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13-09-2009, 07:24 PM
#501
A77, too small to read. Can you pls post a larger one or a link? Cheers.
Having got ourselves into a debt-induced economic crisis, the only permanent way out is to reduce the debt – either directly by abolishing large slabs of it, or indirectly by inflating it away.
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14-09-2009, 08:09 AM
#502
Originally Posted by Dr_Who
A77, too small to read. Can you pls post a larger one or a link? Cheers.
...the text:
>
My partner Kevin Lane is fond of saying “Stock price direction is a function of several factors; valuation, future expectations, sentiment and liquidity.”
That last component, liquidity, seems to be most dominant lately since buying power (or lack thereof) determines if stocks go up or down.
Typically, liquidity is strongest when expectations are the most negative and people have already dumped equities; It is weakest when expectations are most optimistic.
Why? At market tops, investors tend to be “All In” — their expectations for the future are most optimistic, and that means their liquidity is spent. By the time investors go “all in,” things are about as fundamentally bullish as they are ever going to get, and stocks are fully valued. Indeed, at these “all in” junctures, valuations are typically highly stretched, with no room for earnings misses or weak forecasts.
With investors “all in” there is no buying power left in the aggregate to push stocks higher. The opposite occurs at bottoms: Investors become so pessimistic about the future they move large amounts of cash to the sidelines. We get the added benefit at this point as valuations typically have contracted as well and are now attractively priced.
With large sums of cash moved to the sidelines, valuations attractive and selling exhausted, there is no where to go but up — even if its only for a period of weeks or months.
The chart above looks at how far above or below the 21-year average allocation of 60 % invested in stocks individual investors are presently. As seen above when stock allocations drop 15 % or greater below that 22-year mean, (red circles) which has occurred only 3 times in the last 22 years (1990, 2002 and late 2008/early2009) it has equated into significantly higher stock prices 3/6 months up to several years later.
Even given the extent of the current rally, investors remain 6% below their mean allocation to stocks, and significantly below fully invested levels of 10-15 % above the mean. Sideline liquidity remains strong, investors are still not fully invested, and dips have remained fairly contained.
Anecdotal sentiment also echoes the under-invested theory as most investors expect a correction and refuse to invest as the market melts up. Typically investors talk their positioning and under investment breeds statements of caution.
Kind Regards
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14-09-2009, 10:22 AM
#503
The AAII (American Association of Individual Investors) has some good stuff on their website.
Have to join to see the stuff though..there are 3 levels of membership one level is free and this level has some good free stuff in it (incl some investor software)..so worth the 5 minutes it takes to join up.
Last edited by Hoop; 14-09-2009 at 10:24 AM.
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15-09-2009, 07:31 AM
#504
...SPX 500 seems consolidating beneath the 11 month High set Fri September 11th *1048 in a range most likely featuring the Sep 10 Congestion *1026 and *1050 barrier.
...assuming *1026 is successfully defended, the market will likely break-out and deal with the Oct 7 High *1072 and the 50% retracement of the 2008-2009 Break *1119 further up
...on a cautious note, a market top becomes more and more likely as the index pushes towards the 50% retracement of the 2008-2009 Break *1119
Trading Strategy: sideline (safest);
-hedge: neutral to bullish bias to *1018/*1044/*1100; no equity exposure;
-hedge: short 10% equity covered; short bias (+); with equity exposure;
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
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15-09-2009, 09:57 AM
#505
The 1005 breakout of the S&P500 a month ago has been confirmed by the DOW this morning...but only just!
This is bullish (and technically important) news that hasn't been widely communicated from the media today.
