Guest View
User: Pass: | become a member
Author Archive for Chart School

Could the positive Greek bailout news be bad for stocks? The Downgrade was good for stocks for a few weeks!

Courtesy of Chris Kimble.

S&P Downgraded European debt on 1/17 and the Power of the Pattern reflected  this could be good news for investments(see post here) … Greek ETF(GREK) gained 40% and the National Bank of Greece(NBG) gained 100% in the three weeks after the downgrade-

Was bad news good for stocks?  Could good news do the opposite to them?

CLICK ON CHART TO ENLARGE

Yesterday morning Greek Leaders announced that a bailout agreement is at hand. (see CNBC article)   How interesting this news comes out as Investor bullish sentiment is hitting loft levels, tons different than 120 days ago (see post here)

Could this positive news out of Greece be bad news for investments?  Will be tough to stop the positive momentum the market has… do make a little note on the calendar of todays news and lets see down the road if it was a key date like 1/17/2012 ended up being.




Could the positive Greek bailout news be bad for stocks? The Downgrade was good for stocks-

Courtesy of Chris Kimble.

S&P Downgraded European debt on 1/17 and the Power of the Pattern reflected  this could be good news for investments(see post here) … Greek ETF(GREK) gained 40% and the National Bank of Greece(NBG) gained 100% in the three weeks after the downgrade-

Was bad news good for stocks?  Could good news do the opposite to them?

CLICK ON CHART TO ENLARGE

Yesterday morning Greek Leaders announced that a bailout agreement is at hand. (see CNBC article)   How interesting this news comes out as Investor bullish sentiment is hitting loft levels, tons different than 120 days ago (see post here)

Could this positive news out of Greece be bad news for investments?  Will be tough to stop the positive momentum the market has… do make a little note on the calendar of todays news and lets see down the road if it was a key date like 1/17/2012 ended up being.




Treasuries Update: Operation Twist and the 30-Year Fixed Rate Mortgage

Courtesy of Doug Short.

Note from dshort: The weekly Freddie Mac update released today shows the 30-year fixed rate mortgage at the historic low of 3.87% for the second consecutive week. The goal of Operation Twist to lower long-term rates appears to have had the desired impact on mortgage rates. The impact on Treasuries is less clear.


The Federal Reserve officially announced Operation Twist on September 21 with the stated purpose of lowering longer-term interest rates. The yield on the 10-year note had been below 2.00% 5 of the 9 days prior to the much-rumored announcement, closed at a new low of 1.88% on the day of the announcement and reached the historic closing low of 1.72 the next day, September 22.

What has the 10-year note done since the “Twist” announcement? The interim high daily close was 2.42 on October 27. The interim closing low was the 1.82 on December 19th. Since that time, the 10-year has danced around the 2.00 level with the latest close at 2.04.

Here is a snapshot of selected yields and the 130-year fixed mortgage since the inception of Operation Twist.

Background Perspective on Yields

The first chart shows the daily performance of several Treasuries and the Fed Funds Rate (FFR) since 2007. The source for the yields is the Daily Treasury Yield Curve Rates from the US Department of the Treasury and the New York Fed’s website for the FFR.

 

Click to View
Click for a larger image

 

Here’s a closer look at the past year with the 30-year fixed mortgage added to the mix (excluding points).

 

Click to View
Click for a larger image

 

Here’s a comparison of the yield curve at two points in time: 1) today’s close and 2) the daily close on the market’s interim high on April 29th.

 

 

The next chart shows the 2- and 10-year yields with the 2-10 spread highlighted in…
continue reading




Apple Computer and Newton’s Law of Gravity

Courtesy of Doug Short.

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.


The Power of the Pattern suggested that Apple could run up to $500 on a breakout of resistance. See the first chart below, which I included in my January 20th post here.


 

Click to View
Click for a larger image

 

Newton’s law of gravity hasn’t worked to well on Apple of late. Apple was at $358 when the chart above was made, and today Apple has traded as high as $496 a share. APPL is up over $70 a share since the last breakout illustrated above at line (1).

