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U.S. Irrelevancy
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U.S. Irrelevancy

by MoleJuly 27, 2011

FWIW I (Volar) don’t trade much in July and August for seasonality reasons.

Sorry I have been gone from ES- just been utterly busy and mostly out of town.

Anyways, I would first like to show you a chart pertaining to “fundamentals.” From ZH to every other blog, Muppets flock to the US news and data to seek the end of the world. None of them even consider that 30% of S&P earning are from abroad, let alone in 5 years more cars have been sold abroad than the US has people. Incomes are growing abroad, and until that changes dont get too hung up on useless data here in the US.

Here is a chart that places things into perspective.

So, when do you think any developed country’s economic data will matter? Cheers.

*Also- if we are really going to default why are rates at 3%- not 40%? Anyone Bueller anyone? Ugh the media is full of morons.

Now for the rats, I have some sentiment data to ponder.

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More of Volar’s charts and commentary below for anyone donning a secret decoder ring. If you are interested in becoming a Gold member then don’t waste time and sign up here. And if you are a Zero subscriber it includes access to all Gold posts, so you actually get double the bang for your buck.
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First the ISEE BTO Call/Put Ratio Rate of Change (ROC)

If we are in a bull market- well then this is nothing to worry about. If we are in a bear market (call it a 30% chance), well short your heart out. * But I do not think we are in a bear market (yet).

And one more ST indicator (RYDEX funds).

First is the raw ratio:

and the ROC:

That being said, when I look at some longer-term data I am quiet bearish bonds (partly bullish stocks).

Clearly too much money in bonds…

Bottom Line: we could have a decent sell off but the LT trend is higher. Remember August has no real edge from a seasonality standpoint, but the Fall in general can be ugly.

Best of luck trading guys,

-Volar

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About The Author
Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.
  • Schwerepunkt

    Nice chart Volar. It makes your point very well. The only bone I would pick is the inclusion of Israel on that chart. Had to scratch my head at that. 

  • http://practicalt.blogspot.com/ Gold_Gerb

    cars.. sweet sweet crude.

    BULLISH!

  • http://practicalt.blogspot.com/ Gold_Gerb

    /ES 1299.00

  • http://practicalt.blogspot.com/ Gold_Gerb

    downhill Fib Fan for your entertainment.

    http://i52.tinypic.com/34qtmj5.png

  • volar

    I weight the data for population & not all counties give data- so you have to get the data where you can from diverse regions.

    So Israel is weighted <2%

  • volar

    I weight the data for population & not all counties give data- so you have to get the data where you can from diverse regions.

    So Israel is weighted <2%

  • Anonymous

    VIX closed above upper BB. Strike one…..

  • Anonymous

    Love the Rydex Charts Volar.

    I have to take exception to the Global Car Registration analogy though. For the sake of space and time, I’ll only address China.  I agree that China could end up as the end all to beat all but not without terrible machinations along the way.

    For the sake of space and time I’ll only address China.

    First, how many Chinese are going to buy cars on $7.00 Per Day?   Eventually income for the average Chinese worker would have to be raised significantly in order for China to become totally self sustaining from within their own population.

    Second, once the average Chinese worker is paid more what happens to the costs of Chinese exports?  I believe they would need to increase prices which would allow other countries including the United States able to be more competetive. 

    Lastly, at the present time, I believe that without the United States in position to buy cheap Chinese Goods, China would be severely hurt economically.    So if the US Fails, it is not irrelevant by any means.

    These statements do not come from ZH, MSM, or anything else but they come from 65 years of my own experiences, education and what I see when I look out the window.   :)

  • Anonymous

    LOL! : http://www.cnbc.com/id/43915240

  • http://practicalt.blogspot.com/ Gold_Gerb

    i’d laugh but this is exactly the type of (cr@p) I’d expect to appear as we sink into a North Korean regime environment.

  • Anonymous

    Given the dude’s reputation I would say that was a bullish indicator. I am not ready to go long just yet though.

