Premarket 6/7/10

6:15am: First, the REALLY important news, http://bit.ly/beardownArizona , the Wildcats are trying to do the impossible, coming from the loser's bracket to win the Women's softball World Series, only four times in the last 24 years has this feat been done, a truly monumental task as they had to win both games on Saturday, AND, both games yesterday. The second thing that really pleases my heart, is they basically told the NCAA TO GO SCREW THEMSELVES, HAHAHAHAHAHAHAHA! The NCAA did what they always do, doing every thing they could to keep the PAC 10 out of the Championship game, mainly by jacking their RPI rankings around to make sure they put them in the toughest brackets in the regionals they had to travel to, and pitting some of our best teams in the Western regionals to make sure one of them was eliminated, hahahahaha, STICK IT WHERE THE SUN DON'T SHINE NCAA!!!!!!!!
Anyway, the market, sigh, wad ever, go for it, the MSM is touting that the futures are up five points, on NO news, well, other than Asia was down any where from 2-3.5% and Europe is currently slightly lower, ACTUALLY, we are up over a hundred points from last night, when we made a slightly higher low than the 5/25 low on that 60min chart above. What's coming up is the all important WHOLE number of 10,000 on the DOW, this "should" provide resistance, and provide a nice new shorting opportunity, but of course, shoulda coulda woulda is not a particularly great trading strategy. "SHOULD", we get through 10K, I'm probably leaving for awhile and go watch the Moo Cows chew their cud, as I anticipate extremely choppy and shittly action for awhile if that happen.

Schaeffer's monday morning quarterback had some interesting stat's,  http://www.schaeffersresearch.com/commentary/observations.aspx?ID=100305 , the ISE call/put ratio is getting back into a "buy" zone, and the $VIX, when compared to the 20 day historical volatility on the $SPX, is getting back into a leading divergence for a possible buy signal, this indicator broadcast a leading divergence in April when it signaled an early sell signal. On the bearish side, the two consecutive UP days last week were the first in 22 trading days going back to April, the one month returns after a streak like that have not been, aaaaaaaaahhhhhh, KIND, since 1972 we've only had 12 streaks like that.

Nice market analysis by Jeff Cooper, http://bit.ly/db773i .

I moved the five count triangle UP to include the dumb ass pump last thursday, it really hasn't changed any thing, the count is still bearish. The only difference could be that rather than have the triangle starting from the bottom of the "flash crash" bar, if you took it off of the bottom of the next bar to the right, we could be in a downward sloping channel, which projects REALLY lower prices if we get through the 5/25 and February lows. The 60 minute McClellan is pretty over sold on that chart, at -283, but the 30 minute McClellan is MUCH worse, at -392, meaning we may get a relief bounce, wad ever, the next trade on it will be a long trade as well.

I read on a site (unnamed) that the weekly, that's WEEKLY, not daily, UP/DOWN volume set a new all time record last week, 119 stocks down for every one higher. I don't have the foggiest what this means, but it should get my attention when we start talking records.

All the Elliott Wavers I follow have bearish counts working at the current time.

The daily NYSE Summation Index has been on a sell since the middle of April, and is still pointing lower.

The $TRIN hit a couple of higher levels than the bottoming period in 08' to 09' last week, it probably don't mean diddly squat as it had a SERIES of high reading during that prior period, while we've only had a few of them, for the moment. Besides, the market continued to go down anyway regardless of what Mr. Trin was saying.

Some Thing To Trade Off Of

Once in a while during times of extreme market turbulence like we have right now, I'll actually move away from my normal time frame, which is a five minute chart, and take a look at the loooooooong term time frames, like the 15 minute charts, hahahahahaha!! Actually, I'm talking about monthly or yearly charts, I got invovled with it because I was doodling around with the 10 and 12 period MA on the monthly time frames while I was watching the big sporting event this weekend, that being the Woman's College World Series, the best baseball played any where.