This is an excellent example of why it can pay to follow breakouts!

 

Click to View
Click for a larger image

 

Apple is now reaching the top of its rising channel…. A bad idea to harvest some gains right now? Could Apple at resistance impact the broad market?

 

(c) Kimble Charting Solutions
blog.kimblechartingsolutions.com

 

 

 

 




S&P 500 Snapshot: Another Fractional Gain

Courtesy of Doug Short.

The S&P 500 today was quite similar to yesterday. It traversed about a nine-point range to the morning low and slowly rallied to an early afternoon high and then drifted down in the last two hours of trading for a fractional gain of 0.15%. Nevertheless, today’s close sets a new 2012 high — up 7.50% year-to-date and only 0.86% below its interim high at the end of April 2011.

From an intermediate perspective, the S&P 500 is 99.8% above the March 2009 closing low and 13.6% below the nominal all-time high of October 2007.

Below are two charts of the index, with and without the 50 and 200-day moving averages.

 

Click to View
Click for a larger image

 

 

Click to View
Click for a larger image

 

For a better sense of how these declines figure into a larger historical context, here’s a long-term view of secular bull and bear markets in the S&P Composite since 1871.

For a bit of international flavor, here’s a chart series that includes an overlay of the S&P 500, the Dow Crash of 1929 and Great Depression, and the so-called L-shaped “recovery” of the Nikkei 225. I update these weekly.

These charts are not intended as a forecast but rather as a way to study the current market in relation to historic market cycles.

 

 

 

 




Apple reaches $500 Power of the Pattern target…Time to do a little harvesting?

Courtesy of Chris Kimble.

The Power of the Pattern reflected that Apple could run up to $500 on a breakout of resistance(see post here)

CLICK ON CHART TO ENLARGE 

Newtons laws of gravity hasn’t worked to well on Apple of late.  Apple was at $358 when the chart above was made and today Apple has traded as high as $496 a share.  APPL is up over $70 a share since the last post/breakout above line (1) above

An example of why it can pay to follow breakouts!

CLICK ON CHART TO ENLARGE

Apple is now reaching the top of its rising channel…A bad idea to harvest some gains right now?  Could Apple at resistance impact the broad market?

 




Could Apple reach $500 update…

Courtesy of Chris Kimble.

The Power of the Pattern reflected that Apple could run up to $500 on a breakout of resistance(see post here)

CLICK ON CHART TO ENLARGE 

Newtons laws of gravity hasn’t worked to well on Apple of late.  Apple was at $358 when the chart above was made and today Apple has traded as high as $496 a share.  APPL is up over $70 a share since the last post/breakout above line (1) above

An example of why it can pay to follow breakouts!

CLICK ON CHART TO ENLARGE

Apple is now reaching the top of its rising channel…A bad idea to harvest some gains right now?  Could Apple at resistance impact the broad market?

 




The ”Non-Bounce” in Non-Revolving Credit

Courtesy of Doug Short.

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.


Joe Weisenthal writing for Business Insider reports Consumer Credit Demolishes Expectations, Grows $19 Billion.

It’s hard to think that the economy is going into any kind of recession with numbers like these. For the second straight month we just got a HUGE number on consumer credit.

Consumer credit expanded by $19 billion in December. That’s far more than the $7 billion that was expected by economists.

This chart from Reuters’ Scotty Barber basically tells it all.

The data on which that chart was produced was the Consumer Credit – G.19 government report.

Demolishing the Revolving Credit Side of the Story

Lance Roberts of Streettalk Live demolishes the revolving credit side of Weisenthal ‘s story (a $4 billion December rise) in an excellent perspective Consumer Credit and the American Conundrum.

Demolishing the Non-Revolving Credit Side of the Story

My job is to demolish the non-revolving side of Weisenthal’s story, and it’s an exceptionally easy task to do.

Non-Revolving credit rose $11.8 billion in December. However, $8.8 billion of that is growth in federal government loans (which just happens to be where student loans are parked).

