ok, time for King dollar to make a big move up and squeeze the shit out of USD shorts.

Would be nice

shorted that top super fucking hard, making back the money I was down earlier.

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http://evilspeculator.com/?p=12456#disqus_thread
Skål!

she's looking toppy here. A lot of energy getting her back up here given yesterday's move and the gap down. Staying short the banks and REITs.

I agree with your charts evil, i think we area in the final leg of this upside movement, wave ii can top today check out http://marketrendwaves.blogspot.com/

regards.

I've got EUR up against a TL that has been working really well. If it breaks through 1.4914, it will pop higher in one or two waves, taking equities with it. *sigh*

Gentleman, I've suffered enough losses this month. Next week, I will capitulate and lick my wounds if it continues in the wrong direction. I can't take this anymore. I was up 10% in my portfolio and now I''m down 10-15%.

I'm not sure what you are working with but I highly recommend hedging with futures, hold your short positions and keep walking the stop up on the fut's. Other than that, I focus on picking tops. Wave 2 can retrace almost all of wave 1 but if it exceeds the top ge

I just play SPY vertical puts. How would I hedge those with futures? I"m not too familiar with them. Maybe describe briefly so I can look into them. I really appreciate your input. I've worked too hard this past year to build up my portfolio. I'm thinking about taking a break if my losses mount.

Get think or swim and you can paper trade them to start. SPX future is /es. Pays $50 per point, very liquid and easy to define stops that trade almost around the clock. For example, I bought my XLF and IYR puts yesterday and instead of sitting through pain or trying to get in and out of them, I use the cash in my account to buy a future contract- /es ( or /nq nasdaq, /tf russell, /dx usdollar, etc) that will offset the money I am losing on my puts. Since it's easy to walk the stop up and liquid, I get in on a ramp or break or resistance and get out the second things look to be rolling over. Since it trades almost around the clock it allows me to manage my position pre-market or if something blows up overseas during the night if need be.

edit

So glad I'm paranoid, regular profit taker, DAX making a run for the 5600 area after all, so careful, more upside potential from here.

That said, SRS is being a real trooper. Look where it was the last time the $dji was up this high and you'll see what I mean. So the bear case is not over yet.

heads up, dollar dumping again

/NQ possible H&S : http://screencast.com/t/yf3sCOMUWR

Same ith /es

WTF is going on. Look at AMZN

i am loaded... short 110 DEC Put.. someone mentioned few days or week ago that it has to make another high for EW count and then it will fall like whatever... shit.

Amazon (AMZN Quote) upgraded at Bernstein to Outperform. $160 price target. Estimates still appear to be too conservative.

Wow, AMZN going parabolic. A lot of shorts on that one getting squeezed.

I'm one of them....

ok, jumping short here at SPX 107.25. Sticking with financial shorts as other sectors may hold up better with this weak dollar. I think top is in for today.

SPX touched it's mid-bollinger on the daily, not a bad place to take a taste IMHO. I'm half short and hedged, waiting for a little higher or until the dollar spikes/ money stops coming out of bonds.

FAS keeps butting up against the 30 EMA on the 2hr chart, but hasn't broken through convincingly yet. Until that changes, the play is definitely to the short side.

i mean SPY 107.25. Will stop out if we hit 107.75.

If the IHS plays out, spx target would put it right at the old swing high.

Could the drop this morning be a d wave and we are now in an e of an ED with target of 1073 (or higher)?

Put 1/2 short at 1068 adn 1729

Interesting banks not participating. Favor up into Monday but will add small FAZ long today. Is G 20 this weekend?

more important than the stock market, gold just hit $1100.

the silent leg is underway, one way or the other real s&p will make double bottom within 2 months

STU guys were predicting this on Wednesday, also S&P 1067 or so.

1078 was their call for max high

Elizabeth Warren was just on Bloomberg celebrating success of TARP etc. It's OK to go long everyone.

It's all over. Lots of celebrating market reaction to jobs number. If this isn't a top Karma should step in here and make some bulls cry.

AMZN is a whore... someone is selling systematically at high..

