Was there any doubt?
“Slovakia Passes EFSF Expansion Vote”
The ‘powers’ always get what they want.
Chart Chatter October 12, 2011
Extreme move, down and out of the range and then zooming right back up to the top. Overbought? You bet.
S&P — 145 points, bottom-to-top, 13.5 percent, in seven days:
Russell — 103 points bottom-to-top, 17.1 percent, in seven days:
Charts courtesy of StockCharts.com
Market Wrap October 12, 2011
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Internals were positive, with volume picking up. Advances/declines were 4 to 1 on the NYSE and 14 to 5 on the Nasdaq, with up/down volume 5 to 1 on the NYSE and 14 to 5 on the Nasdaq. New highs/lows were 17/6 on the NYSE and 25/29 on the Nasdaq.
Leaders — Banks (+3.29%), Steel (+2.74%), Airlines (+2.61%), Broker Dealers (+2.04%), Hospitals (+2.00%), Paper (+1.89%), Metals (+1.89%), REITs (+1.79%)
Laggards — Biotechs (-0.58%), Comp. Hardware (-0.52%), Disk Drives (-0.19%), Utilities (-0.08%), Network (-0.08%), Health Care Products (-0.00%), Natural Gas (+0.43%), Oil Services (+0.46%)
An extensive visual representation of the day’s winners and losers can be found at Finviz.com.
Treasury Yields — 6-Month : 0.04 %, 2-Year : 0.28 %, 5-Year : 1.15 %, 10-Year : 2.21 %, 30-Year : 3.19 %
Energy Prices — Crude oil: $85.02/barrel, Gasoline: $2.74/gallon, Natural Gas: $3.49/mmBTU
US Dollar Index — 76.977
Precious Metals — Gold: $1676.70/ounce, Silver: $32.65/ounce, Platinum: $1549.00/ounce
BMB Note:
More fun and frolic. We had a false breakdown out of the range, and here we are a week later looking at a break-OUT of the top of the range. Crazy? You bet. Extreme? Without a doubt.
But today was a little different — instead of ramping into the close, a last hour selloff cut the indices’ gains about in half.
Scott Bleier on Twitter (@CreateCapital): “don’t forget. We’ve round-tripped SEVEN TIMES in this range in two months. and fast too…” Also from Scott: “BREAKOUT COMING that will fail. Exactly the opposite of the False Breakdown last week”. We’ll soon see if he’s right.
With many stocks and sectors still in downtrends, this still has the look and feel of a huge short-covering rally. So we’re still looking at adding shorts — but not too many, with the indices back in/near the top of their ranges — and waiting for entries to try and stay safe. As Dave Landry said this morning in his newsletter:
I still think the short side is the way to play but don’t fight the tape. Make sure you wait for entries. As I preach, that in and of itself can often keep you out of trouble. Also, avoid getting too aggressive until we see some follow through in the overall market.
It Was Nice October 12, 2011
…to be a bank, for a while — when it was convenient and we could get free money from the gov’t to save our sorry asses. But now, not so much:
Goldman Sachs (NYSE:GS – News) and Morgan Stanley (NYSE:MS – News) may shed the “bank holding company” classification in order to skirt the Volcker rule banning propriety trading with the firm’s own capital, according to Susquehanna Financial Group analyst David Hilder.
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This exit may draw the ire of everyone from legislators to the Occupy Wall Street crowd as Goldman and Morgan Stanley changed their status during the height of the financial crisis following the collapse of Lehman Brothers in Sept. 2008 in order to get access to emergency funds not provided for non-commercial banks.
The Federal Reserve rushed through these applications on a Sunday, saying in a statement that in order “to provide increased liquidity support to these firms as they transition to managing their funding within a bank holding company structure, the Federal Reserve Board authorized the Federal Reserve Bank of New York to extend credit to the U.S. broker-dealer subsidiaries of Goldman Sachs and Morgan Stanley against all types of collateral that may be pledged at the Federal Reserve’s primary credit facility for depository institutions or at the existing Primary Dealer Credit Facility.”
