YUCKO

Bryan Marsal has my vote to be the "Financial Czar" of the US, http://www.ritholtz.com/blog/2009/07/unwinding-lehman-brothers/ .

6:46pm: THIS, could explain the extra 15 minutes of trading on thursday, did the Goldman trading platform code get hacked, hahahahahahahahahahahahahahahahahaha???? http://zerohedge.blogspot.com/2009/07/is-case-of-quant-trading-industrial.html?dsq=12182382#comment-12182382

My God, every body, and I mean E-V-E-R-B-O-D-Y, is talking about the stinking head and shoulder's on the DOW and SPY. Like I mentioned in the post back on 6/27, with every body looking at some thing, there is just no way in hell, NADA, ZILCH chance, that it's going to happen (TA-DA, there, I just guaranteed it will happen, hahahahahaha!!). I didn't mention the NasDog's, some times called da Q's, as they are in their own little world right now. It seem's every one is convinced that AAPL, RIMM and PALM are all going to be coming out with new edible cell phone's, which will be really cool, as all those poor soul's waiting in the soup lines will be able to take some of the hunger edge off, as the line's will probably be quite long. Beside's, they won't need the stinking phone's anyway, there won't be anyone to call to see if they have any work available. Stupid Dog's.
Anyway, with me interrupting the Blog's vacation time, it's obvious that I'm very interested in what's going on, I'm hoping we have a huge move coming up, and we get out of this obnoxious range. The first thing I notice on the chart above, is that after the big down day on Thursday, the RSI2 at .42 and the STOCH at 3.26 are both very over sold, and the CCI diverged against price all day Thursday, SO, we "COULD" get a bounce coming up, to relieve that situation. The whole key to how this pattern play's out, is what DA NEW BOYZ think they need to do, in order to hurt as many player's as possible, DA NEW BOYZ being JPM, GS, MS, BAC, and C, as the PPT is now using them as their new conduit for our tax money, being used by Tax Cheating Timmy and Uncle Ben, to try and hold the market's up, as talked about numerous times at Zero Hedge. It's just possible that the mysterious extra 15 minutes of trading time that the NYSE, in it's infinite wisdom, decided to add after the end of trading on Thursday, before a holiday mind you, was engineered by the PPT to load up at lower levels, in order to drive us higher out of the chute with the open of futures tonight, chasing any idiot misguided short's that loaded up going into the close. That may result in the light blue senario in the chart below, with the ? mark on it, although for the life of me, with the volume we've been having, I don't see where they could get the short covering they need to take us higher, although with JPM trading over 3 million contract's at a wack by themselves, they could probably do it alone. I should probably mention that if "they" take us over the high from wednesday, the whole pattern is negated and we go into another trading range for the next six months.

This is a "POSSIBLE" senario I'm looking for, this is the Tony OZ setup for playing head and shoulder pattern's, Tony of course was the individual that the book "The Wizard of OZ" was originally written about. First off, the black (1) and (2), is the Elliott wave count that a lot of the waver's are looking at, such as http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID1606987 , so, if that's a true count, we "could" have the wave 3 down coming, which is ALWAYS the longest wave, which would negate every thing I have up there, as we just go crashing through the neck line into the depths of hell, to eventually fill my target for the SPY of 5 bucks. A note about the neck line right here, there's an unfilled gap from May 1 at 88.07 waiting for us, so that is the MAJOR number right now.

Now, beside's the H & S, this thing is also a descending triangle, which, in my simple little brain, (as one of my commentor's so eloquently pointed out), make's it easier to try and figure out. These thing's usually get a five count, waver's also use an a-b-c-d-e count, wad ever, the KEY point, naturally, is number 2, that's where all the action is going to happen. Tony's whole theory, and I agree, is that we break the neck line, which get's all the Jonny come lately to the rally selling like crazy, the bear's pile in, including the Elliott waver's who think we are getting the wave 3 down rolling, and then, "magically" (can you spell PPT???), we start back up. This set's up the "true" short, and that's at point 3, in the circle, when we go back up and test the upper limit of the triangle. It dosen't matter where you take it at that point, that would depend on your "risk" parameter's, me, I would probably want to see some kind of candle topping pattern, or some thing, hopefully, like when we get there, we are also over bought again.
Now, if this thing works (hahahahahahaha, fat chance Gomer) at point 3, I would personally throw out points 4 and 5, for if the bear's get their Mojo going, we may just go through point 4, I'm only showing them in case they decide to drag us out some more, and frustrate as many as possible, which is extremely likely, as I anticipate that we probably grind around inside this thing during earning's season, before breaking down, maybe into August.

