rally to be a result of people buying stocks in anticipation of the rise in stock prices during the month of January, otherwise known as the January effect.




So

A) if prices go up between now and Christmas it is not a Santa Claus rally
B) if expectation is that prices will go down in January, then there won't be a Santa Claus rally


Kill the ego, or it will kill the mission.
  • #13,378
  • Dec 4, 2011 10:40pm Dec 4, 2011 10:40pm
Quoting rekon67
True..but thats why major corrupted people are interested in politics to get the chair, pen and paper and mislead the money-flow :S
I am a strong supporter of halving the US military budget. But what will this do to the economy? So many of high end US manufacturing jobs (you know, the ones they don't export to China) are directly or indirectly paid for by the US military.
Kill the ego, or it will kill the mission.
  • #13,379
  • Dec 4, 2011 11:04pm Dec 4, 2011 11:04pm
Quoting AaronWard


So


A) if prices go up between now and Christmas it is not a Santa Claus rally
B) if expectation is that prices will go down in January, then there won't be a Santa Claus rally



A). True. Rising price before the end of December and the first couple days of January is not the santa claus rally. Price can rise through the month of december and still get the santa claus pop.

B). True. If the Santa Claus rally doesn't happen, the bears often take charge at the beginning of the year.
I don't care which way the market is going as long as it's going my way
  • #13,380
  • Dec 4, 2011 11:07pm Dec 4, 2011 11:07pm
Quoting PipKiller
B). True. If the Santa Claus rally doesn't happen, the bears often take charge at the beginning of the year.
Good to know. I would like to be in charge for a change. I'll make sure my women friends read about this.
Kill the ego, or it will kill the mission.
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