And the Winner is----- SURPRISE!!

AAAAAARRRRRRGGGGGGHHHHHH!!!!!!! That damn Baltic Dry Index!!!!!!!!! Every time we are, SUPPOSED, to have some thing going, IE, GROWTH, that damn BDI is saying some thing, ENTIRELY, DIFFERENT!!!! SIGH! It doesn't bother me, but, of course, I have a position in that stupid DRYS, hahahahahahahaha! Wad Ever! I am NOT EVEN, going to tell you, about how you NEVER, hear any of the yellling screaming yakkking fricking talking analyst heads, on the TV shows, how NONE of them, EVER mention, the BDI! It's not hard to figure out why they don't mention it, it doesn't fit their babbling bullish commentary.
Sigh, well, maybe it will find support at that 200 DMA again, like it did in September.

Another thing that Bug's me, Maaannnnn, is how I can't find any data, UP TO DATE, on the number of VACANT homes in the US! This is typical, http://www.housingbubblebust.com/HsgData/CB/Existing/USHsgVacant.html , that's from last February, I've found more articles up to April of this year, but for some, STRANGE REASON, all the posts stopped, about the 19 miiiiiillllion homes, sitting vacant in this country. I bring this up, because of course, when "they", give the housing data each month, and say, LOOK, SEE, the "INVENTORY", dropped to 10 months, 9, 8, WAD EVER, they NEVER, talk about those 19 million homes sitting vacant, because the Big Banks, refuse to take their losses on them, IE, they are just sitting on them, willing to hold the inventory, as long as WE, the TAXPAYERS, are paying them to do so. That, and of course, our maaaaaaavelous Government, told them they could hold them in OFF BALANCE SHEET ACCOUNTS.

I'm not sure I should post this email from Larry Levine or not, but I assume he can use the advertisement, anyway, it reminds me of how bull headed and focused I can get, as I haven't been looking at the gap situation, other than my typical manipulation conspiracy nut stuff, and my own personal experience, has been that I've been doing all right with the situation, being on the right side at the open. I will say, that all most ALL my trades, have been made in the first half hour, for quite a while, like covering short puts, and then reselling after the first reaction, or gap fill attempt. Hmmmmm, anyway, I thought the article was very good, and I guess Zero Hedge had an article about this very same thing, claiming almost all the gains the last few months, have come from the Goldman manipulation of the over night markets:

Larry Levin's Nightly Newsletter & Trading Signals
Gaps

Have you noticed how often the market gaps open, higher of course, then does nothing all day? Said another way; have you noticed when the market closes that nearly 100% of the net gains had been put in...but at 9:30am EST? One wonders why the market opens at all some days.

In the "Secret's of Traders" course we identify different day-types that estimate what sort of trading environment we're likely to see, such as a trending or very choppy day...or something in between. The "#4-day" is the non-trending type of day that is constantly reversing directions into the close. This is great information to have when you know how to adjust to it; however, it gets a bit frustrating when each day is the same as the last. This month has had the greatest number of #4 days - EVER.
All of this leads me to a very interesting article I read at ZeroHedge which follows. They finished a study that shows 100% of the markets recent gains have come from the overnight market (gap opens) and without them, the market would have been flat for three months. http://www.zerohedge.com/article/three-month-flat-market-yesif-you-exclude-constant-after-hours-manipulation#comment-172925

Anyone looking at their 401(k) portfolio performance since the end of August will undoubtedly be very happy (and extremely surprised), as the market has climbed steadily higher despite i) increasingly declining trading volume and ii) consistent and material withdrawals from domestic equity mutual funds. Furthermore, if anyone was merely looking at the trading action in regular hours, one would think there was absolutely no profit made since early September. The reason for that: all the upside since September 14th has come exclusively from after hours action. The chart below demonstrates the relative performance of regular hour trading in the SPY as well as that in the extended session. The notable observations: gaps, gaps, gaps. Every single day, minimal volume pushes the futures index higher. Good news, bad news, it don't matter to the Goldman S&P and Russell 1000 futures desk: they just lift every micro offer, giving the impression that the market is unstoppable, often leapfrogging each other as the latest viagra'ed GDP or unemployment rumor is spread. Come morning, it is time for the HFT brigade to come in and scalp their trillions of pennies while leaving the market unchanged, then at 4pm handing it off again to leveraged futures manipulation and dark pools. In a nutshell, this is the secret of the past quarter's phenomenal market performance. http://www.zerohedge.com/sites/default/files/images/user5/imageroot/volcker/Regular%20%2B%20AH.jpg