Be very careful on the short side. Put in the context of a slightly bigger picture. Got sent this by a broker y'day:

"Interesting analysis around equities performance within the context of mutual
fund managers who are missing their benchmarks and have to play catchup into
year end. Since 1995 the number of managers missing their benchmark by 500bps
has tended to explain the stock performance between October and Year End. This
year the 23% missing their benchmark by 500bps is above the median lvl of 19%
and comparable to lvls in '95,'97, '03, and '08. When managers have trailed by
23% or so (through Oct), the S&P 500 rose into YE 83% of the time, with a
typical gain of 5.1%. This compares to 63% and 1.7% for other periods."

Also, AAII bear/bull spread at lowest point since March. Tallies with the notion that de-risking is over. The chances of a typical year-end rally are high. Not saying you can't make money on the short-side but you need to be doubly certain of risk-reward. Take profit when it is there, don't look for the P3. Odds don't favour it.

I guess we have to look to sell 1075

11/9 is a Bradley turn date, I'm looking for a top on Monday but not going to hold long over the weekend.

Breadth just turned positive.

Isn't 1070 a critical fib level?

1073 is 61.8 retrace from high to low.

wow...

well I'm getting slaughtered today

Fuck this market. WTF man

Yeah this thing is exploding.

We broke over 1067 resistance. Short squeeze to ensue...

Gap fill then fail???

Insite is right IMHO. Money flowing out of bonds strong

not a chance

We should drop like a brick from this 1067 level -- if we don't this market is completely crazy.

sorry - 1090 is on the cards.

Not today though? Tuesday?

who knows? always underestimate how wuickly this mkt moves. Inventory data out at 3. If good, could take us there today.

Selling day trade long (@1056) here @ 1064, core long remains.

why sell at 1064 if we're going to 1090?

Just different timeframes. Came in to today 90% long, took it up to 120% at 1056, back to 90% now. Want to make P&L day trading as well as medium-term trends. 1090 would be a medium-term level.

/dx ugly, /zn falling as well. ramp on

no shock, gap is filled. interesting to see how she reacts from here.

I don't know what kind of idiot bought AIG up yesterday on the rumor that the EPS would be $4.50, $0.68 is more like it.

Your puts worked out :)

/nq strong, hedges on again

Look, here is something that is way more important than the unemployment data that has just come out:

http://www.shrm.org/Research/MonthlyEmploymentI...

Core SPY puts and FAS puts picked up yesterday at HOD are looking ripe! This umemployment number sure seems scary though.

hi.. now that this job data is out, is it safe to keep the shorts that i had in weekend and next week. I have AMZN, COF, GLD and SPY, FAZ (long calls)... or take the profit on any gap down..
i can't trade in day coz of limit so, asking.. thanks

I would assume you're up on some of those positions except possibly AMZN right? I think you should take profits whenever you can. This market is out to screw the bears.

The market is out to screw everyone! All stops get run on the S&P

Reaction to jobs number is somewhat muted. I am guessing we fill the gap down. I am looking to get short, but I'll wait until end of day. If damage is minimal, I'll probably get long as new highs are probably coming.

EUR is back to levels just before employment report, but ES is 10-pts lower. Setting up for an eventual gap close today as currency trade still rules.

Hmm, on FOMC day I had left orders in to short additional DOW at staggered levels from 9950 up to 10k in lots of 10% x 5, and 50% at 10k, which I felt it would reach. They didn't hit on Wednesday but obviously they did yesterday. I can cover these all here for profit at 9948, but am agonising over it.

Part of me feels that regardless of the liquidity/risk trade implications, that 10.2% is a scary headline figure, and that we will see followthrough.

Another part feels that after every significant news release of the last couple of weeks, the first move has been the wrong move and that profits are profits.

I'm never good at these decisions.

You could cover half and let the rest ride with a stop loss of your choosing and just relax.

Cover 50% of the position and bring a stop on the rest in to break-even point.

Some profit taking is never a bad idea. My indicators show a potential bounce in the works.

Lets see if this pans out

http://screencast.com/t/mrqBRUMxG

Im sure no one looked into my AIG call yesterday, but it was down 10% last I checked. My puts from hod are going to be awfully plump :)

I did. Haven't had the brass to play AIG though. Very nice trade! Me personally, I would take the money and run like hell. AIG is one weird mofo of a ride. Hit and run, hit and run.