Anyway, I've referenced the study done before, about how LOOOOOOOONNG term "investors" can use a 10 period monthly moving average to time the markets, I tried to find the article by searching my archieves but there's to many of them and it times out, the "system" actually test's out fairly decently, IE it works, but there's some debate as to whether a 12 MA is better than a 10 MA, IE the 12 MA cuts down on the whip saws, so I checked it out on Telechart on the DOW 30, mainly because it has data going back to 1915 on them.

My normal MA settings are the standard 10, 20, 50 and 200 MA's on my charts, so when I switched to a monthly time frame the first thing that popped out was that with fridays drop, we are BELOW that 10 MA, again, BUT, as the chart above shows, we are sitting right on the 12 MA. But what really caught my attention was the 20 MA I had on it, it actually cuts down on the whip saws a LOT, and tends to define bull and bear markets a lot better, IE above that MA and the markets bullish, and below it, the opposite, but even that gets whip sawed a lot, so going back to 1915 I started adjusting that time frame to see how far I could go to cut down on the whip saws, and not get to much of a spread to make the "stops" in a trading system so far away that they were out of hand.

What I came up with was a 40MA, now, keep in mind I was looking back in the 1920's, 30's, etc etc etc, and when I came back to where we are now, Waaaaa Laaaaaa, the current rally had stopped almost EXACTLY on that 40MA and turned down, which is the orange line on the chart. What's REALLY cool right now, is that price is trapped between the rising 12MA, where we stopped friday, and under the declining 40MA, which is where the rally stopped off the March 09' lows, IE, long term "investors" have a wonderful point to trade off of, like Adami likes to say, your long term risks are very well defined right now.

But it gets even better, because what's showed up is the 200MA, the green line, which as far as LONG term investing, is about as important as it gets. You will notice we dropped under it during the last couple of bars during the drop into March of 09', now, that's the FIRST time we've done that since 1982, that was the last time we saw a monthly close under that MA, 28 years ago. And speaking of 1982, that's one of the reasons I used the 40MA as the intermediate indicator, because after we rallied off of that point the 40MA acted as important support for the drops in 1987 and 1990. Another very nice timing system is using a cross of the 12MA and that 40MA, as we got the cross to the upside in 1982 and didn't get a cross to the down side until the bear market in 2001, in fact they didn't even come close to a cross until then. Adding some confirmation to this little "indicator", we had that same cross in 1922 and didn't get a cross to the down side until 1930, we also had a cross in 1949 that, with the exception of a couple of little whip saws in 58' and 63', lasted until 1966. 

You'll notice there's a couple of minor little, aaahhhhhhh, GAPS, in those time frames above, like from 1930 to 1949, and 1966 to 1982, well, that goes back to that 200MA that's just now showing up as being, "IN PLAY", that 12MA broke under the 200 in 1931, with the 40MA following in 34', and we really didn't get a clean break back up until they both crossed back over that 200 in 1945, which was the last time the 12MA saw that 200MA until 1974, which amazingly, was just about 28 years, just like NOW. I don't want to talk about 1966 to 82", suffice it to say that once that 12MA saw the 200 in 1974 the market was shit city until the final cross higher in 82'.

The whole point of this little exercise, for me at least, is the wonderful R/R we have right now for Long Term "investors", you don't get such a tight R/R like this for maybe like, once a generation. For people like me, who are bullish on the markets (and the country), and are looking for MUCH better valuations at much lower prices, your stop on a MACRO short position is directly above that 40MA, or about $120 in the SPY, and for the Bearishly inclined who love over valued, over owned and over loved markets, you can take comfort in that rising 12MA that turned up right at the 200MA, for if you can hold this area and turn us back up over that 40MA, you may be able to drive us back to astronomical valuations and suck in hoards of retails that you can then crush at your leisure down the road, again. Should we continue to move lower here, and violate that 200MA, which is only about 2% away on the SP500 and SPY, which equates to 1020 on the SPX and 102 on the SPY, you may wish to reconsider your efforts to drive us higher, and instead unload your worthless "shares" on the retails while you can (much like the insiders are doing in the NasDogs right now, in record numbers, as pointed out by Barry Ritholtz), sending your salesmen and charlatan's out on all the MSM outlets, like TV, radio and the old newprint editions, with the Hue and Cry of "Buying Opportunity of a Life Time", as you sell sell sell to them, until we eventually reach a point where you feel it's safe to let them know they can now "SELL" their own shares back to you, like at about 500 on the SPX or $50 on the SPY (I know, my eventual target is $5 on the SPY, but I could probably go for $50).