Here are some charts I put together stripping out federal government loans.

Non-Revolving Loans Minus Government Loans

Non-Revolving Loans Minus Government Loans Detail

True Bounce in Percentage Terms

Note that the year-over-year “bounce” has not even gotten back to the zero-line in spite of exceptionally easy comparisons.

Middle-Aged Borrowers Pile on Student Debt

Reuters reports Middle-Aged Borrowers Pile on Student Debt

Educational borrowing is up for every age group over the past three years, but it has grown far more quickly among those between 35 and 49, according to the analysis of more than 3 million credit reports provided to Reuters by the credit score tracking site CreditKarma (CreditKarma.com). That group saw its school debt burden increase by a staggering 47 percent, according to the analysis.

The average student loan debt for those aged 38 to 41 was the biggest of that group — about $12,000, up from just under $9,000 in 2009. Young people still carry…
continue reading




Weekly Unemployment Claims Down by 15,000

Courtesy of Doug Short.

The Unemployment Insurance Weekly Claims Report was released this morning for last week. The 358,000 new claims is a 15,000 decrease from an upward adjustment of 6,000 for the previous week (373K, previously 367K). The less volatile and closely watched four-week moving average came in at 366,250, the 13th week below 400K after 29 consecutive weeks above that benchmark. Here is the official statement from the Department of Labor:

In the week ending February 4, the advance figure for seasonally adjusted initial claims was 358,000, a decrease of 15,000 from the previous week’s revised figure of 373,000. The 4-week moving average was 366,250, a decrease of 11,000 from the previous week’s revised average of 377,250.

The advance seasonally adjusted insured unemployment rate was 2.8 percent for the week ending January 28, an increase of 0.1 percentage point from the prior week’s unrevised rate.

The advance number for seasonally adjusted insured unemployment during the week ending January 28, was 3,515,000, an increase of 64,000 from the preceding week’s revised level of 3,451,000. The 4-week moving average was 3,498,000, a decrease of 33,000 from the preceding week’s revised average of 3,531,000.

Today’s seasonally adjusted number came in below the Briefing.com consensus estimate of 370K and likewise Briefing.com’s own estimate of 370K.

As we can see, there’s a good bit of volatility in this indicator, which is why the 4-week moving average (shown in the callouts) is a more useful number than the weekly data.

 

Click to View
Click for a larger image

 

Occasionally I see articles critical of seasonal adjustment, especially when the non-adjusted number better suits the author’s bias. But a comparison of these two charts clearly shows extreme volatility of the non-adjusted data, and the 4-week MA gives an indication of the recurring pattern of seasonal change in the second chart (note, for example, those regular January spikes).

 

Click to View
Click for a larger image

 

Because of the extreme…
continue reading




Applying Fibonacci to Stock Market Patterns

 Applying Fibonacci to Stock Market Patterns 

It's easier than you might think! 

By Elliott Wave International

Patterns are everywhere. We see them in the ebb and flow of the tide, the petals of a flower, or the shape of a seashell. If we look closely, we can see patterns in almost everything around us. The price movements of financial markets are also patterned, and Elliott wave analysis gives you the tools to interpret those patterns.

The Fibonacci sequence is vital to Elliott wave analysis — as a matter of fact, R.N. Elliott wrote that the Fibonacci sequence provides the mathematical basis of the Wave Principle. Once you understand the Fibonacci sequence, it's easy to apply it to the markets you trade.

The following excerpt is from a new eBook from Elliott Wave International Senior Tutorial Instructor Wayne Gorman: How You Can Use Fibonacci to Improve Your Trading. Wayne explains how the Fibonacci sequence is derived and how it can be used to understand market behavior.

Learn how you can download the entire 14-page eBook below.


The Golden Ratio and the Golden Spiral

Let's start with a refresher on Fibonacci numbers. If we start at 0 and then go to the next whole integer number, which is 1, and add 0 to 1, that gives us the second 1. If we then take that number 1 and add it again to the previous number, which is of course 1, we have 1 plus 1 equals 2. If we add 2 to its previous number of 1, then 1 plus 2 gives us 3, and so on. 2 plus 3 gives us 5, and we can do this all the way to infinity. This series of numbers, and the way we arrive at these numbers, is called the Fibonacci sequence. We refer to a series of numbers derived this way as Fibonacci numbers.