"$INDU key crash/acceleration level for tomorrow , will be at $INDU 9835. IF the INDU can hold that level no crash until next week" - is baminvestor.com reliable?

Do we see a VIX spike today?

Over 10% has major psychological impact.........watch for x-mas sales to be ugly

Think that's bollocks. This is not a bad set of data. Temp jobs up, hefty upward revisions, hourly earnings up. These are the forward looking indicators.

I think it depends on how you look at it too.

Employers are not going to add full time jobs for some time until they feel safe that are not going to slip again - and until they have some cash built back up (or obtained some financing)... none of which is even on the horizon right now.

The norm for awhile is going to be contract labor. One would think, that in forward terms, this is not a recipe for a true recovery... it is purgatory.

However, right now, society does not want hear the bad. Only the good. The filters and spin turn "less worse" into "good" and I would not be surprised if the numbers today are spun in some similar fashion.

I am short here FWIW. A gap down would be nice, but I am not holding my breath for a ride to 1025 today. I am beginning to think we might chop around a little more before taking the dive.

I'm afraid I just don't see it. Unemployment always peaks after markets bottom - you would have to be incredibly confident that it will get materially worse to see equities on the basis of a rear-view mirror data point. There is always a temptation to be either a bull or a bear - I just want to make money. The data right now tells me things in the FUTURE are getting better. When that changes, I'll change.

I draw the parallel from looking at my own firm and many companies that we interact with. The outlook for 2010 on the corporate level is not healthy - and not of growth. The plan going forward is to survive, like 2009. And avoid hiring (do more with what we have). We already have used some contract labor this year as well. Likewise, if we hit one more bump in the road, we will lose more people quickly.

It is true that unemployment peaks after the market bottoms, but I do not think the market has bottomed yet. Maybe that is where we differ in view - or timeframe.

Then again, I admit is difficult for me to attempt to read the timeframe in which the market is looking into the future. Timeframes, trading horizons, etc. are pretty screwy these days (e.g. buy and hold or not). Faith in the system is no more. J

Just offering a twist on the perspective by the way. Not arguing at all. Thanks for the response.

It may be the case that unemployment always peaks as market bottoms, but where do you see growth. Companies are reporting earnings because of cost cuttings and stocks are blowing through the roofs. It fundamentally doesn't make sense. Basic finance tells us that PROFITS/EARNINGS = REVENUE - EXPENSES. Companies are simply reducing expenses. Where are the new revenues/sales? At if we keep rallying, the value of the US dollar will depreciate. This is not especially good for US imports which leads to higher prices passed down to the consumers. If consumers don't have jobs, how can they afford to pay these exorbitant prices.

They are about to start hiring, you just can't see it yet. The weak dollar is helping export demand, forces US consumers to buy American. Inventory levels have come right back so demand is about to pick up and that will push revenues up. Given current low costs base, earnings will explode higher and there will be a rush to add staff.

FWIW I think that takes to a level which will be a inter-generational selling opp but it's not here.

Interesting perspective. I don't know anymore. Aside from imports/exports and inventory levels, you also have increased foreclosures and credit card defaults. ARM (Adjustable Rate Mortgages) are about to reset in the next few months and this will drive/lower interest rate given an individual basis. For the bulk of ARMS where the interest rates will increase, this will drive up monthly payments and increase foreclosures.

We can have a healthy discussion back and forth. THere's always multiple views but being right is harder than being wrong.

I just view it as a battleground between inflationary and deflationary forces. Either will be winning at some point and I want to be on their side when they are. Long-term I am a huge bear but my job is to make money for clients so pragmatism is the key.

Sincerely appreciate the back ad forth here. Thanks. I had to step out and came back to some great posts.

Hmm, I had no idea that 17.5% unemployment is such a good thing.

I guess I'll put that bid in for MO after all: Recovery = More money for fags.

yes, another green shart.

BTW, how was Guy Fawkes night? It used to be a big deal here in Canada, but no more really. I didn't see a single bonfire in this heavily Anglo area of Ontario.

