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Finally, the POWELL PUT comes, BULLS on the rampage!


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#1 dTraderB

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Posted 05 January 2019 - 02:16 PM

It had to come, was only a matter of timing, and what better time than early January after a harrowing December and Q 4 for the bulls. 

One thing you learn quickly in these market is that the BULLS have the inherent advantage and you go with the market, even if you have to hold your nose and buy when the market takes off! 

 

Many are attributing the EPIC bounce to the NFP report but it was rally the POWELL speech and no matter what you are told you must understand and learn that nothing is absolutely secret in Wall St. Wink wink wink....

 

ST trend is up, IT LONG will be triggered with a daily close above SPX 2568, and LT Short is still in effect until a daily close above SPX 2645 (these are adjusted after each day's close).

 

But, all this TA stuff is almost meaningless in the current super-heated global political environment so you have to be on the alert to swiftly reverse and go with the market if it changes direction.

 

This is the SPX hourly chart, not MA "crossover signals" but to put the current price in relation to the most-watched averages. 

 

YELLOW is the 20ma, MAUVE is the 50ma

 

The CYAN line is my NO-BS alert that reminds me of the VST trend in an hourly basis and demands I convince myself why I am short if SPX is above it or why I am long if SPX is below it.

 

hspx-jan4.jpg



#2 Dex

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Posted 05 January 2019 - 02:20 PM

This is a news driven market.

 

Earnings reports are important.  More like Apple and the decline will continue.


"The secret of life is honesty and fair dealing. If you can fake that, you've got it made. "
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#3 dTraderB

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Posted 05 January 2019 - 02:22 PM

Powell learned the lesson quickly at the December FED announcement: be as precise as possible but not ABSOLUTE, as in "unwinding QE is on auto"
Lawrence McDonald @Convertbond
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The Words that Moved Markets - Fed Chair Powell on their Balance Sheet Reduction at $50B a Month:

 

"I don't see us changing that" December 19, 2018 Fed Meeting

 

“We wouldn’t hesitate” to change balance sheet policy if needed." January 4, 2019 (the Fed Cave-athon contnues)

4:03 PM - 4 Jan 2019


#4 dTraderB

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Posted 05 January 2019 - 02:25 PM

This is a news driven market.

 

Earnings reports are important.  More like Apple and the decline will continue.

 

Yes, but there is at least a week before the earnings warnings/revisions come in and the momentum is now up; also, 

the Chinese now realize they have to make a deal or at least appear to be doing the negotiations dance; this has assured the market of some progress but this can also go away.

 

I wonder if any of the major banks will warn or lower Q1 earnings estimate?



#5 dTraderB

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Posted 05 January 2019 - 02:27 PM

...and. any hint of progress in the Budget Shutdown will send the markets soaring past SPX 2700

 

On the other hand, failure to resolve this, more earnings bad news, and lack of progress in the Trade War negotiations will send it back down to 

SPX 2350 and possibly to that 2250/60 critical support zone.



#6 dTraderB

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Posted 05 January 2019 - 02:33 PM

Sven HenrichVerified account @NorthmanTrader
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Sven Henrich Retweeted New York Fed

Slowing.

Sven Henrich added,

New York FedVerified account @NewYorkFed
Weekly GDP Nowcast: http://nyfed.org/GDPnowcast  Q4 2018 → 2.5% Q1 2019 → 2.1%
9:47 AM - 5 Jan 2019


#7 dTraderB

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Posted 05 January 2019 - 02:38 PM

SENTIMENT TRADER's analysis appears to be quite bullish

 

SentimenTraderVerified account @sentimentrader
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Prior to today, there have only been 3 distinct times when NYSE Up Volume accounted for 95% or more of total volume twice in 2 weeks:

 

Aug '82: S&P 500 was up 31% six months later

 

Jan '87: Up 21% six months later

 

Aug-Nov '11: Up ~12% six months later

1:21 PM - 4 Jan 2019
The McClellan Oscillator has gone from -70 to +70 in less than 2 weeks. This happened 10 other times since 1962. All 10 saw the S&P 500 higher a year later. Its median return was +21.9%.
Over the past 50 years, when the S&P 500 sunk to a 52-week low, then there were two 90% up volume days within two weeks, the S&P continued higher over the next 3 months 7 out of 7 times, averaging 3.5%.


#8 dTraderB

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Posted 05 January 2019 - 02:40 PM

McClellan Oscillator at one-year high! 

Is this ST bearish? or a one to two day pullback? 

 

Will the market rise until the 3rd week in January and then collapse, as it did in 2018?

 

McClellanOsc_450.gif

 

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



#9 dTraderB

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Posted 05 January 2019 - 02:43 PM

Yeah, but will you fight the FED and the Wall St establishment, or trade with the market and make profits? 

 

 

The Federal Reserve is propping up the market — and here’s the evidence

For years critics of U.S. central-bank policy have been dismissed as Negative Nellies, but the ugly truth is staring us in the face: Stock-market advances remain a game of artificial liquidity and central-bank jawboning, not organic growth. And now the jig is up.

As I’ve been saying for a long time: There is zero evidence that markets can make or sustain new highs without some sort of intervention on the side of central banks. None. Zero. Zilch.

And don’t think this is hyperbole on my part. I will, of course, present evidence.

https://www.marketwa...ruth-2019-01-05



#10 dTraderB

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Posted 05 January 2019 - 02:49 PM

When these guys say BUY, I hesitate and may do the opposite!

 

More bullishness after Q4 and early January panic

 

Oppenheimer’s Wald: The worst of the selloff is behind the market

Tobias Levkovich, chief U.S. equity strategist at Citi, who trimmed his 2019 targetfor the S&P 500 to 2,850 from 3,000, believes this is a good time to jump back into the market, in part given that stocks have the potential to rise 16% over the next 12 months on valuations alone.

Since the S&P 500’s record high in September, the large-cap index has tumbled double digits, making stocks much more affordable.

“Nothing is guaranteed, but the data suggest that we should be buying into current weakness,” he said.

Aside from affordability, there are other encouraging signs, according to strategists at Bank of America Merrill Lynch.

The bank’s Bull & Bear Indicator fell to 1.8, indicating “extreme bear,” triggering a buy signal for risky assets like stocks for the first time since June 2016 when markets were battered by Brexit headlines.

MW-HB376_BAML01_20190104165502_NS.png?uuBank of America Merrill Lynch

Historically, global stocks rose 6.1% in the three months following each of the buy signals triggered going back to 2000.

The next two critical signs to watch for are “policy panic” and a deterioration in profit expectations from the current 7.5% growth.

https://www.marketwa...ists-2019-01-05