A longer-term chart highlights the regime changes since the March lows, when for several months in a row, regular hours would carry the broader market higher, then would flatline, and let the futures trading desks take over. Rinse. Repeat. That way both the HFTs and dark pools end up happy.http://www.zerohedge.com/sites/default/files/images/user5/imageroot/volcker/ES%20Regime%20Change.jpg

The observant among you will immediately realize what this implies: not only is there no volume breadth to the recent move in the markets, but the actual push higher likely occurs on at most tens of thousands of futures contracts on a daily/weekly basis. The fact that literally several blocks of AH trades, used persistently, can move the market higher by 6% over the past 3 months, even as regular trading accounts for absolutely no part of this move, and that the SEC finds nothing troubling about this phenomenon, should be sufficiently telling about how "efficient" US markets have become.

The reason for this focus away from regular hours trading is simple: all After Hours does is provide leverage due to the much shallower trading overnight. Zero Hedge is currently finalizing ES volume data to determine just what leverage the futures desk as JPM and Goldman uses in their interminable push to make the Dow 36,000, working title of "EV/EBITDA = Infinity (Or Better Yet, Negative)? Who Gives A Sh*t: The Fed Has You Covered", the bestseller it was always meant to be.

Oh, by the way there was more economic data today. Consumer's sentiment was less cheerful than expected and new home sales were in a word: terrible.
New home sales toppled like a drunk at an open bar! New home sales crashed 11% in November to a 355,000 annual rate, which are 60,000 below low estimates! The hit includes downward revisions of 42,000 to the prior two months, which means the prior data were either put together by incompetent government boobs or were simply lies. No surprise there.
If that wasn't bad enough, the crash in housing starts wasn't enough to keep down November's supply which stands at 7.9 months and is UP from 7.2 months in October. It would be hard to imagine a worse report for housing at the moment.

Market reaction? Yawn. It closed closely to its open so the overnight buying desks of Goldman and JPM goosed the daily gain again.

Bill Luby at http://vixandmore.blogspot.com/ , posted an article from CXOA, http://www.cxoadvisory.com/blog/internal/blog12-22-09/ , about a simple sector rotation strategy, that out performs buy and hold in the SPY by quite a bit. You simply go all in at the end of each month, in the sector that has performed the best, over the last six months, Woooooooo Hoooooooo, nothing to it!!!!!! Hahahahaha, I wish every thing was that simple, but, HEY, you can't argue with the results. CXOA had a number of other articles, along the same lines, that would be worth reading over the Holiday weekend.
ANYWAY, as per the list above, THE WINNER IS: XLY, Consumer Discretionaries!! Surprised the heck out of me. I guess it make's sense, the rich and POOR keep getting richer, while the middle class keep's getting their asssssss kicked, so only the people that have money, are spending money.

Futures are, another SURPRISE, "UP", this morning, as weekly Yobless claims came in slightly lower than expected, DOW up about 24 points, which with the new paradiam of selling good news, you'd think we'd be down, but I guess the piss poor Durable Goods report helped to provide some bullish momentum, as it came in more than 50% lower than expected, HEY, IT'S ALL GOOD!!!

Unless I'm having so much fun this morning, that I find a setup to post about, this may be my last post for awhile, as I leave early in the morning tomorrow, for my youngest son's house in Sparks, NV, a nice 10 hr. drive on the coldest morning of the year so far, I don't know how much black ice is waiting for me out in the middle of now where, on HWY 50, the LONLIEST HIGHWAY IN AMERICA, but I'll do my best to find out! We are only open a half day today, and I EXPECT, we will be DONE, after the first half hour.
Anyway, everyone have a HAPPY HAPPY!!!

RATS, already a PS: I ran the same screen through my SECTOR WATCH LIST, that I use for the weekly money flow posts, and ACTUALLY, IN A REAL SURPRISE, the BEST SECTOR, and, ASSET CLASS, the last six months, has been REAL ESTATE, hahahahahaha! IYR leads in momentum, followed by metals and mining, XME, then the transports, IYT, and THEN XLY. Naturally, it would be interesting to see the same kind of strategy performance results, when applied to an ASSET CLASS momentum method on the monthly basis, or maybe a combination of the two. Maybe one of you brianiac's will have enough interest to run your own test on it, over the coming days, and see what you come up with.

