8 replies to this topic

[Insider]

Judgement Day - GDP Advance 08:30 ET July 27

INSIDER

Edited by Insider, 23 July 2007 - 03:16 PM.

[ChickenLittle]

I'm not ready for Judgement Day, I've been sining too much.

[arbman]

Insider, I am thinking the market will sell off to that day and rally on the bad news, just like they bought the rumor and they are now selling the news. This is a trading range and this is probably the top of the range, imho. I do not expect a major break down here, it would be very odd since the new highs and trending issues are still quite high despite the relative deterioration the market had for the past month. What the market needs to fix in order to advance is the retail speculation, every 10 SPX points advance finds another barrage of call buying...

[relax]

inflation data has been the most important type of data for my charts as expected or lower core inflation has led to new highs i can't really figure out which sort of impact GDP will have the fact that we are seeing earnings actually disappoint, may put more negative focus on the laggring effects of weak GDP growth on the other hand a strong figure should cause a rebound in the dollar, but then again we have been building up for a strong Q2 GDP figure for quite a while, so there should be now positive surprise if growth is above 3 per cent man i don't know - i just don't see a big sell off of more than 7-8 per cent unless core inflation starts showing +.3 some months in a row nonetheless a 4-5 per cent move down is really in the cards - S&P 500 should do what the DAX has done for the past weeks we will not move higher until the DAX signals it by moving past 8.150

[arbman]

High inflation is not that bad for the indices actually since they are heavily weighted by the energy and materials now. The perception about the tech is that it is immune to inflation. In the mean time speaking of inflation, the investment grade high volume spreads breached about 125bp today. So, there was further deterioration in the bond markets as the rates went higher. The junk yields are calling for a correction according to the March 2005 comparison, but if the spreads abruptly reverse from here, it could also mean a very strong bottom since, I agree, the market is really showing a lot of resilience here although the credit conditions are much worse than a month ago... You would not expect the markets to rally here, but at least consolidate for a few more weeks and there is more reason due to the speculation in the markets... - kisa

[pdx5]

This type of market needs a catalyst to change direction. The direction is up and it will stay that way with a few down days sprinkled in between. The bears need a LTCM type of news to score. If and until that happens there is no point in riding the bear. Earnings growth is lower than last year but earnings are still far from being in real negative territory. That looks bullish. The interest levels are still historically quite tame and until long bond approaches 6%, should have little concern for the bulls.

[arbman]

BTW, when I look back to last December, they knew this was coming long before the suprime disasters. The money left the markets back then for the first time. Now, what we are learning here is they discounted the problems ahead of the time and the ugly credit news only served as the wall of worry in spring. The market is about building the supports and advancing from them in bull markets, when the bad news come out, the short selling only helps to accelerate the trend. This is exactly what happened. Having this perspective, I look back over the past 2 months and see whether they did anything to build their supports ahead of the earnings season, actually they did. The shorts again tried to follow the downtrend that was ending and they got easily burned. But something unexpected might be now happening, and that's the retail is becoming smart enough to figure out the game and speculate long on the bad news! I doubt that it will be that easy for them, the market loves to take the little guys' money; so the newly arriving customer asks; 'where are the customers' yatchs?' --google it for the famous WS story - kisa

[brasilstocks]

nonetheless a 4-5 per cent move down is really in the cards - S&P 500 should do what the DAX has done for the past weeks

we will not move higher until the DAX signals it by moving past 8.150

the Dax been very close to the 55d MA today and looking back until may's low I'd say today could have been another bottom prior to a move into new highs

http://stockcharts.com/c-sc/sc?s=$DAX&p=D&b=5&g=0&i=t28291407761&r=4956.png

[Rich]

Judgement Day - GDP Advance 08:30 ET July 27

INSIDER

Briefing.com is calling for a little more than three percent. I'm guessing that's about right. I don't think there will be a big reaction to the actual number, unless there's an awful (or pleasant) surprise. We'll see.


Rich