Posts Tagged ‘Tim Knight’

Timeframes and Actions

Latest thoughts by Tim Knight at The Slope of Hope

Timeframes and Actions

Since – and I’m being my typically overly-polite self here – some people seem confused as to my attitude toward the market, allow me to explain. Again.Short Term (Hours/Days)

  • Open to the possibility of S&P getting as high as 1120
  • Have opened up about 10% of intended short positions already. Vast majority of accounts in cash.
  • Have a small number of long positions, and a pretty big SSO position to soften the blow if the rise continues; occasionally briefly trading ES for pops and drops. Long /ES as of this writing.
  • Opportunistic day-trading ETFs when risk/reward seems heavily in my favor

Medium Term (Next Few Weeks) 

  • Think likelihood of trend change very strong;
  • Going through all stocks in advance and preparing target entry points and stop prices;
  • Intend to hang on to already-established positions and ratchet stops down as needed

Long-Term (Months/Years) 

  • Believe people who are planning on a new bull market are incorrect;
  • Think slow, grinding bear market will continue several years;
  • Believes major government policy shifts and social unrest will accompany bear market;
  • Will trade infrequently once bulk of positions are in place

Got it? Good. Thank you.

A Close Look at the Russell 2000

The /ES continues to grind uncomfortably and annoyingly along its descending trendline of resistance. It could, of course, pop above it at any moment. Given the fact the trendline isn’t even a week in length, a break above it wouldn’t be explosive, but it would be another carpet tack in the coffin of the bearish argument.Some might assume, based on my disposition, that I am massively short the market. I’m not. I have about 10% of my buying power deployed in short positions. I’ve got 3000 shares of SSO to ameliorate the market’s strength. I’ve been spending virtually all my time getting ready for, but not executing, the trades which interest me.The Russell looks like this right now:

1007-rut 
 

Operating in the favor of the bulls……… 

  • Broad uptrend still very much intact;
  • There’s about 8% upside from here before the major resistance at that rectangle
  • And, just now, AA reported earnings which the market seems to really like.

In the bears’ favor…….. 

  • Trendline breached;
  • Massive resistance overhead

Looking closer, we can see the series of lower lows and lower highs, but one good strong day higher could break this:

1007-rutclose 
 

 


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September’s Passing

September’s Passing

Courtesy of Tim Knight at Slope of Hope 
 

 

 


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DIG Near Breakout & Hedging My Bets

Note: Tim Knight is not ordinarily bullish is likely positioned for the downside as well.

DIG Near Breakout

Courtesy of Tim Knight at Slope of Hope

I’ve been mentioning lately how some folks are seeing inverted head and shoulders patterns where they don’t exist. Well, there’s one major ETF where it definitely does exist, and that’s the ultra-bullish energy DIG. It hasn’t broken out yet, but it’s geting tantalizingly close.

0922-DIG

The one curious aspect to this is that volume is steadily shriveling up (and, because the price has been so static, it isn’t because the price has been getting out of reach for people).

0922-DIGvolume

What are your thoughts on DIG?

Hedging My Bets

I am concerned about what fun and games are left in store for us the rest of the month, particularly with the FOMC tomorrow, so I am going to populate one of my accounts with ten longs as a safety net.

All of them basically look like the graph below………

0922-longs

………and share these common properties:

  • Plenty of "open air" on the upside;
  • A nice relationship between volume and price;
  • A clean breakout above a consolidation zone

The specific stocks, and their stops, are below. These are not "lottery plays", but more run-of-the-mill long choices.

  • AB 24.69 400 
  • AIMC 9.20 
  • BBEP 10.69 
  • CPX 10.14 
  • DRYS 5.86 
  • LLL 79.86 
  • PCX 11.57 
  • SD 12.42 
  • FMCN 8.83 
  • HERO 5.63 

 


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Everything’s Coming Up Roses

Everything’s Coming Up Roses

Courtesy of Tim Knight of Slope of Hope

As regular readers know, I’m counting on a countertrend top between 1050 and 1200 on the S&P, and we’re within spitting distance of it. Today’s high was barely 1% underneath 1050. I maintain my belief that this is nothing more than a countertrend rally unless (God forbid) we were to cross above 1200.

The folks over at Elliott Wave provided a very interesting graph on sentiment today:

0824-optimism

Not to put too fine a point on it (.…..say I’m the only bee in your bonnet…….), investors are now even more doe-eyed optimistic about the prospects for equities than they were when the S&P peaked at 1576! All this crap about tons of cash on the sidelines and people waiting to pile into the market is just that: a load of crap. They’re already in! And they’re expecting things to keep soaring! (Just like, ummm, in October 2007).

The "cash on the sidelines" thing drives me nuts. The "cash" was destroyed in the 58% decline – remember? The notion that people:

  1. Sold at the top
  2. Tucked their "cash" away somewhere really, really safe
  3. Now have all that cash at-the-ready to buy stocks

is…….that’s right!…………utter crap.

It’s lovely that today was a good day for me, but I’ve been through the past five months and know it doesn’t mean squat. You know the last time we had a good, solid down week? June! So it pays to take it one day at a time and assume Goldman is just playing games with us all until things start to seriously, seriously crack.

And, I assure you, ladies and gentleman, that is a day to which I eagerly look forward.

****

Song for Tim :-)

 


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Yes, Virginia

Yes, Virginia

Courtesy of Tim at Slope of Hope

Sloper Virginia Jim posted a chart so danged beautiful I’m going to show it here (plus I am frantically doing a zillion things and don’t have time for an original thought of my own!) I hope VJ doesn’t mind me sharing:

0810-virginia


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H&S, R.I.P.