A few note's here, about failure pattern's on this thing. The first one is at point 2, there's a chance, however small, that we just blast right through it, in which case I will miss it, as I'm not jumping into a meat grinder short at that point. My preferred take on this whole thing, is the green line's and circle over on the far right, this can happen at ANY point, 2, 4, or the break down after 5 like I show it. If we break through 2, there's about a million to one chance that we came back and "BACK TEST" the break down point of the neck line, around 88, this, to me, would be the best chance to get a relatively decent low risk short entry. If we go back up through the 88 "area", and stop out, we "may" back test the (1) "area" again, which would provide another low risk entry.

Another thing, I just have simple little line's on the chart, naturally we are actually going to be all over the map on the actual candle's and price chart's, this is just a map, of sorts. The one thing that would negate the whole fricking pattern, is if we stop at one of those support level's at the thin red horizontal lines, set up another low pivot point, and start back up before testing the neckline, there's a high probability we do that, as that would TOTALLY frustrate and screw with every one's mind. If that happen's, I would just move the triangle UP, with the neck line at what ever NEW bottom we have, and start over with the same count, with a narrower triangle.

There's another senario as well, and that is that this whole thing is a huge trap, and the count is wrong. The correct count in a trap, would be that the current point 2, is actually point 1, which mean's that point 5, rather than being on the upper edge of the triangle, would be on the neck line, in which case, we would get a huge trap with a break of the neck line at point 5, and then turn up and go blasting through the upper line of the triangle, never to see these level's again in my life time.
Another thing I will be watching, is if we break out over points 3 or 5, which would stop me out on a short. There's a good chance we could continue up at that point, in which case I will be watching for the REVERSE of the green line's and circle, in order to get long, which would be a back test of the upper line of the triangle.

Anyway, I'm really getting interested here, I see a whole shit pile of way's I can lose money, Woooooooo Hoooooooo!!!!!!!!!

Weekly MSW

The Weekly MSW scan has about three time's more new short's on it, than buys. It wants to buy the TZA, the small cap 3X bear fund. It also wants to buy the new VXZ, with is a future's buy on the VIX, which fit's with the bearish view. Interestingly (at least to me), it make's a perfectly logical buy, it says buy the UltraShort crude index SCO, and, buy the Airline index FAA, hahahahahahaha, make's sense, if oil goes down the airlines will go up, at least temporarily, before every thing get's crushed. It still love's the Euro, it wants to buy the Rydex Inverse fund REC, and the UltraShort Utility fund SDP. As far as new shorts not shown, it wants to short the base metal's BDG, plus SLV and GLD, it hate's shipping SEA, the world market's VT, the large cap 3X bull fund and the small caps, BGU and TNA, TIP, meaning it dosn't think inflation is coming, at least for now. Some notable short's on stocks include JPM, MCO, SNDK, QCOM, CERN, TSON, CCMP, OSTK, MOS, AMTD, MA, LD, DECK, NEM, EXPD, DIS, SHLD.

There's a bunch more ETF short's as well, check them out your self.

The daily scan came up with some interesting trade's, it says to buy short term bond's, which fit's with Bob's bearish view I mentioned friday night. It also has a buy on one I hadn't heard of, QAI, which is a Multi-Strategy hedge fund tracker. It want's to short the Ultra Short material index, UYG, and gasoline, UGA, THANK GOD, is the gas run up over for this summer?????

Naturally, just double click the chart's and you get the full view.

WHAT IN THE HELL IS THIS?????????

This past week had the lowest volume of advancing issues, on a weekly closing basis on the NYSE, EVER, since the great recession started, FAR AND AWAY THE LOWEST VOLUME!!!!! I drew line's down to the SPX on any previous close's under 300, and circled the area on the SPX where the market continued to advance in the face of these declines, it happened about a half dozen times, out of the current 20 times this has occurred, but as you can see, the advance's were a little anemic at best, and four of those time's it happened after the market had fallen, not coming off a current high.

There were a couple of time's when the ratio of advancer's to decliner's was lower, in the two circles in July/August of 07' and March of 08', and the market advanced upward after those two times, but again, they occurred after a market decline, and after we were starting to advance.

This, like, totally freak's me out man, I don't know what to make of it.