We can go back to the beginning and divide one number by its adjacent number — so 1÷1 is 1.0, 1÷2 is .5, 2÷3 is .667, and so on. If we keep doing that all the way to infinity, that ratio approaches the number .618. This is called the Golden Ratio, represented by the Greek letter phi (pronounced "fie"). It is an irrational number, which means that it cannot be represented by a fraction of whole integers. The inverse of .618 is…
continue reading




 

Phil's Favorites

Why the Foreclosure Deal May Not Be So Hot After All

By Matt Taibbi, Rolling Stone

So the foreclosure settlement is through.

A few weeks back, I was optimistic about it – I had been worried that it was going to contain broad liability waivers for all sorts of activities, and I was pleasantly surprised when I heard that its scope had essentially been narrowed to robosigning offenses. 

However, now that the settlement is finalized, and I've had time to think about it and talk to people who know far more than I do about this, I'm feeling pretty queasy.

It feels an awful lot like what happened here is the nation's criminal justice honchos collectively realized that a thorough investigation of the problem would require resources they sim...



more from Ilene

Zero Hedge

Greece at the Point of no Return

Courtesy of ZeroHedge. View original post here.

Submitted by testosteronepit.

Wolf Richter   www.testosteronepit.com

"The European Union is suffering under Germany,” Georgios Karatzaferis said on Friday. He is the president of the rightwing LAOS. With 15 members in parliament, the party is a minority partner in the coalition cabinet of party-less technocrat Prime Minister Lucas Papademos. Karatzaferis accused German Chancellor Angela Merkel of trying to "impose her will on Southern Europeans." He called t...



more from Tyler

Chart School

World Markets Weekend Review: The Rally Slows

Courtesy of Doug Short.

The 2012 rally slowed last week as the average gain of our basket of eight markets dropped from 2.01% the previous week to a flat finish of 0.06%. Geographic rotation was the dominant pattern, with the world leadership moving from Europe to the Asia Pacific. Thus, the top performing Nikkei 225 had been the worst performer at the end of the previous week, while the three European indexes were demoted from stellar to cellar. The S&P 500 again finished near the middle of the pack, but in the spirit of the overall slowdown, a finish near the middle was a week-over-week close (fractionally) in the red.

The adjacent table shows the 2012 year-to-date performance of our gang of eight. Three markets have maintained their double-digit gains at the end of six weeks, with the BSE SENSEX overtaking the DAXK (i.e., the DAX ex dividends) for the lead with the Hang Seng in...



more from Chart School

Sabrient

Sabrient Risers - 2/11/2012

Top 5 RisersStockRatingAnalysisICABUYThe projected value for Empresas ICA is still rising quickly even though past earnings have already improved significantly.XBUYThe projected value for US Steel is still rising quickly even though past earnings have already improved significantly.FEICBUYProjected value continues to rise for FEI while long term increases in earnings growth are also becoming more widely expected.ASBCBUYMany analysts are expecting higher than previously expected long term growth from Associated Bancorp, and its near-term earnings outlook is also improving....

more from Sabrient

Insider Scoop

Benzinga's M&A Chatter for Friday February 10, 2012

Courtesy of Benzinga.

The following are the M&A deals, rumors and chatter circulating on Wall Street for Friday February 10, 2012:

Actuant Acquires Jeyco Pty

The Deal:
Actuant (NYSE: ATU) announced Friday that it has acquired Jeyco Pty Ltd (“Jeyco”). Headquartered near Perth, Australia, Jeyco designs and provides specialized mooring, rigging and towing systems and services to the offshore oil & gas industry in Australia and other international markets. Additionally, its highly engineered products are used in a variety of applications for other markets including cyclone mooring and marine, defense and mining tow systems. Jeyco generates annual revenues of approximately $20 million.

