NexusFi: Find Your Edge


Home Menu

 





ARE WE NEARING A CYCLICAL TOP IN THE S&P 500?


Discussion in Traders Hideout

Updated
      Top Posters
    1. looks_one tigertrader with 4 posts (6 thanks)
    2. looks_two twoshepards with 3 posts (5 thanks)
    3. looks_3 Silvester17 with 1 posts (2 thanks)
    4. looks_4 Slipknot511 with 1 posts (1 thanks)
      Best Posters
    1. looks_one Silvester17 with 2 thanks per post
    2. looks_two twoshepards with 1.7 thanks per post
    3. looks_3 tigertrader with 1.5 thanks per post
    4. looks_4 Big Mike with 1 thanks per post
    1. trending_up 6,627 views
    2. thumb_up 16 thanks given
    3. group 2 followers
    1. forum 10 posts
    2. attach_file 3 attachments




 
Search this Thread

ARE WE NEARING A CYCLICAL TOP IN THE S&P 500?

  #1 (permalink)
 
tigertrader's Avatar
 tigertrader 
Philly, Pa
Legendary Market Wizard
 
Experience: Master
Platform: NinjaTrader
Trading: ES, ZB
Posts: 6,482 since Jul 2010
Thanks Given: 6,662
Thanks Received: 36,257

Are we nearing the top of the March 2009 cyclical rally, which is part of the secular bear market that began in 2000?

Monthly chart of the SPX, it is approaching major resistance at the 50MA at about the 1200 level.

Daily chart of the SPX , both the rate of change and money flow index, started to fall about mid September, as the market continued to rally. This suggests that the "smart money" was selling into the rally.

Daily chart of the VIX w/ 5period RSI, the VIX is approaching 6 months lows and very oversold readings.

Attached Thumbnails
Click image for larger version

Name:	97b3e213b830eac180e69d97e083f2ac.png
Views:	206
Size:	13.8 KB
ID:	22604   Click image for larger version

Name:	bbbe79348addee415ede16798fdffa71.png
Views:	216
Size:	29.1 KB
ID:	22606   Click image for larger version

Name:	efe6f7ccc53c605a6425f8e6ab185a44.png
Views:	205
Size:	17.8 KB
ID:	22608  
Follow me on Twitter Started this thread Reply With Quote
The following user says Thank You to tigertrader for this post:

Can you help answer these questions
from other members on NexusFi?
NexusFi Journal Challenge - April 2024
Feedback and Announcements
Request for MACD with option to use different MAs for fa …
NinjaTrader
ZombieSqueeze
Platforms and Indicators
My NT8 Volume Profile Split by Asian/Euro/Open
NinjaTrader
 
Best Threads (Most Thanked)
in the last 7 days on NexusFi
Retail Trading As An Industry
58 thanks
Battlestations: Show us your trading desks!
55 thanks
NexusFi site changelog and issues/problem reporting
48 thanks
What percentage per day is possible? [Poll]
31 thanks
GFIs1 1 DAX trade per day journal
29 thanks

  #2 (permalink)
 
Big Mike's Avatar
 Big Mike 
Manta, Ecuador
Site Administrator
Developer
Swing Trader
 
Experience: Advanced
Platform: Custom solution
Broker: IBKR
Trading: Stocks & Futures
Frequency: Every few days
Duration: Weeks
Posts: 50,322 since Jun 2009
Thanks Given: 33,143
Thanks Received: 101,477


tigertrader View Post
Tried uploading the video, but couldn't. Is there any way to do so.?

mp4 and avi files are not accepted. Just zip it first, then upload the zip. Zip files up to 256MB are accepted fine.

Mike

We're here to help: just ask the community or contact our Help Desk

Quick Links: Change your Username or Register as a Vendor
Searching for trading reviews? Review this list
Lifetime Elite Membership: Sign-up for only $149 USD
Exclusive money saving offers from our Site Sponsors: Browse Offers
Report problems with the site: Using the NexusFi changelog thread
Follow me on Twitter Visit my NexusFi Trade Journal Reply With Quote
The following user says Thank You to Big Mike for this post:
  #3 (permalink)
twoshepards
Chicago, Il
 
Posts: 21 since Jul 2010
Thanks Given: 3
Thanks Received: 20


The VIX chart is pretty damning for the market. Vol is getting crushed. I don't think ESZ0 will clear 1200 and think we'll move back to 1040.

Reply With Quote
The following user says Thank You to twoshepards for this post:
  #4 (permalink)
 
tigertrader's Avatar
 tigertrader 
Philly, Pa
Legendary Market Wizard
 
Experience: Master
Platform: NinjaTrader
Trading: ES, ZB
Posts: 6,482 since Jul 2010
Thanks Given: 6,662
Thanks Received: 36,257

I hear what you're saying, but "investors" seem to be high on "QE2hopium" for the time being. Hard to tell if QE2 has been fully priced into the market, but when it is ...look out below.

