Stock Indices…are the tail end of the dog. The trade is terrible with the same grinding action. We have a weekly swan dive that is short lived. The opportunity is in the underlying instruments. Seemingly, everyday the dance partners change with a different sector leading the days action. It’s a stock pickers Nirvana.
Spu’s…show a double top @ 1377, this is the last hope regarding Chart patterns for the Bears. 1369-71 will be the early pivot.
NASD…is now so heavily weighted with AAPL, I wouldn’t be surprised to see 2800 In the futures, which is the 2001 high, before the market is ready for a good break. Keep watching AAPL as a barometer of NASD health.
The SPU/BONDS have been a one way ticket since the qtrly Bond expiration in Dec. The spread appears to have room on the upside. It could take another week or two of price action before we get any signs that this spread is ready to change direction.
OIL…Day Traders…107.85-50 looks to be the lowest risk buy level the first time down. We’ve already taken the Fat out of this trade. Look to take your money on 80 cent swings, then re access.
Currencies…there is little upside follow through in the Dollar near term. USD/CAD is quietly putting in a ORL week with a close below 99.06 USD/CAD. We’re going to let these gestate for a bit before we get re involved.
EURO..has the most trad able pattern with the first yearly retrace Fib @ 131.50. Short term congestion @ 132.35 ish can create bounces.
Until then, ride the Wave…until such time, as we get some concrete evidence of a high.
I am looking at the AG names for dance partners today.
DBA…breaks out on a qtrly chart with sustained closes over 29.66.
AGU..ORH week with a close over 86, looking to tgt just over 90.
SDS…for those of you that are still in, let the 15.80 stop be elected intra day. As they say in NY, Fahghet AHbout it!
To sum up…I don’t have a burning desire to do anything. The opportunity,Long or Short, are in the individual names.
Model Trading Portfolio…Current Holdings
……………… Stop Close Profit Points
Short EUR/USD 134.10 131.50/130 70
Long JJG 45 48 ish
Short Term View
Location ,Location,Location….if you have a good trad able pattern “Good Risk reward!” You just have to seize the opportunity and see what develops!
Trade to Make Money!
Medium Term View…
30 Yr. Bonds …147 is the all time high in the front month futures. We will watch price action off this level for any potential surrogate moves in the currencies or stock indices. 144.20 ish now becomes our macro pivot. All new closing strength over 145.20 would have us looking for more upside in the Bonds. Closing above this level would be short term positive the Bonds and negative the Equities.
We’re going to be eyeballing a “possible” Long over the next couple of weeks via either the 30 Yr. Futures of the TLT ETF. We will be monitoring the Spu/Bond spread to confirm a trad able level. While the markets could certainly turn at month end, the week after could provide the better opportunity. Since we only trade what is in front of us,we’ll wait for a proper setup to initiate.
Equities…We will continue to strategically buy hard breaks in Etf’s and individual instruments we feel have the best risk profiles going into the end of the first qtr.
Currencies…Our view is the Aussie Dollar remains a most attractive investment. The Bonds are high yielding making this currency desirable on breaks. It also has the benefit of the underlying commodity and Asian growth story to support buying the dips.
The Aussie typically mirrors the S&P 500 which also makes it an easy surrogate to trade, whether Risk On or Risk off. It’s liquidity makes it easy to hedge currency risk if you’ve the underlying Bonds, which makes you Long Aussie by default.