20 replies to this topic

[dTraderB]

Powell was anything but dovish although some are already trying to spin it as "it's data-driven" so forget his statement about 2 more hikes in 2019. 

Expect more spin and lots of walking back by FED people. 

 

Market bounced off the SPX 2490 level but even though I mentioned this as a downside target recently and possibility of a SPX 2400 handle I did not expect it this week! 

 

There will be attempts at rallying, there will be rallies as high as 2750, but unless there is a definitive change in FED tone and intentions, the bear is here to stay. In such an environment, sell the rallies but you must be very patient and also trade long during the rallies because as we all know: bear market rallies can be short, sharp, and brutal.

 

So, will Trump fire Powell? No. Seriously, no.

 

In summary, unless there is credible and definitive change in the FED's stance, markets will be down with sharp rallies. 

 

 

 

[dTraderB]

He is a ST trader ..... I would also buy the spikes down but would focus on selling the rallies

 

• Douglas Kass‏Verified account @DougKass 1h1 hour ago

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  On @realmoney The Emergence of Fear Presents Opportunity We have now dipped to levels (that on a reward/risk basis) where I believe a reasonable year end rally is possible. I like my last entry point in my $SPY and $QQQ trading longs (at under $251 and $155, respectively)

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Douglas Kass‏Verified account @DougKass

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and, this time, I suspect the short term upside may be more than the $2-$3 gain achieved on the last two trades. I recognize how difficult it is (emotionally) to buy into this sort of weakness but trading opportunistically requires you to leave your emotions at the door.

12:35 PM - 19 Dec 2018 from West Palm Beach, FL

[dTraderB]

Peter Schiff says we’re not in a bear market, ‘we’re in a house of cards that the Fed built’

Schiff says that this time the crisis part deux will be worse and that policy makers have essentially papered over problems and set the stage for an economy that is unable to cope with higher interest rates after a decade of easy-money policies.

“Markets are starting to crack as this debt is getting more expensive to service,” he said. “We built this gigantic bubble on this unprecedented amount of cheap money and quantitative easing, and now the hangover will be much worse,” Schiff said.

Beyond the Euro Pacific investor’s disapproval of the Fed, now, critiquing monetary policy makers and Jerome Powell specifically has become a novel pastime on Wall Street.

The Wall Street Journal’s editorial board on Tuesday made the case that the Fed needs to pause its interest rates hikes, which appeared in the publication a day after the duo of hedge-fund luminary Stanley Druckenmiller and Kevin Warsh, a former Fed official, made a similar entreaty in an op-ed titled Fed Tightening Not Now.

Schiff says it won’t matter what the Fed does Wednesday (policy makers tightened as expected), with a rate increase of a quarter percentage point anticipated. “I think what’s going to happen is the Fed is ultimately going to take rates back to zero,” he said.

https://www.marketwa...uilt-2018-12-19

[dTraderB]

Dow Drops 352 Points After Fed Refuses to Go Soft

The market started the day up strongly, but quickly plummeted after the Federal Reserve came out more hawkish than many hoped.

 

TREASURIESREAL TIME ANALYSIS

Fed Leaves Door Open to More Hikes, Market Feels a Cold Draft

There was no “one and done” statement from Fed Chairman Jerome Powell & Co., and the press conference left stocks deeply in the red.

[dTraderB]

We will see sharp rebounds in this and also the markets but look out for many days of minus 300 and lower

 

 

https://www.mcoscill...t_breadth_data/

[dTraderB]

Tim is bullish:

 

We have been posting this statement the last five weeks, “Since 1950 the change from October low through year-end average=10.7% gain (with no losses) during mid term elections years (@theonedave). The 10.7% average from the October low would give a target near 289 on the SPY (2890 SPX).” This could be the first failure.  Having said that, turn your attention to the chart above, which is the 3-day average of the Tick/TRIN ratio. Since the mid-October low, the "3-day average of the Tick/TRIN ratio" had not generated a signal until today. The signals in the past have worked out relatively well. The current bullish signal goes well with the bullish Equity Put/Call and Total Put/Call ratios that have been generated in the last couple of days. This is option expiration week and December expiration has a 75% probability of being higher. Also, the month of December is higher 75% of the time. The FOMC announcement is tomorrow, which could be the catalyst for a rally. We did buy SPY “calls” today as it would seem odds are good for a rally from here.

https://stockcharts....er-18-2018.html

[LMF]

You have to watch out for put/call analysis.....it's usually meant for conditions above the 200 day MA.  Pullbacks that are bullish, with the 200 day MA rising.  Not the conditions we have now. 

 

Today had to be the secret test to identify suspect members of the FOMC that voted for a rate hike.  Every one that did needs to be put on administrative leave for the next 12 months.   

[dTraderB]

I cannot understand the logic of 2 interest rate hikes in 2019, especially since the FED admits the economy will weaken. 

 

Does the FED believes the worsening debt situation and decreasing confidence in the markets are minor problems? 

 

This FED statement and tone of the Press Conference today has to go down as one of the most damaging and harmful to the markets and economy.

 

They seem to be living in their own narrow theoretical world.

 

All they had to do was this:

-- raise rates today, as was expected, and already baked in the markets, and then simply say any possible rate hike in 2019 will depend on the data that is available at that time. That would have been consistent with their data-driven approach that they have touted and also assured the markets that future interest rate hikes are not a given but will depend on future data. That is the most sensible policy since you are not putting out in December 2018 the preconceived 2 rate hikes in 2019, but will analyse the data and then decide. 

 

Schuldensuehner

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The end of Fed put: Fed chair Powell takes on Trump w/another rate rise & shocks the markets as he didn’t placate investor anxieties. To the extent anyone had any risk appetite in the final couple of weeks in the year, that is now entirely gone. https://www.welt.de/wirtschaft/article185818974/Schock-an-their-Wall-Street-Auch-their-weisse-Ritter-kann-die-Maerkte-nicht-beruhigen.html?wtmc=socialmedia.twitter.shared.web … via @welt

Edited by dTraderB, 19 December 2018 - 06:53 PM.

[dTraderB]

Markets Revolt as Steadfast Powell Downplays Recent Sell-Off

• S&P 500 careens to 15-month low as Fed chairman speaks
•  
  Dollar firms and Treasury yields tumble on latest policy move

 

The Federal Reserve leaned dovish during its latest policy meeting. Financial markets wanted more.

The S&P 500 tumbled to a 15-month low and investors flooded into Treasuries after Fed Chairman Jerome Powell signaled the central bank saw little threat to the economy from the recent turmoil on financial markets.

 

“It wasn’t as dovish as they’d hoped,” Peter Jankovskis, co-chief investment officer at Oakbrook Investments, said by phone. “Why are they continuing to do this given the volatility we have in the market? Why don’t they sit and take a pause now?”

 

 

https://www.bloomber...recent-sell-off

[CLK]

You have to watch out for put/call analysis.....it's usually meant for conditions above the 200 day MA.  Pullbacks that are bullish, with the 200 day MA rising.  Not the conditions we have now. 

 

Today had to be the secret test to identify suspect members of the FOMC that voted for a rate hike.  Every one that did needs to be put on administrative leave for the next 12 months.   

 

 

 

So, 5x off the 09 lows not enough ? What would be a fair number. 5k, 10k S&P ? Markets can't be allowed to just turn into another Bitcoin without bear markets regularly. People are upset because there is no safe spot to buy the dip now. Just be glad most bear markets are over in 2-3 years. I personally want another chance to buy cheap for the long term in cash positions and not have to rely so much on leverage to try to catch the last 10% of a bull market.

Edited by CLK, 19 December 2018 - 06:59 PM.