Speaking of the SPY, Telechart has data that goes back to 1988 on it, and with just four days completed for the current month of June, we have had more Volume traded on it than any other month other than five months that surrounded the March 09' bottom, meaning that we are easily going to have the largest volume month EVER, we could possibly double the previous record month, which was October of 08'.

It just don't get any better than where we are right now.

The weekly chart get's even better for short term "investors", as the 200MA capped the rally off the March 09' low, just as it did with that almost perfect "Avalanche" setup we got in July-August to September in 2008, over to the left, and perfectly align's with the numbers on the monthly charts.

If you prefer to be a "micro" investor, the daily chart is just as clear as the other two, as that same 200MA has capped the bounce attempts the last two weeks, as friday's close is making the fifth attempt at breaking and holding under the February lows, and just like beating on a rock, the more times you hit it in the same spot the more likely you will be to eventually break it in half. If you are bearishly inclined, I wouldn't even consider trying to drive us higher to more unattractive valuations until we get back above that 200MA, that would provide a perfect rallying cry for the Charlatans, sucking the retails in with the all clear signal again.

If you are a Bull like me, if we can just get back under that monthly 200MA at the top, which is at the June highs from last year, and hold it this time with out the Government coming back in and committing the greatest financial fraud in history, like they did when they told the Wall Street banks to take all the bad shit off their balance sheets at the March 09' low, then we could have a shot at getting stocks at some reasonable valuations and dividends, for when they finally broke that 200MA in 1931, the markets lost another 66% before they reached their final lows in 1932, when dividends were higher than P/E's, hahahahahaha, they hit about 14% then, when P/E's were below 10, just aaaaahahhhhhh, slightly different than our March 09' low when dividends were just above 1% and the P/E, which had been adjusted to only include stocks in the SP 500 that HAD earnings, or about half of them, was a maaaaaaaavelous 184.

More Market Timing Indicators

7:00am: WHAT A STINKING DISASTER!!!!!!!!!!!!!!!!!!!!! The absolute bull shit coming out of the White House this week was just that, BULL SHIT!!!  Geeze, not only was the number way below even the average "expected" of 500K, coming in at 431K, but of that 431K, 411K were the temp hires for the Census, so that leaves 20K jobs being created in the private sector, RIGHT??!!! Yeeeeeaaaa, RRIIIIGGGGHHHTTTT, hahahahahaha, the dead people the Government likes to add in, in their pretend number involved with the Birth/Death model, came in at an UNFRICKINGREAL 215K, http://www.bls.gov/web/empsit/cesbd.htm , so in ACTUALITY, we ACTUALLY LOST 195K fricking jobs!!!!!!!!!!!!!!!!!!!!!!!!!!

Needless to say, the, "MARKET", didn't react very well.

HAH!! I just made $600 last night by just screwing around!! I joined a site that I've watched for the last, I don't know, four or five years??, I do that every year just to give every one a chance to prove themselves to me, besides, it's only $30 a month, I shit that out every day pushing the mouse button the wrong way, hahahaha, sigh!! ANYWAY, they have these super duper Quadruple Secret Indicators that they charge $600 for, for your TradeStation Platform, they've all been tested out and all that crap, so I'm looking at his chart, that's the one at the top, and I go, well I'll be damned, I swear that sucker looks EXACTLY like that indicator I already have, the indicator I'm referring to on his chart at the top is the very top one, or third from the bottom. So I compare them side by side, or above and below each other, and sure as shit, they match up almost EXACTLY, hahahahaha, IN FACT, I found out I have two, count'em, TWO, entirely different indicators that do the same job. The bottom chart is the Hull Moving Average Indicator, and the middle chart is a Linear Regression Column Curve, the only difference between my indicators and his are that mine over lay over the price charts, the cool part I really like is that my indicators work off of entirely DIFFERENT parameters, the Hull thingey works off of some type of moving average divergences, while the LRC works off of Linear Regression channels, I'd tell you where I picked these things up but I can't for the life of me remember it's been so long.

