5 replies to this topic

[Tor]

commercials added to longs SPX. All FWIW. They have been long all thru this rally. They trade medium terms as far as I can see.

[gorydog]

Note that the commercials were net long into the crash in 2000. Puts prop up the market and limit downside. As put protection is removed, a bigger drop becomes possible. I have been long with leverage (with some losing shorts in housing) for some time now. but the endgame is shaping up. Still enough shorts and liquidity for at least a few up months. There will have to be an unexpected external event to turn the tide, but buying out-of-the-money put protection is looking better to me each week. GD

[robo]

Note that the commercials were net long into the crash in 2000. Puts prop up the market and limit downside. As put protection is removed, a bigger drop becomes possible. I have been long with leverage (with some losing shorts in housing) for some time now. but the endgame is shaping up. Still enough shorts and liquidity for at least a few up months. There will have to be an unexpected external event to turn the tide, but buying out-of-the-money put protection is looking better to me each week.

GD

http://www.optionstr...line/charts.asp


I still have a small long position, but have been scaling back to neutral as the Market keeps climbing. However, I'm a pretty conservative investor. Any thoughts or opinions on these charts.

[gorydog]

[/quote]
http://www.optionstr...line/charts.asp
I still have a small long position, but have been scaling back to neutral as the Market keeps climbing. However, I'm a pretty conservative investor. Any thoughts or opinions on these charts.
[/quote]


Sure...we approach a top, just when and how to play it is the question. I think the put/call data may reflect hedging, just as I mentioned. If the COT was negative, or if money flow drops, I'll flip to short. But I think this is a rolling correction, bears have not gotten ther upper hand, coiling for a break higher. As for why, IDK. I don't see what is propelling the market, but up is the path of least resistance. I wonder if all the liquidity is from derivatives that have defacto printed huge reams of money.

GD

[wyocowboy]

The big difference in COT data is how short they were going into the Feb.27 correction - and now covering and going long. But one indicator does not a market make - other data supporting a longer term long position is insider trading, short interest, junk bonds holding steady, and sentiment surveys. The other side of the coin is recent breadth, and high/low data. P/C data could go either way depending on your time frame.

[Tor]

The big difference in COT data is how short they were going into the Feb.27 correction - and now covering and going long. But one indicator does not a market make - other data supporting a longer term long position is insider trading, short interest, junk bonds holding steady, and sentiment surveys.

The other side of the coin is recent breadth, and high/low data. P/C data could go either way depending on your time frame.

Agreed, but they look bullish to me.