Very good. Clapham has the largest fireworks display in London - by US standards, it's average but we are poor folk. Sadly, my two-year old got scared after 15 mins so we had to leave but was fun while it lasted.

We'll have to see how the unemployment report is received by the street. We may sell off today but come next week, it'll rally back, recover its losses and push towards new highs. This is the most fucked up market ever.

Why would they wait until next week when they could easily do it today? ;-))

You're absolutely right! What was I thinking?

OK, good luck all - I am back to my cave

Me too.....back to sleep........

S&P only down 8, thought they'd have given back all of yesterday's gains on that 10.2 employment number...

1051 key. I wish we would break, but my hunch is we rally back to 1065 to 1075 into Monday/Tuesday.

After 11-10, a HARD break for 1 to 2 weeks.

DAX and FTSE not looking like bouncing

This could set up a sweet dollar squeeze......so many dollar bears........perfect setup

I'll pray for you to be right - holding /dx for 2 days now

When the number comes in .3 or .4 % over expected.....that is quite bad news......

not is we short :)

Well......there's a difference between optimism and blinders.......

I am buying the market right here.

a plan is a plan is a plan
good luck

US Gov Official Job Data
http://www.bls.gov/news.release/empsit.t12.htm

U6 is more indicative than U3

Wait until U6 is around 25%.........this is going to get worse.......Kondrakrief wave shows a little bump inot 2010.....then a decline to the bottom in 2012........seems to be fitting

not certain that even U6 is any accurate anymore, it does not include people who just gave up and became invisible - does it?

All that takes is a walk in any city with a mild climate.......homeless in every building doorway

Net Jets is laying off 500 pilots.......those are good paying pilot jobs.........I see unemployment accelerating........especially with extended benefits. I finally gave in and layed off an employee........my wife is going back to work in the office.

I'm relaxed, often the initial move is the wrong one. Direction of revisions often more important that the actual numbers and hourly earnings were positive. Certainly keeps policy accommodative for a while yet.

CNBC highlighting the positives...(revisions to previous months)

Wonder why they don't do that when it's negative revisions to previous month( for the past year)

cos they are bulltards!

Turns out USD was screaming sell the equities, but did I listen? Naw.

Yep - was watching Eur/Usd as it started to break down before the ee data release. Could have sold more ES at 1066 comfortably following this action.

Its the headline number of 10.2% rather than the absolute number of jobs lost I think.

-190000 vs -175000 consensus

!)% is a majic number.......consumer will see this as an impetus to stop[ buying.

-190k
10.2 %

Guess numbers weren't too good....it appears.....what a dump

DAX niiiiiiiiice dump. :D Lovely damage on the 10 min chart.

Gawd I hate these days. I just missed out on a 10-pt short, but who in their right mind would short before this number?

FTSE just dumped what happened?

ftse has had swine flu all week

Pre-Market warm up
First up, the FED numbers. The bottom line is that the Reserve Balances with Fed Reserve Banks SHRUNK by $20 bb for the week ending Wed, Nov. 4. . Correct me if I’m wrong with this assumption – but doesn’t that mean that $20 bb went out into the financial system as liquidity? There is your market pop.
The MBS numbers show a change of $330 mm, but the FED purchased $16 bb during the week. Either something was written down, or principal repayments were received, no?
Equity
SPX got up near the cross between ULTRAVIOLET (ascending lower trend line from March 2009 at 666) and the downward sloping trend line that began Oct 21. To me, this is a retest of the breach of ULTRAVIOLET – which any self respecting chartist would expect before the drop.
It’s still a binary choice (as it ALWAYS is). SPX can either go up from here, or go down. Going up means getting above ULTRAVIOLET back into the upward moving channel. Rejection means that SPX still has to breach the trendline from July 2009, and re-test the FIB at 1014. The close today should provide that longer term indication. SPX could also bump up against that ULTRAVIOLET and follow it up for a while before taking a direction. If you go short herre, IMO, put stops above ES = 1072 (it’s a pivot line). If you go long here (given the overhead resistance, this is not my favourite play), you don’t know if you’re wrong or not until ES = 1055 or lower. Not a good risk /reward situation, IMO.