  • Schwerepunkt

    I would think Saudi Arabia or the GCC countries would be more relevant, or even Nigeria, or the Maghreb. Maybe they don’t publish figures? 

  • http://practicalt.blogspot.com/ Gold_Gerb

    wow, wasn’t the last time I posted this graph, it was a zig inside a zag with indecision?

    now look at it…RISK IS OFF babeee….

    http://stockcharts.com/h-sc/ui?s=$BPSPX&p=D&yr=0&mn=6&dy=0&id=p84652413203

  • Schwerepunkt

    Not a fan of Bove, but what’s wrong with what he’s saying? Seems like sound advice for now. 

  • http://evilspeculator.com molecool

    Regarding that last chart – wouldn’t the Fed’s machinations affect the bond plot? Admittedly it would also implicitly affect the equity plot….

  • Anonymous

    /ES 1300 should be heavily defended IMO

  • http://practicalt.blogspot.com/ Gold_Gerb

    no video. arggggh.
    this is no cake walk – 

    http://stockcharts.com/h-sc/ui?s=CAKE&p=D&yr=0&mn=6&dy=0&id=p24186193048

    broken 200, so much for eating out.

  • http://evilspeculator.com molecool

    Or the Vatican.

  • Anonymous

    who owns the federal reserve

  • Anonymous

    yo mama
    😉

  • Anonymous

    after some investigation, it appears that my mama has no ownership

  • http://practicalt.blogspot.com/ Gold_Gerb

    still no video..(sigh)

    hey, paper equities are now, really really cheap!
    :-)
    http://stockcharts.com/h-sc/ui?s=$SPX:$GOLD&p=D&yr=1&mn=0&dy=0&id=p44460139076

  • http://practicalt.blogspot.com/ Gold_Gerb

    ok, off to bed.

    Mir schwant übles.

    wow, that was an understatement yesterday, eh?

  • volar

    yup that is the issue- get data where you can :(

    entirely agree.

  • Schwerepunkt

    Looks like a good report from XOM, but stock is down. Telling.

  • Schwerepunkt

    Fed Call: No Liquidity Operation Scheduled From The Fed
    Last update: 7/28/2011 8:14:48 AM
    ============
    they do plan on buying $14bn in bonds over the next 2-3 weeks using the proceeds from maturing bonds. Funny, even if the govt shuts down, the Fed will be buying bonds . They’ve become temporarily self-funded in their liquidity operations. 
    Deus ex machina?

  • Anonymous

    Should be good for SPX 1330 or so then the real fun begins;)

  • Schwerepunkt

    Anybody feeling warm and fuzzy now that we know “only” 398K new jobless claims last week? Under the “magic” 400K mark. Magic 400, sounds like a bad (easy listening) radio station . . . 

  • http://evilspeculator.com molecool

    Did you hear about the scrapped CMBS deal by Goldman?

  • http://practicalt.blogspot.com/ Gold_Gerb

    news don’t matter.
    what gives me the jeebies is it’s month end.
    hard to imagine painting the tape. but let’s not be paranoid, noooo.

    http://www.bloomberg.com/news/2011-07-28/goldman-sachs-citigroup-scrap-cmbs-that-s-p-won-t-rate-1-.html

    Toxic comes to mind.

  • Anonymous

    NPR just called this a “bright spot” in the job market…

  • http://practicalt.blogspot.com/ Gold_Gerb
  • Anonymous

    Bought AUG SSO puts. 1,297 still possible but like this entry pt.

  • Anonymous

    Sorry, should be longs.

  • Anonymous

    Oooooooo yeah.

    I love the headline number.  Of course the devil is in the details.

    http://finance.yahoo.com/news/Jobless-claims-fall-below-rb-3944272671.html;_ylt=AtrtMA.8fHnBCj04t2wrSYu7YWsA;_ylu=X3oDMTE1ODgzcDY5BHBvcwMzBHNlYwN0b3BTdG9yaWVzBHNsawNqb2JsZXNzY2xhaW0-?x=0&sec=topStories&pos=main&asset=&ccode=

    “The number of Americans on emergency unemployment benefits rose 18,427 to 3.17 million in the week ended July 9, the latest week for which data is available”

    “A total of 7.65 million people were claiming unemployment benefits during that period under all programs, up 320,152 from the prior week.”