12/23/09

THE SANTA CLAUS RALLY LIVES!!!!! Hahahahahaha! I have to admit, that daily chart at the top, of the Q's, is looking a little, aaaaahhhhhh, FROTHY! Four gap up's in a row, at least today we filled the gap before moving up, by ONE lousy cent, we still have open gaps from the rest of them. The more I look at that gap up on last thursday, the more ridiculously manufactured it looks to me, but, HEY, that's just me, don't let that keep you from buying the shit out of them.

Surprisingly, the daily chart is actually not as over bought as the weekly chart, which doesn't say much for the weekly chart. We're getting a little over bought on the STOCH, but the RSI still has room to go, and the most interesting part, is that the MACD has just now signaled a stinking BUY, can you believe that???

The bottom chart is my 60min McCellan chart, and we actually have room to move higher, over +100 and we start getting a little over bought, it's at 86 right now, but I've seen it get to +200 many times, so it still has room to go higher (IE, MORE, over bought, hahahaha). We are JUST about bumping up against that trend line I talked about the other day, but we have a little more room to go. What may happen, is we get to the trend line, and then just start "WALKING" up it, IE, going higher, getting more and more over bought, while the yelling screaming yakking fricking talking TV heads, start screaming louder and louder, about how cheap the market is, and you just HAVE TO BUY IT!! AND YOU WILL!!!

We actually had a little drop going into the last half hour today, so the INDICATORS are not over bought, on like the 15min charts, but the 60min is still pretty over bought. I noticed we went up to the trend line in the after hours, and then pulled back, so, we may have done a TEST of it, in the after hours, who fricking knows. I could see them continuing this bull shit for the rest of next week as well, wad ever. My option positions are virtually locked in, I had a Delta neutral position I was working on, and with the run up we've had, I've sold February 47 call's on the Q's, to lock in a no lose situation no matter where we go after this, and I've been day trading short put's, against the LONG puts, which is a bullish play. I'm hesitant to carry short put positions over night, as the next, OBVIOUS, big move, is going to be some big gap down, like, about 20%, at SOME point, but who knows when that will happen, hahahahahahaha, ROACH'S!!!!! My feeling is January 4th, but, that's just me.

BOND'S ARE GETTING INTERESTING! The 30 year has reached it's 200 week moving average, with the yield up to about 4.6%, while the TLT, at the bottom, still has room down to $86 before it hits that 200 MA, yielding just over 4%. I drew in a bunch of trend lines on the TLT, all it does, is show there's a BUNCH of trend line support in this "area", it doesn't mean we can't go through them, just that, well, there could be some "support" around here.

The BAAAAAAAAAD (DAMN SHEEP!) part, is that humongous head and shoulder's on both of those charts, I mean, if the 30 year get's nasty, and breaks down, it "COULD", go quite a ways. If you just measure it just from the top of the shoulders, it could easily go back down to those lows in 07', around 107. The TRADITIONAL way of measuring head and shoulders, is to take it from the top of the head, to the NECK LINE, so the 30 Year could drop all the way to around 88, I mean, I know that sounds pretty extreme, but when we started the 20 year bull market in bonds, in 1981, the 30 Year was at 45.

I only bring this up, because of the massive amount of retail mutual FUND money, that has been moving into bond funds. I don't think they quite understand, that if the BOND GOUL's finally decide to start making our spend thrift stinking government, PAY UP for their indiscretions, bond funds could lose 50%, faster than you can spell AHOLE BERNACKE!!!

Watch List for 12/23/09

A lot of floor trader's follow along with Mr. Taylor, are you trading with him, 12/18/09 , The Taylor Trading Technique.