Asia was quite green, especially in Australia and Korea. The DAX is essentially flat, and the FTSE is just green. The DAX is green in Consumer Services, Consumer goods, Healthcare, financials and Utilities. This is quite a mixed bag and I’m not sure how to interpret it. The DAX has moved up a bit over the last week after putting in a lower low. This AM, it has been essentially sideways with a 40 point range from peak to trough.

ES Pivots:
R2: 1084.50 = Not quite at the recent highs (Oct 16)
R1: 1072 = Was support up until Oct 26. Look for this to be strong resistance, IMO. We also have the ES daily mid-Bollinger at 1065 to get through first.
Neutral: 1055.50 = Resistance on Nov 4, Support on Nov 5
S1: 1047 = Resistance, and then the launch pad on Nov 5.
S2: 1030.50 = Around the level of the Daily ES lower Bollinger.

FX
Remember that the EUR still hasn’t put in a lower low on its long term chart – just like SPX.
USD is marginally weaker. CAD is still moving down – guess the BoC jawboning is working. Maybe they’re putting their money where their collective mouth is as well. JPY and EUR are both stronger. Good for China, bad for them. GBP is marginally weaker.
Quite a mixed bag and also hard to interpret. The EUR did run up after the Europe open but has sold off back down to the neutral pivot.
EUR pivots:
R2: 1.4972 – Way above us now. Also the location where some CBs and BIS come in to sell.
R1: 1.4922 = Key line in the sand. Breach of this means going quite higher as EUR retraces the waterfall from Oct 26th.
Neutral: 1.4867 – was s source of support all night.
S1: 1.4816 – Where EUR launched up from on Nov 5
S2: 1.4761 = Ferocious support, IMHO, after being resistance for a number of days.

News
Everything is about recovery right now. That, and the FED’s war chest should keep the equity markets moving in an upward direction into March 2010 (when the MBS program expires, among others). Just my opinion. The FED could also start pulling liquidity, as they’ve hinted, just to mess with Congress and stop the audit and removal of powers.
After gaining 30K+ jobs (all gov’t) in September, Canada lost 40K+ in October.
FNMN bailout is now up to $60 bb after 9th straight loss.
AIG posts profit. Shares fall. Go figure.

Data
8:30 – Jobs, jobs, jobs = expected to fall only 175K vs 263K prior. Earnings are expected to be flat (I think that this will fall myself given the consumer data).
10:00 – Inventories = Is this where the GDP growth came from? They are expected to fall again. There are just too many disconnects around this type of data.
15:00 Consumer credit = -10BB exp vs -12 BB prior; The old 2nd derivative play, perhaps? So long as this keeps contracting, it’s hard to believe the consumer numbers.

Cheers.

I dont think we'll see a downturn short term. The FEDS have reaffirmed that they will keep interest rates low for some time (3-6 months). As long as interest rates are low, we'll see a rally. I think institutions and hedge funds know that there will be a correction but for now, they are just riding this tape and taking it for what it's worth. I caught the tape as it sold off last week heading into this week. Most of my gains have turned into losses. Depending on what happens today and into next week, I will probably have to cut my near-term puts (Dec/Jan). I'll hold onto my Mar SPY puts for some time.

Thoughts anyone? I mean, can we really be that wrong

Bob

You mention the $/Equities trade all starting to go the one way. What do you think will be the catalyst to start this. I found this article fascinating;

http://www.marketoracle.co.uk/Article14805.html

I know you won't agree with the title, but the graphs of the S&P vs Eur, Yen, Chf were amazing to me and totally illustrate how the last 3 months move has essentially been nowhere in non-dollar terms.

So what do you think needs to happen for this trend to reverse; i.e. the dollar strengthens and equities continue to rally?

Would appreciate your views.

That's totally true which is why I think being short equities is not the right trade just yet. They are a nominal asset class and even if they go nowhere in real terms (i.e. in neutral FX or Gold, etc), they still go up in nominal terms. Imagine what equities will do if there is actually real growth? Which there will be for the next 6 months.