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15-09-2009, 10:48 AM
#506
Nice chart Hoop
More I look at it surely the DOW has to continue on its current trajectory to 12000 ... and then slowing down a bit as it heads to 14000
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16-09-2009, 07:29 AM
#507
(12:07) Almost there, 10-yr back to a 3.424% yield
(10:26) Coming back following SFEF $4.5B 5-yrs
(9:55) Pulling back from lows, but 10s may make run at 3.495%
(8:12) Tempering sell-off, but pressure remains
(8:34) Sold off on run of better data with the curve swinging steeper still
---Core PPI: Actual 0.2%, consensus 0.1%, prior -0.1%
---PPI: Actual 1.7%, consensus 0.8%, prior -0.9%
---Retail sales: Actual 2.7%, consensus 1.9%, prior -0.2% (revised from -0.1%)
---Retail sales ex-auto: Actual 1.1%, consensus 0.4%, prior -0.5% (revised from -0.6%)
---Empire Manufacturing: Actual 18.88, consensus 15.00, prior 12.08
---Business inventories: Actual -1.0%, consensus -0.8%, prior -1.4% (revised from -1.1%)
---Fed bought $2.049B of $7.004B
Advancing issues outnumber decliners by roughly 3-to-2 in the S&P 500, helping the benchmark index preserve its gains. Of its 10 major sectors, eight are trading higher; only health care (-0.8%) and consumer staples (-0.7%) are in the red. Materials, now up 2.2%, continue to sport the best gains.
Airline stocks are also performing exceptionally well this session. In turn, the Amex Airline Index is up 3.5%.
...SPX 500 mildly higher so far and as long as Monday's 14th September Low *1035 holds, the market will likely break-out and deal with the Oct 7 High *1072 and the 50% retracement of the 2008-2009 Break *1119 further up
...on a cautious note, a market top becomes more and more likely as the index pushes towards the 50% retracement of the 2008-2009 Break *1119
Trading Strategy: sideline (safest);
-hedge: neutral to bullish bias to *1018/*1044/*1100; no equity exposure;
-hedge: short 10% equity covered; short bias (+); with equity exposure;
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
Last edited by ananda77; 16-09-2009 at 07:31 AM.
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17-09-2009, 08:24 AM
#508
Looks like the markets will trek higher.
Having got ourselves into a debt-induced economic crisis, the only permanent way out is to reduce the debt – either directly by abolishing large slabs of it, or indirectly by inflating it away.
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17-09-2009, 08:41 AM
#509
Ending on a high is a good sign as well eh Dr Who
That chart of Hoops is looking even better --- DOW at 1200 by Xmas at least .... you can see the formation forming nicely
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17-09-2009, 11:01 AM
#510
...US Bonds
(13:24) Backed off some with long end still leading
(11:14) Clawing back in lightened trade
(10:33) Trading off hard with the 10-yr taking out the 3.485% and looking at 3.495%
(9:43) Back to negatives with a size spike in size
(8:21) Bonds back off highs following run of data
Core CPI: Actual 0.1%, consensus 0.1%, prior 0.1%
-CPI: Actual 0.4%, consensus 0.3%, prior 0.0%
-Current Acct Balance: Actual -$98.8B consensus -$92.0B prior -$104.5B (revised fro$101.5B)
-Net Long-term TIC: Actual $15.3B, Consensus $65.0B, prior $90.2B (revised from $90.7B) -Capacity utilization: Actual 69.6%, consensus 69.0%, prior 69.0% (revised from 68.5%)
-Industrial production: Actual 0.8%, consensus 0.6%, prior 1.0% (revised from 0.5%)
-Fed bought $1.799B of the $16.391B in the 2010 to 2011 maturity range
...NYSE Data (see attachment)
...SPX 500 Close *1068
-new 11-month High-
-immediate additional upside to Oct 7 High *1072 (+)/ *1082 likely
- bearish divergences in daily momentum appearing
-risk of a minimum shake-out back to *1027/*1035 congestion increasing
-downside risk versus upside potential becoming unfavorable short to medium term
Trading Strategy: sideline (safest);
-hedge: neutral to bullish bias to *1018/*1044/*1100; no equity exposure;
-hedge: short 10% equity covered; short bias (+); with equity exposure;
Long Term: THE BEAR
_no guarantees and trading strategies are just ideas_
Kind Regards
Last edited by ananda77; 17-09-2009 at 11:02 AM.
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