MSW Core Portfolio Stat's

One thing I do with the MSW is run a Core Portfolio testing strategy with it, in this case it's based on the signal's generated by the MSW on the daily time frame, with the "DEFAULT" systems, the signal generator that use's 59 different trading strategies to generate buy's and short's, or sell's if you want to look at it in that manner, but the results are based on shorting a stock when the short signal is generated.

Now, the report, and the result's, are based on signal's generated back to January 1 of 2000, and the results of course, are based on taking each and every trade when the signal is fired off. If you took each and every trade, the average APR for the period is 51.2%, BUT, this of course, is entirely misleading, as this is based solely on the trade's made on the various stock's that fired signal's in each yearly period, and not on an allocation schedule that you would have to determine, your self, to each and every trade. I plan on doing some thing like that, on a testing basis, but is going to take a LOT more time. Also, a lot of the ETF's in the study have not been around very long, so there's not much of a track record in them, although I have to say, on a PERSONAL basis, I have been doing all right with stuff like HYG and JNK, but that's just a personal thing, I find bond's pretty easy to trade, eeeeeeeerrrrrrrrr, "INVEST", in.

The more important thing that jump's right out at me, is that I can throw out over half of the stocks right off the batt, by just looking at the stat's, mainly by starting with the APR. It can't trade INTC, IYR, CAT, SSO, MOO, or IBM, worth a crap, or, for that matter, it trade's the Q's a lot, but only generated a 14% return, so, forget it (well, actually, I guess you "COULD" use the signals, it's just that the results pale in comparison to some of the others).

It made decent money on some of them, but only generated a very small number of trades, like, MSFT for instance, there was only two trades in 9 years, but it hit both of them.

One thing it has been doing, is picking up on some of the newer ETF's, like DBC, DGP, DXO, EFA, and trading them quite well. It also seem's to love trading AA, AAPL, GLW, GNK (which has a great dividend), and GS, meaning I should concentrate my effort's in those stocks.

One way to pick up on stock's like these, that it trade's well over longer periods of time, is to run the Russell 3000 through it, with a filter on the APR as the signal generator. I don't do this right now, because it take's so long to run the test's, like, the normal MSW I show on the weekly scan has a test period of 600, meaning the test's only go back about two year's, rather than the nine year's I run on this Portfolio. I plan on doing this at some point, when I can find the time, I'm just so damn busy this summer, I haven't gotten to it yet.

?

Just fooling around, but I guess, if Bob is talking possibly about the FXI below, I guess you could, IN THEORY, make a case that it could go to zero. It has pretty strong resistance at 40, so maybe it's capped off here, and over the next few month's it "COULD" set up a head and shoulders. I have the neckline above at about the 22 level, which is about 18 points down from the 40 level, which would give you a target of 4 bucks. BUT, if he's looking for a neckline at that 20 level, then, yea, you could say that it "COULD" go to zero, as that would be 20 bucks off the 40 level, and then the equal projection would be another 20 bucks down from the neck line, or, aaaaaaaahhhhhhhhh, ZERO, hahahahahahahahaha!!! Good Ole Bob.

7/3 5:15pm: Hahahahahahahahahahahahahahahahaha!!! Robert McHugh is certainly cheery this weekend!!!!!! Geeze, and I thought my little fun chart below was evil, HAH! This is his comment's in his latest attempt to get me to re-subscribe:


"We have identified a potential dangerous pattern in several international stock market indices, which we present in this weekend's expanded market newsletter to subscribers, available at the weekend button at http://www.technicalindicatorindex.com/ . How dangerous? If they become confirmed patterns, we are talking about downside targets near zero. This is not to be alarmist. At this point, these are possibilities, not probabilities. In this weekend's newsletter, we discuss where prices have to head for confirmation, which would mean the probability of these downside targets being reached becomes high.

The situation at this point is similar to standing outside, and seeing some of the darkest clouds you have ever seen gathering over the horizon. Will a tornado accompany this storm? Will the storm veer off and miss us? Do not know at this point, but the risk is there.

These dangerous patterns are about 80 to 85 percent complete. We urge you to study these charts on pages 20 and 21 at the Weekend button at http://www.technicalindicatorindex.com/ and plan accordingly.

With the modern interconnectedness of international markets and economies, these patterns are alarming for U.S. as well as international investors. "

He has an interview with Jim PupLava on Financial Sense this weekend, http://www.financialsense.com/fsn/main.html , I haven't listened to it yet, but I plan on it. They also have Peter Schiff on the show, with Bob in such a bad mood, I can't imagine what Pete's going to say, hahahahaha, woooo weeeeee!