Thursday, August 21, 2014

UPDATE: Weekly/Daily XOIL breaks long term trend line > implications?

UPDATE: September 3, 2014 > price has broken back above the trend > meaning > there is less price congestion at that level and the trend line has lost 'significance' or the price level breach was an incorrect signal, and price must again remain above the trendline.  Hammer candle in downtrend could mean reversal.  Watching and learning.




Friday, March 21, 2014

UPDATED: SPX 15min/hourly chart Triple Rejection from 1880 level

UPDATED:  April 21, 2014:  The market has continued to struggle with advancing past this level.  While it did make a run for 1900, rejection was swift and unequivocal, including with a confirmatory support has become resistance with the bounce into April 9-10.  We're back at that level again.  What is the high probability event for you?




Friday, February 7, 2014

So you want to be a market trader? (WSJ)

The advent of high speed computing has given the edge to more than one aspect of human development.  In the financial world, and across global markets, these advantages have been profound.  The co-location of trading houses with the exchanges.  The installation of direct fibre optic data feeds to the trading desks.  And the purchase of direct feeds on news for advance notice of important economic news.  These all provide the basis to an infinitesimally small time advantage, but with the sophistication of modern computing, this almost invisible differential can make all the difference.  As we have also witnessed, these speeds coupled with automation also can result in majestic losses and dramatic blink of an eye price moves.  Watch your stops ~ Trading on.
________________________________________________________________________________


MARKETS

Speed Traders Get an Edge

Paying for Direct Access to News Releases Can Give a Lucrative Time Advantage

Feb. 6, 2014 8:49 p.m. ET
WASHINGTON—High-frequency traders have been paying to get direct access to market-moving news releases, a practice that can give firms the ability to trade fractions of a second ahead of less fleet-footed investors.
The traders are getting news releases from Business Wire, which distributes corporate-earnings releases and economic reports such as the Philadelphia Federal Reserve's monthly manufacturing survey, and from Marketwired, a Toronto company that distributes earnings releases and the ADP monthly employment report.
Such direct access isn't illegal. By paying for direct feeds from the distributors and using high-speed algorithms to crunch data and enter orders, traders can get a fleeting—but lucrative—edge over other investors, according to traders and people familiar with the practice. The reason: tiny lags between the time the distributors release the news and when media outlets send them out to the public, including other investors.

Wednesday, December 11, 2013

UPDATE (21-Dec-2013): SPX Downside? Actually new highs ~

The SPX closed the week @ 1775.04 > very close to the opening price on Friday.  Resistance above @ ~1780 have been approached twice in short timeframes.  General sense is there is likely to be more downside weakness with next support @ ~1750.  Watching and learning.

UPDATE December 21:  While some downside was experienced (to 1767.99), the SPX rebounded strongly, and closed on Friday @ 1819.56 after touching 1823.75 bolstered by taper and employment talk.  This far eclipses previous highs at 1813 a couple of weeks earlier.  If there is a pullback, 1810-1812 should act as support.  Price action has continued to be more than a little schizophrenic, even with the VIX hovering at its baseline @12-14 (recent peak 16 and closing outside BB in October @ 20+).  In more ways than one, this is uncharted territory.  The general sentiment across the globe and a variety of indicators are suggesting another bull run is in the making.  Watching and Learning.


Saturday, November 23, 2013

A trade in CHINA: An update from my perspective

China has remained a central focus in any discussion that talks of global health and wellness.  Either the challenges with it's population or the continued growth model that spawns stories of empty cities, and skyrocketing property values, purely on speculation.  The average Chinese savings rate is claimed to be 50%, considerably more than the global average of 20%.  Significant policy changes are underway.  There is a strong expression by the leadership to better control corruption.  Some rather historic examples are making their way through the system.  There is a strong drive to boost domestic consumption.  One of their most significant challenges is environmental degradation, and particularly clean fresh water and air quality.  With expectations to continue forward at 6-7% growth, these challenges will only become more severe and more difficult to manage for China.  And there is a contingent of global financiers  that have continued to call for the fall of China's economic prowess.  Jim Chanos remains steadfast in his view.

And yet amongst that continuing storyline, there are stories running in parallel that are focused on the likelihood that changes within China will lead to the continuation of this past pattern of growth - current forecasts remain in the range 6-8%.  And the weekly charts below for FXI and SSEC support that notion - there is the potential for both of these instruments to break out above their descending trendline originating in October '08.  Price has been respectful of that line on both charts with many touches and resistance.  Price can certainly continue within the compressed channel, so there are many other potential outcomes.  Which outcome has the highest probability? and aligned by high reward with the least risk?  Watching and learning.




Tuesday, October 29, 2013

Has your favorite coffee beverage gone down in price? (WSJ and FINVIZ)

Historically, coffee prices (ICO Composite Indicator) have been above $1.00/lb though through the 90's a new low was established at $0.41 in 2001 and stayed low through 2004 before accelerating and peaking in 2011.  Today's price hovers above $1.00/lb.

Coffee continues to express all sorts of weakness since peaking in 2011.  Recent news suggests that coffee stores are flush (circa 2009) and prices are not expected to rebound anytime soon.  The crop forecast for Brazil (producing 1/3 global supply) is also good into next harvest (mid-2014).  Expectation by some traders is price will remain depressed until demand recovers, and may hit $100 before there are any substantial improvements in global price.  (WSJ September 2013)

With prices as depressed as they have been, you would think that the price of a cup at your favorite outlet might adjust - though that depends on how much of a cup of coffee is affected by the price of the raw materials - which in many cases is not significant.  The rise in price of energy (i.e., transportation, roasting, etc.) and other factors has likely offset any advantages from lower raw material costs.  Another factor is that companies like Starbuck's negotiates their own coffee supply and prices through private contracts.

Watching and learning.  Trading on.