Frickin’ crooks.
Link from @tourspin and @CreateCapital on Twitter.
Bad Behavior October 12, 2011
Dave Landry, from his morning newsletter:
The indices are due to correct from this overbought condition. The nature of this correction will be important. If the market sells off just a bit and stabilizes, then it’s just that, a correction. However, if the market sells off in earnest, all of those who picked the bottom and/or felt it was the “all clear” might all run for the door at the same time. Remember, the market often rewards (and later punishes) bad behavior such as bottom picking.
Overall, most sectors remain in downtrends. The only caveat is that the momentum has slowed in some areas. Not enough to get excited about–it’s just that some have gone more sideways than lower as of late.
Tweets October 12, 2011
Just a few nuggets from the Twitter stream this morning:
Scott Bleier @CreateCapital: “It’s just a coincidence that the dollar tanks, bonds tank and everything else rises. No interconnectedness!****************”
Joe Saluzzi @JoeSaluzzi responds: “@CreateCapital One giant, correlated systemic risk prone web of chaos.”
Scott Bleier @CreateCapital: “don’t forget. We’ve round-tripped SEVEN TIMES in this range in two months. and fast too…”
@zentrader: “Why do the markets always overshoot the mark….”
My response @bmbull: “RT @zentrader: Why do the markets always overshoot the mark…. <- To cause the most pain to the most people."
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Do Over October 11, 2011
Slovakia’s Parliament rejected a key euro bailout bill Tuesday, threatening Europe-wide efforts to ease a debt crisis that is threatening the global economy. The vote triggered the collapse of the government, but the outgoing prime minister and her main opponent both said they would now work to approve the bill quickly.
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But the statements of the country’s leading politicians late Tuesday left little doubt the Slovakian Parliament would approve the measure.
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Fico took the same line. “Slovakia has to approve the fund,” he said.
Fico and his party had always supported expanding the fund expansion in principle, but had said it would vote yes only if the government agreed to call early elections.
So, they’ll just vote again, and change their mind.
Duct tape. Wrap head. Tightly.
Chart Chatter October 11, 2011
Netflix — the stock that just wouldn’t die for the longest time — has given up two-thirds of its value in three months:
Chart courtesy of StockCharts.com
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Market Wrap October 11, 2011
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Internals were positive, with volume around yesterday’s levels. Advances/declines were 5 to 4 on the NYSE and 3 to 2 on the Nasdaq, with up/down volume 3 to 2 on both exchanges. New highs/lows were 17/9 on the NYSE and 20/49 on the Nasdaq.
Leaders — Airlines (+3.12%), Metals (+1.54%), Transport (+1.27%), Comp. Hardware (+1.22%), Network (+0.93%), Software (+0.86%), Internet (+0.77%), Comp. Tech (+0.70%)
Laggards — REITs (-2.00%), Utilities (-1.06%), Paper (-0.61%), Health Care Products (-0.60%), Natural Gas (-0.59%), Drugs (-0.57%), Insurance (-0.52%), Semis (-0.30%)
An extensive visual representation of the day’s winners and losers can be found at Finviz.com.
Treasury Yields — 6-Month : 0.03 %, 2-Year : 0.30 %, 5-Year : 1.13 %, 10-Year : 2.16 %, 30-Year : 3.11 %
Energy Prices — Crude oil: $85.15/barrel, Gasoline: $2.74/gallon, Natural Gas: $3.61/mmBTU
US Dollar Index — 77.512
Precious Metals — Gold: $1666.50/ounce, Silver: $32.20/ounce, Platinum: $1519.00/ounce
BMB Note:
Pretty much a snoozer.
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All One October 11, 2011
Seen on Twitter: “83% of stocks move up or down with the S&P 500 each day, correlation now at an 80-year high – Jim Bianco”
And you can add bonds, oil, the Euro…
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