So, here I had "THE HOLY GRAIL" all along and didn't know it, HAHAHAHAHAHAHAHA!! By the way, they both turned green yesterday along with his, for wad ever dat's worth, the Hull indicator turns blue rather than green, I don't really like the green as it blends in with the candles. I have tried to create a strategy for these things to test them out, but they aren't worth a damn, my strategies that is, one thing I've noticed is they seem to work really well in UP and DOWN markets, but get a little choppy in Trending markets.

Anyway, sheeeeeet, I'll sell you the coding for these things for a lousy $200!

Just a little note about oil here, using the $BPENER with a 9ema cross over serves to provide some decent entries and exits to energy funds like XOP, XLE, ERX etc etc, it did a cross over yesterday plus the MACD is crossing over plus the RSI is crossing above the 30 level, all pointing possibly to higher oil prices, which all point to just Honkey Dorrey fricking great things for the average American's cost of driving to work, not to mention those other little minor things like food and clothing, and just about every thing we have to use.

Futures are down this morning, DOW about 80 points, as we await the monthly payroll report in about an hour, the estimates are all over the map, from negative numbers to above 700K, the concensus seems to be about 500K, that includes the census temps and the dead people the government likes to count of course. Since Da Boyz on Da Street, specifically GS, own the government and already know EXACTLY what the number is going to be, I can't help but think they took us down over night so they could blast us higher after the report, under the guise of a "SURPRISE" beat to the upside, wad ever.

Premarket 6/3/10

6:45am: We had a slew of economic reports this morning, Productivity came in way lower than expected, along with the ADP employment report, but what cracked me up was that Unit Labor costs came in better than expected, IE cheaper labor costs, hahhahahahahahaha, "they" thought this was the greatest thing EVER, which REALLY cracks me up, because they turn right around and bitch at that dumb ass consumer for NOT spending more money, as in the retail reports yesterday, "Retailers' reports show tepid May for shoppers",

http://yhoo.it/abrxb8 , and what really cracks me up is the supposed "explanation" for it as noted toward the bottom, it was the "LATE" Memorial Day weekend, hahahahahahahaha, excuse me, EXCUSE ME, but they used the exact SAME excuse LAST YEAR, accept it was because of the EARLY Memorial Day weekend, hahahahahahahha!!!!!! Wad ever, "THEY" just don't fricking GET IT, laying off millions of people and then cutting their wages so we can get a cool "UNIT LABOR COSTS" report, does NOT translate to higher consumer spending.

6:00am: Futures are up this morning, DOW about 35 points.

I took all the crap off this 60min chart to get down to my own personal basics, "they" destroyed the five point triangle yesterday by NOT testing the bottom edge of it first, wad ever, what I'm looking at now is going back to the inverse head and shoulders I had in mind before, before being before the fake out break out we had last week, nothing has changed on this thing other than the pull back we had could also be the handle of a cup and handle formation, either way there are some very CLEAR targets on it, first is the gap from 5/19 at around 112.50 on the SPY, THEN, if you take the width of the whole pattern you then add it to the neck line area, or the rimm of the cup, to get your upside target, what's really cool here is that it works out almost exactly to the high from 5/18 around 115, the OBVIOUS second target, that's also the 61.8% retracement off the bottom from the April high, so that's another idea supporting that area as a target.

Further down the road we could set up another cup and handle after reaching that area, but as far as the Elliott Wave counts that 115 area will almost certainly be the drop dead area for almost all the current counts, meaning a whole new pattern will have to be assessed.