Actuant shares closed at $27.33 Friday, a loss of 0.18% on average volume.

...

http://www.insidercow.com/ more from Insider

Market Montage

And Still Not a Single 1% Down Day in 2012

Submitted by Mark Hanna

Courtesy of MarketMontage. View original post here.

A little flurry of buying in the closing 5 minutes tacked on 2 S&P points and took the major indexes off the lows.  Only the Russell 2000 finished with a greater than 1% loss (1.4%) as it has been relatively weak versus the senior indexes for the past few sessions.   While today was the "worst day of the year" – it was quite a low bar as the previous biggest loss on the S&P 500 was -0.57%.

The S&P 500 held well above the 10 day moving average (didn't even really touch it) and did not even attempt to fill the gap from last Friday's employment report.  The teflon market rolls on for now.  Specul...



more from Mark

ETF Selector

ETFs Skid On Greece (VGK, EWG, FXE, DIA, SPY)

Courtesy of John Nyaradi.

Greece was “saved” for less than 24 hours but now major ETFs around the world skid into the weekend on Greek fears

After wangling for a week or more, Greek took their new deal to the European Ministers meeting, only to have it promptly rejected and so as we go into the weekend, major global markets and ETFs have again hit the skids on Greece.

After two years of wangling, the European zone is demanding yet more and deeper cuts for Greece to qualify for the next round of bailout loans that will keep the country from going bankrupt on March 20th.

Major European and United States ETF responded negatively to the new developments:

SPDR Dow Jones Industrial ETF (NYSEARCA:...



more from John

All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

more from David

Option Review

True Religion Falls Apart At The Seams After Earnings

 

Today’s tickers: TRLG, KR & IGT

...



more from Caitlin

OpTrader

Swing trading portfolio - week of February 6th, 2012

Reminder: OpTrader is available to chat with Members, comments are found below each post.

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here

Optrader 

...

more from OpTrader

Stock World Weekly

Stock World Weekly: The Relentless Pursuit of Meaningless Metrics

NEW: Elliott and Ilene are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's the latest Stock World Weekly, called "The Relentless Pursuit of Meaningless Metrics."  

...

more from SWW

IRA Strategy/Income Trader

Weekend Virtual Portfolio Update 1/30/2012

Here is a quick update of past trades and our current position. AA Money No trade this week as we wait for AA to settle. Phil remarked last week that AA seemed overvalued. In the meantime, it looks like we might have to roll our Feb 9 calls. Good thing we sold only 5 of them against our position. Last week P&L - 310.00 We lost ground last week, but we still have 11 months to sell premium! FAS Money Very good week for FAS Money as we benefited from the large amount of premium sold the previous week. We covered most of the shorts in advance of the Fed speech, but sold another set of options on Wednesday after the speech - 2 FAS calls that expired worthless on Friday, 2 FAS put that we are still holding and 2 FAZ put that we bought back for a profit on Friday. A late stick comparable to last week's almost gave us problems at the end of the day though! Last week P&L - $4277.00 IWM Money A decent week in this virtual portfo...

more from Strategies

Pharmboy

Biotech Investing for 2012

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Finding new and exciting Biotech companies that target novel mechanisms is like trying to find a needle in a haystack.  Sure there are many companies working on cutting edge science, but investing in those companies to reap the rewards of their work is a very dangerous game.  More often than not, companies fail because the mechanism does not pan out, the compound(s) do not have pharmacokinetics (get into the body or last very long in the body), or an adverse event happens that knocks years off a development timeline.  In addition, the stock can be manipulated by market makers so investors don't know which way is up.  I approach investing in biotechs as a long term prospect.  I continue to like our current portfolio of biotech companies (join in chat for many of those plays), and we continually add/subtract shares and sell/buy options on ...



more from Pharmboy



As Seen On:




About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

Learn more About Phil >>

About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the Favorites backup site (blogroll, archives, more). Contact Ilene to learn about our affiliate and content sharing programs.

Favorites Site >>