  • Anonymous

    Oooooooo yeah.

    I love the headline number.  Of course the devil is in the details.

    http://finance.yahoo.com/news/Jobless-claims-fall-below-rb-3944272671.html;_ylt=AtrtMA.8fHnBCj04t2wrSYu7YWsA;_ylu=X3oDMTE1ODgzcDY5BHBvcwMzBHNlYwN0b3BTdG9yaWVzBHNsawNqb2JsZXNzY2xhaW0-?x=0&sec=topStories&pos=main&asset=&ccode=

    “The number of Americans on emergency unemployment benefits rose 18,427 to 3.17 million in the week ended July 9, the latest week for which data is available”

    “A total of 7.65 million people were claiming unemployment benefits during that period under all programs, up 320,152 from the prior week.”

  • Schwerepunkt

    Yes, more bad news for housing market, banks AND the ratings agencies. Plenty of shite flying around these days.

  • Schwerepunkt

    Yes, more bad news for housing market, banks AND the ratings agencies. Plenty of shite flying around these days.

  • Anonymous

    I wonder why S&P won’t rate a bunch of mortgage bonds? … makes you think….

  • Anonymous

    I forgot to mention this yesterday.  But so much for the Summer Driving Season.  

    Oil Inventory Report 7/27/2011

    Crude                     UP 2.3 Million Bls.

    Gasoline                 UP 1 Million Bls.

    Distillates               UP 3.4 Million Bls.

    Refinery Utilization   DOWN 2%

    http://energy-reporter.org/

  • Anonymous

    NFLX on que:)

  • Anonymous

    SPX 1320 “looks” like a good stopping point for any rally, based on Fib .382 off low of 1303.49, AND, channel down from 1347.  Sorry, I’m not technical enough to make a chart to post.

  • Anonymous

    SPX 1320 “looks” like a good stopping point for any rally, based on Fib .382 off low of 1303.49, AND, channel down from 1347.  Sorry, I’m not technical enough to make a chart to post.

  • Anonymous

    That’s my exit target for my long options.

  • raised_by_wolves

    As of yesterday, S&P 500 Percent of Stocks Above 200 Day Moving Average = 55.80%

    http://content.screencast.com/users/raised_by_wolves/folders/Jing/media/ed978263-691a-4039-88be-2c0babb7e2e2/00003563.png

  • Anonymous

    Exited at 1,316.

  • Anonymous

    1319 is also FIB .382 from 1295.92 to 1356.48

  • Anonymous

    approaching VWAP

  • Schwerepunkt

    7-yr note auction was ok, but not great. BtC only 2.63. Indirect bid 39.6%

  • Schwerepunkt

    Hmmm . . . stubbornly staying couple points above VWAP, although it’s only 1pm.

  • http://practicalt.blogspot.com/ Gold_Gerb

    did you get paddled today?
    not an exact science, but close enough.
    price likes to swing between fan lines.

    http://i56.tinypic.com/2ynjfbp.png

  • http://practicalt.blogspot.com/ Gold_Gerb

    my pappy taught me, create a buy list ahead of time.
    when you get down in the 20 range, start buying.

  • Schwerepunkt

    What’s her name and number?  ;^]

  • http://practicalt.blogspot.com/ Gold_Gerb

    she got busted in that call girl sweep last week.
    too bad, she only spoke German.
    😉

    speaking of, I’ve got a hankering for sauerkraut!

    http://www.youtube.com/watch?v=IKv38Hu9K0w&NR=

  • http://practicalt.blogspot.com/ Gold_Gerb

    any of you guys remember my obsession about the March 1 candle back in oh, April/May?

    well, did you look at the drop yesterday?

    I present – Exhibit A

    http://tinypic.com/r/5dq9g7/7

    that’s right rats, something….dam. new post!

  • http://evilspeculator.com molecool

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