This is a little exercise I do once in a while with the Q's, I'm just looking at the new highs we've made since the bottom in July. The numbers on the left represent the "approximate" gain we made, once we "BLASTED" over the prior highs. The biggest gain we made, was 3 points after the blast off during the July earnings season. The rest have been pretty moderate, the biggest being the two points we made in the dumb ass September rally (I, STILL, have NO idea what that was about), and currently, we are up about a point over the previous highs, actually, that's wrong, we are about 60 cents over those highs.
Anyway, one interesting thing, is that we took back ALL the gains, and MORE, during the pull backs after we made new highs, with the exception of the July gains, we took back two of the three bucks during that pull back. ALSO, we took those gains back, in HALF the time, that the rally took to make new highs.
Also, and this is VERY TYPICAL of what I've observed throught the years, if you remember, we pulled BACK from June, into July, ahead of those earnings, and BLASTED OFF, and then, we RALLIED, into the October earnings, and promptly pulled back, AFTER those earnings, actually taking out the October lows, in the two circles.
So, here we are, trying to RALLY into the January earnings season, hhmmmmmmmm. I mean, there's still a little more than three weeks before earnings start again, so, any thing can happen.
The basic point, of course, is that you buy the Q's on PULL BACKS, rather than taking the new highs, especially, when we are above the 50 and 200DMA's. YOU, of course, can do what ever you want, ME, I'm a slimey pull back type buyer.

John Hussman had an, aaahhhh, informative, post, yesterday, http://www.hussmanfunds.com/wmc/wmc091221.htm , part of it was about some thing I've screamed about in the past, the piss poor dividend yields on the S&P, (by the way, it's dropped back below 2%) and Lo and Behold, there's a "history" for these kinds of poor returns, hahahaha! HINT: it usually is not to conducive to higher over all returns for investors.

This will be the last watch list of the week, as Thursday is going to be a lousy, low volume, half day, and completely worthless, as every one get's the hell out of Dodge.
Not much on the bullish side, CNA is kind of interesting, it has a decent triangle on it, and TSV and MS are trying to move up, plus, it's above it's moving averages, which is better than a lot of the others on the list, listed as "True".

The run up in Utilities, "COULD", be OVER! I show EIX on the chart, but they all look pretty much the same, it had a gap down dump out of the highs and pulled back for four days, tried to regain it's composure yesterday, and put on one uuuugggggilllly looking bearish engulfing candle today, with negative TSV and MS to go along with it, very ugly looking. The others on that list that look almost the same include AES, PEG, DUK, D, ETR, SO, PGN, FE, CMS, AEE, I mean, it's NEVER a good sign, when the whole stinking bunch in a single sector, stink the joint up! A couple of retailers showed up on the list as well, ROST and FDO, both of them look pretty, aaaaaahhh, SHAKEY!

GDP

10amET: The home sales number at 10am ET came in MUCH higher than expected, and the Boyz are having a hard time figuring out if that's good, or BAD, hhahahahaha! They want to keep the FED on the side lines as long as possible, so it's getting to a point where "GOOD" news, may be bad. It appears they've decided to keep pumping us higher though, as they've moved the SPY higher the last couple of five minute bars.
ANYWAY, for those of you that are long and strong, the Q's have a very nice upper trend line on the daily charts, that goes across the tops from September 23 over November 16th. It shows up on the 60min chart above, and comes in around the $45.60 "area", I say "area", because a typical pump Yob would probably go through it first, before pulling back. ANYWAY, that would be a logical area for our first resistance. On an overall basis, there's not much resistance up to $48, but, we aren't going to get there in a straight line (hahahahahaha, at LEAST, I don't THINK we will!).
Good luck to you.

7:00am: Third quarter GDP was "revised" downward more than expected, http://bit.ly/8dUKdm , as the lies from Washington continue unabated. So how bad is the crash this morning??? HAH! The last I looked, futures were up by about 1/2%, as Da Boyz are keeping the pressure on. Either Da Boyz have a big player trapped short, or, the more likely explanation, is they are forcing Fund Managers that are under performing their bench mark's to have to buy this market into the year end. If that's the case, it really gets me worried about after the start of the new year, when those very same Fundies start over, and don't have to chase this thing.

In keeping with this runaway bull, Rob Hanna had an interesting article (as always), about extremely high volume expiration days, and the results following those days, http://bit.ly/4TWcBl . He went back 13 years, and there were 23 instances of high volume expiration days, and in 22 of those cases, the market traded lower than the expiration day at some point, during the next three days. I guess that's now going to be 22 out of 24 times, hahahaha, of course, we still have another day left tomorrow.