A tired and battered bear lays the beloved H&S chart pattern to rest and gathers up the will to take on the somewhat repulsive task of climbing the Slope of Hope.Ilene  

H&S, R.I.P.

Courtesy of Tim Knight at Slope of Hope

Well, this pattern had a lot of promise, but it’s dead, Jim.

0715-spx1, spx

So here is a broader view of the S&P cash market:

0715-spx2, spx

The bulls own this market now. For the bears to take over, the S&P would have to blow below this month’s lows (around 875). The odds of that happening went way down over the past few days. 875 is very strong support, we can plainly see.

The huge yellow zone shows that there is very little in the way of the bulls ultimately being able to push this market to about 1,150. They will have to get past about 975 first, though (circled above), since that is the underside of a major broken channel. It also seems that every attempt to make a higher high does succeed to get a little higher, but then it starts faltering again (June 11th being the most recent example).

A lot of people have been writing to me about sentiment. I respect the value of sentiment indicators, and I generally agree that until we get to the point where the public is absolutely convinced that Happy Days Are Here Again, it will be very tough (still) to be a bear.

I just read the Elliott Wave Short Term Update, and they’ve pretty much thrown up their arms and have said an S&P between 1,000 and 1,100 is in the cards. From a big picture perspective, as I’ve said repeatedly, having the S&P in the quadruple digits in September would be a marvelous opportunity. My problem is that, frankly, I had such a blast trading between October and February, I got used to cashing in heavily on downsweeps, and I’ve been looking for them ever since. It’s been an uphill battle, and it’s exhausting.

Although lottery longs are getting more and more sparse, they are still out there. My 401-k hit a new high today, and that was even after I saddled it down with a big DUG and TWM position in the middle of the day. Rinky-dinky stocks that can climb double digits in


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Phil's Favorites

Companies promoting causes can be accused of 'wokewashing' - allying themselves only for good PR

 

Companies promoting causes can be accused of 'wokewashing' – allying themselves only for good PR

Ben & Jerry’s opened Art for Justice, which highlights the need for criminal justice reform and features art by formerly incarcerated artists. AP Images/Andy Duback

Courtesy of Kim Sheehan, University of Oregon

More consumers want companies to ...



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Zero Hedge

Google Slides After Antitrust Probe Expands Into Search And Android Businesses

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Google shares are sliding into late session after a CNBC report states 50 attorney generals are expanding their investigation into the technology company's search and Android businesses:

  • 50 ATTORNEYS GENERAL PROBING GOOGLE PREPARING TO EXPAND ANTITRUST PROBE BEYOND CO'S ADVERTISING BUSINESS - CNBC

  • 50 ATTORNEYS GENERAL INVESTIGATING GOOGLE PREPARING TO EXPAND ANTITRUST PROBE TO DIVE MORE DEEPLY INTO CO'S SEARCH & ANDROID BUSINESSES- CNBC

The investigation is being led by Texas Attorn...



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The Technical Traders

Great Cycles Article PG 9 in TradersWorld Mag - Free

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Digital Currencies

Is Bitcoin a Macro Asset?

 

Is Bitcoin a Macro Asset?

Courtesy of 

As part of Coindesk’s popup podcast series centered around today’s Invest conference, I answered a few questions for Nolan Bauerly about Bitcoin from a wealth management perspective. I decided in December of 2017 that investing directly into crypto currencies was unnecessary and not a good use of a portfolio’s allocation slots. I remain in this posture today but I am openminded about how this may change in the future.

You can listen to this short exchange below:

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Kimble Charting Solutions

Silver Testing This Support For The First Time In 8-Years!

Courtesy of Chris Kimble

Its been a good while since Silver bulls could say that it is testing support. Well, this week that can be said! Will this support test hold? Silver Bulls sure hope so!

This chart looks at Silver Futures over the past 10-years. Silver has spent the majority of the past 8-years inside of the pink shaded falling channel, as it has created lower highs and lower lows.

Silver broke above the top of this falling channel around 90-days ago at (1). It quickly rallied over 15%, before creating a large bearish reversal pattern, around 5-weeks after the bre...



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Chart School

Gold Gann and Cycle Review

Courtesy of Read the Ticker

Gold has performed well, golden skies are here again. In fact it has been a straight line move, and this is typically unusual and a pause can be expected.

It seems the markets are happy again, new highs in the SP500, US 10 year interest rates look to re bound, negative interest may soften. The US FED has reversed their QT and now doing $250BN (not QE) repo. The main point is the FED has stopped QT, and will do QE forever. The evidence now is the FED put is under market risk and the possibility of excessive losses do not exist. 

Point: If in future if there is market risk, the FED will print it's way out of it.
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Lee's Free Thinking

Today's Fed POMO TOMO FOMC Alphabet Soup Unspin

Courtesy of Lee Adler

But make no mistake, if the Fed wants money rates to stay down by another quarter, it will need to imagineer even more money.

That’s on top of the $281 billion it has already imagineered into existence since addressing its “one-off” repo market emergency on September 17. This came via  “Temporary” Repo Man Operations money, and $70.6 billion in Permanent Open Market Operations (POMO) money.

By my calculations that averages out to $7.4 billion per business day. That works out to a monthly pace of $155 billion or so.

If they keep this up, it will be more than enough to absorb every penny of new Treasury supply. That supply had caused the system to run out of money in mid September.  This flood of paper had been inundati...



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Biotech

The Big Pharma Takeover of Medical Cannabis

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

 

The Big Pharma Takeover of Medical Cannabis

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How IPOs Are Priced

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Funny but probably true:

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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

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