I see barry ritholtz is saying the number will be worse than expected, given the feds "no interest rate increases for the foreseeable" stance, and that this will paradoxically be good for the market due to the implied free liquidity trade continuing for a long time.

Perhaps an early dip towards 1055ish where we bottom out and rally sharply to close the weekend near 1070ish?

There are whispers of +100k out there. Goldman's have -200K and they tend to be most accurate. Agree with Ritzhold comments - bad is good with the proviso it's not too bad. Not sure that a good number will be particularly bad either given Fed statement is behind us. Risk asymmetric to the upside for sure.

BTW, Briefing.com expects -230K on the jobs report, while the "consensus" is only for -175K. Dollar picking up a little steam right now. hard to read anything prior to a big report. Could just be backtesting before reversing on a good jobs number. Or, the start of something big?

Congress passed a bill to extend unemployment benefits again, is this going to make the unemployment numbers rise again when all the thousands of people who have exhausted there benefits go back on the roles again???

Also - as a general point. A lot of people seem to think the FX/Equity correlations are gospel. I think we are heading into a period of $ and equity strength, rather like 2005. That makes perfect sense as the US economy is looking better on a relative basis than the rest of the developed world.

I agree there will come a time when equities and USD move in tandem. I'm just not sure what the trigger will be, when that will happen and what the direction will be. Apart from those minor details, I hope I'm ready when the time comes! LOL.

Short-term I see resistance at 1072. We are 90% long and I would taken that down a bit at this level. But if it breaks 1072, could be messy to the upside so would not get short until 1090.

Risk-off has been huge in back end of last month, beginning of this. Most L/S funds are up mid-teens for the year and squared off in a panic. 23% of US mutual funds lag the benchmark by more than 500bps - historically, this leads to a positive Q4 for equities as they chase performance into year end. Given HF have already taken he risk back, I'm not sure what can stop it. As I said y'day 1062 was a big level. If we now hold 1060 today on ESZ9, means we are going to 1090.

USD has been moving up steadily while the NQ futures have barely budged from the top....what's up with this?

USD strengthened 30pips, EUR dropped 50 pips, yet futures has continued to climb up about 4 points. Not much correlation going on in right now. . .

USD strengthening a bit here, ES up marginally. I want to short this thing badly, but the jobs reports is the only thing holding me back. I expect a lot of stop sweeping 5-min either side of the announcement and a HUGE buildup by CNBC.

abc up looks done right here. IF market falls following the number, it will likely fall for a while.

RUT ABC looks perfect......but hell.....who knows.

good day to all,

playing with lines http://www.flickr.com/photos/42905134@N08/40804...

Is it just me or any there no comments getting posted at the moment? Can't work out if Disqus is broken?

CNBC - The "Subliminal Bulls." They agree with the bulls and challenge the bears while leading the uninformed over a cliff.
They all had a big "O" last week when Buffet did his deal.

Went to Dick's Sporting Goods last weekend to buy my son some Bball shoes. They have nothing in stock. You have to order them with a 5 to 7 day delivery. That is how tight retail is managing inventory. Unless you buy it first , they don't stock it.

What part of the US was that?

Atlanta

Is it normal for the $dji to lead an uptrend? I'm just wondering because all the other US indexes are showing a wide-ranging degree of technical damage. LQD/JNK flat. The ADX indicator is showing the $bkx in solid bear territory. Can there be a real rally without the banks?

The DAX is still in a downtrend, forming a possible double top on the 10 min. chart. It had a perfect chance to rally to 5600 yet it remains stuck at the 5470 area. The German banks are in the green (1.5%) but not the kind of green (4-7%) we used to see in the past.

I'm perfectly willing to accept that I might be wrong. I was doing some research on a few high-yielding longs yesterday, just in case. But the sectors I like to short don't seem in a position to do a serious rally yet.

I think your points are valid, NDX is more of a leader but DOW is most publicised so easier to headline (narrow index).. DAX also seems to be struggling BUT that may change with a BIG rally in US (still would need to get above 5600 to repair damage done in last week) ...bit I would watch NDX instead of DOW for confirming...(also DJT looks like may struggle to get to new high...so divergence between the IND and DJT)..
20 mins till Kick Off...mhoo