Bloomberg has created a NEW fibonacci retracement analysis technique, http://bit.ly/6qQfo0 . The main part of the article is about the lower GDP revision, but about half way down the author mentions that the S&P has to get back to 1121 to get to a 50% retracement of the bear market, back to the all time highs in 07'. He then goes on to say that a 50% retracement is" a signal to some chart analyst that the rebound from the 12 year low in March will continue". Hahahahahahaha, that's about the funniest thing I've ever heard! In my own experience, I have never, NEVER, heard anyone say that. It's called a "retracement", for a reason, the only rule I have EVER seen it used for, is that the market moves in one direction, and it then "retraces" 50% of that move, which then, GENERALLY, lead's to a continuation move, BACK IN THE ORIGNAL DIRECTION. Wad ever. Every body has their own interpretations I guess.

Watch List for 12/22/09

You know, why can't people keep it simple?? Here's 44 fricking ways to kick start your new year, http://bit.ly/5LmXJe , I did my WHOLE duty for the year, and satisfied Number 19 this weekend, by cutting MY OWN HAIR! I'M DONE, THAT'S IT, I'VE FULL FILLED MY OBLIGATIONS FOR THE YEAR!!!
By the by, if you trade for a living, you should probably consider items number 3, 5, 12, 14, 16, 18, 22, 23, and 30, and of course, 29 is an AUTOMATIC, every time I make a fricking trade, it scares the shit out of me, hahahahahaha! I'm working on 32, SIGH, I've cut down from three cartons a month, to one, and hopefully, more cut downs are on the way, but of course, that all depends on the MARKET!

This is later than the rest of the post below, since I made that big ass bold statement that the Q's have broken out, I thought maybe I should take a look at some of the breath charts, to see how they look, hahahahahahaha!!!! The NDXA50R, the percentage of stocks in the Q's above their 50dma, in the lower chart, is supporting, as more stocks participated in the new high today.
The next chart up, the Bullish Percent chart, is NOT to stinking great, that's the percent of stocks in the Q's that are on Point and Figure buys, it stayed flat today, and "could", be trying to get a bearish cross of the 50dma below the 200dam, not to great. The top chart is the Summation Index, $NASI, and has been basing side ways since the dump in October, and is "trying" to go higher, and make a bullish cross of the 50 above the 200dma's, an interesting side note is that the $NYSI, the Summation for the NYSE, is doing a bullish cross as of today. So, basically, the breath indicators are a little split, one bad, one better, and one improving. If we are going to be able to sustain the break out, the upper two charts will have to move higher in a few days.

The Q's BROKE OUT today! This is a break out, no doubt about it, it had decent volume on it, especially for a monday, it broke over both its TSV and MS, this is a stinking break out, as much as I HATE IT, hahahahaha! The DIA, SPY and IWM did NOT break out, so da Q's are trying to lead, the IWM is the closest to making a new rally high, which is in line with the small caps and the January effect. As I have said repeatedly, and most recently, here, http://cluelessqtrader.blogspot.com/2009/12/peek-at-spy-and-qs.html , the Q's have NO RESISTANCE, until around the $48 "AREA".
Of course, my over all view on the basic economic funnymentals are bearish as hell, as I think the whole thing, IE, the rally, is BULL SHIT! BUT, ya gotta do, wad ya gotta do, and I choose not to fight it. My base position is intermediate term (six months out or more), BEARISH, but I am day trading the shit out of this thing, against the position, and I'm doing just fine with that, Hey, I'm cool with it.

Carter Worth was on Fast Money tonight, talking about IBM, I found it pretty interesting. The chart looks all right, it looks just like the rest of the Index's, but Carter pointed out that IBM is sitting right where it was in 1999, during the Tech bubble, back then, it's P/E was over 40, right now, it's like 10 or 11, IE, the thing is ready to break out to new all time highs, with much better funnymentals behind it.

If you hate high dollar, peice of shit Chinese stocks, with their lying scum bag "funnymentals", as nothing that comes out of China can be believed, then BIDU is for YOU!!! Peter Worden had a five minute video on it this weekend, and it followed through a little to the down side today, both TSV and MS are in clear down trends, PLEASE, short this thing to where it belongs, ZERO!