The McClellan never reached over sold on the 60min chart but is now approaching being over bought, but, it can get a LOT more over bought, I should have showed the one I use for trade triggers, the 30min., as it's been wallowing in over sold territory for three days, and went from over sold to over bought in one day yesterday, wad ever, the next signal will be a short signal.

The markets have certainly been horrible, for with the exception of the back to back drops last friday and then monday, we've had huge reverse swings up and down the last nine days. The last month we've had a number of MAJOR accumulation and distribution days, that is, where the A/D's have been more than a nine to one lopsided basis, yesterday was a nine to one accumulation day, which could be a "Follow Up" day as to Bill Oneals interpretation, wad ever, volume wasn't exactly light but it DID NOT have higher volume.

The A/D's have NOT confirmed a move higher, YET, if we get over the 200dma today on the SPY and DIA then I want to see the A/D's make a higher high as well, even more concerning to me is that the Q's, which are the top two charts, made a new high over last week's highs but the A/D's were not EVEN close to confirming it, , this is a troubling Non-confirmation and I want to see those A/D's get their asssssssss in gear!

Also, if you look at that Q's chart, the red TSV indicator was almost FLAT yesterday, a new buy signal will not be issued until it moves above that dotted blue line which is the Moving average for it, also a little troubling is that MS just barely moved higher on both the Q's and the SPY.

Over all, I have a long bias at this point, but a major up trend won't get going until both MS and TSV get back above the ZERO line.

Premarket 6/2/10

7:15am: Sigh, I've just got to get over my slimey bottom fishing habits, wad ever, these AG stocks "MAY", finally, be getting close to a very small shot at them, the dailies are setting up some pretty obvious divergences on the indicators, I have TNH on the chart but they all look the same, like MOS, CAGC, MON, AGU, etc etc, my preferred senario is another pop down to make a lower low followed by a pop higher, that would set up the lower low price and the possible final divergence.

6:50am: AH HAH! Here's the REAL reason for the market decline, it's that damn World Cup, "The Global Effect of the FIFA World Cup on the Stock Market", http://bit.ly/9csV1L , over the last 41 years the US markets have declined an average of -6.5% during and after the event, in our case of course it's always because we always get our asssssss's kicked, accept for the girls of course, another play is to short the losing countries and buy the winners, woooooo hoooooo, the Holy Grail!!!!!!!

More stat's on it, http://bit.ly/aEfIf6 .

By the by, I hope some one took that JDSA I mentioned at the open yesterday.

5:30am: This is just a, "POSSIBLE", senario, on the 60 min SPY chart, the Q's are basically the same but the FLASH day bottom is a lot lower. If you take the FLASH day (the only "FLASH" of course, was the FED and Governments live's FLASHING before them) as the entrance into the triangle, then that's point 1, what happens, geneeerrraaaalllly, is you get five touch's on these triangle's, once you reach point 5 you bounce up (in this case) through the top of the triangle Da Udder way, and with the slightly descending wedge to it point 5 would logically do an over shoot before turning up, which would over shoot the bottom from 5/25, at 104.38. We have a gap waiting to be filled from 5/26 at 107.15, which we missed filling by only 22 cents yesterday, and the McClellan is not over sold, YET, but it won't take much more down side to get it there, both of those items support lower prices ahead.
Of course, if we blast right through the bottom on 5/25 then we start looking for support areas from way back, the first one coming from the first trading day of November at 103.08, and then it's an on and on type of thing, until we get to the March 09' lows.

Currently, futures are higher this morning, DOW about 45 points, the reason being given because of flagging concerns about the global economic recovery "Oil near $72 as economy concerns drag on optimism", http://yhoo.it/bSRAZY , I can't make these headlines up as far as comedy hahahahaha, and oh, yea, Europe and Asia were down about 1%, the real reason we are higher of course is Da Boyz drive it up in the low volume after markets with no one home so we can short the shit out of it after the open, wooooo hoooooo!