Follow me on Twitter Started this thread Reply With Quote
  #5 (permalink)
 vegasfoster 
las vegas
 
Experience: Intermediate
Platform: Sierra Chart
Broker: Velocity/IB
Trading: 6E
Posts: 1,145 since Feb 2010
Thanks Given: 304
Thanks Received: 844

it's one of those tea cup and handle things, we're going all the way to 2500!

Reply With Quote
  #6 (permalink)
 aviat72 
San Francisco Bay Area
 
Experience: Intermediate
Platform: NT,TOS,IB
Trading: ES,CL,TF
Posts: 281 since Jun 2010
Thanks Given: 161
Thanks Received: 273

Money Flows: Selling on Strength - Markets Data Center - WSJ.com

Selling on Strength day

Visit my NexusFi Trade Journal Reply With Quote
The following user says Thank You to aviat72 for this post:
  #7 (permalink)
 
tigertrader's Avatar
 tigertrader 
Philly, Pa
Legendary Market Wizard
 
Experience: Master
Platform: NinjaTrader
Trading: ES, ZB
Posts: 6,482 since Jul 2010
Thanks Given: 6,662
Thanks Received: 36,257

"it's one of those tea cup and handle things, we're going all the way to 2500!"


For that to happen, QE2 would have to be a an enormous success, i.e., have a positive effect on the real economy and a positive effect on money supply and the velocity of money so that it could create inflation.

QE1 failed to reverse deflation and failed to create job growth or create new business investment, because the money went into the coffers of the banks, which failed to lend it out. Money supply actually shrank, as investors continued to deleverage.

All QE2 is going to accomplish is to push more money into bloated bank reserve accounts. Adding more reserves to a banking system that already has more reserves than it can use has no net effect on the money supply. It's like Bill Gates making more money and expecting that his lifestyle will become bigger.

The market may be rallying for the moment as investors front run the Fed, but as Hendrix wrote, the real economy is "like a castle made of sand" and sandcastles all fall into the sea...eventually.



Follow me on Twitter Started this thread Reply With Quote
The following 3 users say Thank You to tigertrader for this post:
  #8 (permalink)
twoshepards
Chicago, Il
 
Posts: 21 since Jul 2010
Thanks Given: 3
Thanks Received: 20

QE2 will be a big failure. Institutional investors know that, mom and pop invstors don't. Mom and pop may even pick up their ira/401k/mutual fund investments while the portolio manager buys stocks to put the money to work, the pm is selling vol on top to hedge.

Reply With Quote
The following user says Thank You to twoshepards for this post:
  #9 (permalink)
 
Silvester17's Avatar
 Silvester17 
Columbus, OH
Market Wizard
 
Experience: None
Platform: NT 8, TOS
Trading: ES
Posts: 3,603 since Aug 2009
Thanks Given: 5,139
Thanks Received: 11,527


twoshepards View Post
QE2 will be a big failure. Institutional investors know that, mom and pop invstors don't. Mom and pop may even pick up their ira/401k/mutual fund investments while the portolio manager buys stocks to put the money to work, the pm is selling vol on top to hedge.

very true. totally agree.

but here's the problem. I would say 8 out of 10 institutional investors agree with you, QE2 will be a big failure. but now a big surprise, QE2 is not as bad (whatever reason). guess what, those 8 out of 10 institutional investors will have to cover the shorts or chasing the markets. and mom and pop live happily ever after.

Reply With Quote
The following 2 users say Thank You to Silvester17 for this post:
  #10 (permalink)
twoshepards
Chicago, Il
 
Posts: 21 since Jul 2010
Thanks Given: 3
Thanks Received: 20


The funds are not 'shorting' the market. They're covering their exposure but selling calls versus the underlying long posions. As they can deliver the long vs. the short call, they're risking not participating on an extended rally. I think SPX 1200 will be a big tell. If we rocket higher after closing above it, they're getting back in vs. short 1200 calls. I think resistance will hold and we won't get there, but time will tell.

Reply With Quote
The following 3 users say Thank You to twoshepards for this post:





Last Updated on October 13, 2010


© 2024 NexusFi™, s.a., All Rights Reserved.
Av Ricardo J. Alfaro, Century Tower, Panama City, Panama, Ph: +507 833-9432 (Panama and Intl), +1 888-312-3001 (USA and Canada)
All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
About Us - Contact Us - Site Rules, Acceptable Use, and Terms and Conditions - Privacy Policy - Downloads - Top
no new posts