The first half dozen stocks on the list are ALSO great looking short setups.

Weekly MSW Swing Trade Update for 12/21/09

The weekly signals on the ETF's have not changed since the post on Thursday, the MSW won't issue new weekly signals until after the bar tomorrow. On the daily signals above, it put on a new buy on the Whilshire REIT ETF, RWR, my personal opinion is that it looks exactly like most of the other ETF's, and I would take a little more liquid Index if it was me, like the Q's.
It has 7 new shorts, and in keeping with the Thursday scan it still wants to short silver, DBS, and still hates Europe and Asis.

On the daily scan of the Russell 1000, the MSW came up with 9 new buys and 8 new shorts. Both the two buys on the charts look "interesting", ASBC put in a kind of Morningstar formation the last three days, and could go higher, FTR found support at a trend line and bounced, right at a strike price, and put on a small engulfing candle.

All the shorts look interesting, although pretty marginal, GD has pulled back for four days, and "could" have found support at that major trend line, the stupid think looks like a buy to me, but the indicators have turned down off of over bought levels. ETN looks a little more typical of the other shorts, it had a gap down, followed by more weakness, it could find temporary support around 62.50, but if it gets through that it pretty much has a lock on 60.

On the weekly scan of the Russell 1000, the MSW came up with 6 new buys and 20 new shorts. Both the new buys on GXP and WU look just about like the majority of any new buys, they are "CONTINUATION" buys, IE, where you "BET" that the equity will continue to grind higher out of over bought and over loved situations, go for it, although WU has worked some of it off by consolidating side ways for quite a while, and "could" go higher if it gets over $20.
On the other hand, the shorts ALL look good to me, AT&T, T, put on an ugly engulfing candle last week, and could easily head back down to 25 before finding support. Estee Lauder is about as discretionary as you can get, although I guess women love it, but it got rejected at a double top from quite a ways back, and could easily see $40 fairly rapidly.

One note, the next two weeks are traditionaly strong, on the bull side, and shorts could struggle, I would imagine they tend to wallow a little, unless there's some news pending in individual stocks that normal investors are not privy to. I don't anticipate any big moves until after the first of the year.

Good luck, and as always, swing signals generated by the MSW are just "prospecting" ideas, and you should do your own due diligence, with proper money management and stops.

Weekly Sector, Industry and Russell 1000 Money Flows

Hey, bonds finally moved up off the bottom of the money flows, hahahaha, being replaced by consumer staples, I guess the animal spirits are coming to the forefront, when they start dumping the defensive sectors.
Speaking of defense, Healthcare is seeing the second best flows, behind the all mighty dollar, but with the BS going on in DC, Healthcare is no longer being driven by defensive investors, but is at the top of the animal spirit traders.
The Q's top the major Index's for money flows, and frankly, they easily have the best chart of the bunch, although the IWM is not looking to bad.


Hmmmm, it couldn't be Christmas time, could it??? There's probably no correlation at all to the time of year, and Toys and Games leading the Industry money flows, nothing like being a little late to the party.

Very interesting list on the Industry money flow laggards, Electronic stores is the worst industry, but most of that is BBY, although AAPL hasn't exactly been tearing the charts up. Silver popped it's head in right up at the top side of that list, with Gold a few spots under it, ALTHOUGH, I must admit, the chart of GLD looks a lot better, as it seemed to have found support on it's 50dma yesterday. The big Money Center banks showing up on the list are all due to that one outfit, C, and the billions of shares that traded this week, following the offering fiasco.

In the Russell 1000 Money flow leaders the past week, VHI was the only, REMOTELY, MILDLY, interesting looking chart, and I have no idea who, or what, they are, therefore, I no touchey.

I show BBY as the poster child for the Russell 1000 loser's, because, well, it's typical of the absolute bull shit going on in the markets!!! The analyst say BUY BUY BUY, BBY IS GOING TO DA MOON, THE CONSUMER IS SPENDING OUT THE YING YANG, IT'S A NEW BULL MARKET FOR THE AGES!! Then the actual company comes out and says, hey, chill out dudes, BUSINESS SUCKS! Aaahhhh, not to worry though, I'm SURE, it's just COMPANY SPECIFIC! Eventually, that chart is EXACTLY how the Index's are going to look, when the "REALIZATION" wave set's in.