Retail Bears Battle Real Money

 With each passing day, we continue to read how the markets have gone high enough and how they are sure to pull back. Most of these opinions are coming from retail traders with some charting abilities and writing skills, who, if we were to combine all their money, would still not add up to a hill of beans in the larger scheme of things. Retail bears are hoping to beat Wall Street at their own game.

Retail bears are still looking to catch a wave

 The Dow bent today, but it didn't break. Its trendline held up, and whether or not this can be taken as a bullish sign will be left up to you. It still seems that it is the retail bears looking to short this market as opposed to the big traders with the real money. The "money" doesn't seem to be in any great rush. The breakdowns (if you can call minor pullbacks, "breakdowns") are slight, if not entirely inconsequential.

 There is still a target for the DJIA which leads to 13111.38

 The Bollinger Bands, which lead slightly higher, confirm there is more upside in the markets and we shouldn't be surprised if the Dow gets there. 

 The retail bears can be thankful that the S&P 500 hasn't caught the same wave the Q's have, or all hell could break loose. 

 None of this seems to deter the retailers, however, in their neverending quest for that ever-elusive, "top." How's your inbox these days? Are you still getting flooded with emails suggesting (demanding!) that the top is in?

Nickled and dimed to death?

 Perhaps that should be your first warning.

 Small money bears have been so seldom right in the last three years it might be time to stop listening to them and leave their bleak images of incarceration camps, food riots and violence behind.

 It's just a suggestion.



Always perform your own due diligence. These are only my opinions.

Charts Heading into a New Week

 Some charts on a winter's day. Let's see if we can sort some things out.

Market leaves both bulls and bears wondering

 The Dow Jones Transportation Index stalled at a trendline last week, which has thus far produced only a minor pullback.

 Left click on chart(s) to expand

 There is a bearish wedge here, conflicting with a bullish crossover on the moving averages.

 The Dow Jones "appears" to be over-extended, but the upward trend is still intact.

 There is also a bearish wedge on the Dow Jones. 

 The SPX stalled on a trend line dating back to its all-time high.

 The Q's also caught a trend line.

 The trendline coincided with a long-term pattern (which was slightly surpassed), although the Q's finished the week closing on its exact target.

 Gold is at the top of a Bollinger band on the daily.

 The GDX is closing in on a technical top here. It's slight, but it's there.

 If someone had told you on October 1st to sell your gold and put your money into the Dow's US Homebuilders Index, what would you have said?

 The markets seem somewhat over-extended. This is not a recommendation to go short.

Always perform your own due diligence. These are only my opinions.

Traders Play Coy Overnight

 It's probably best not to mistake this sideways tedium and ensuing pullback in the ES and NQ as disinterest in Apple's earnings yesterday. We shouldn't doubt for one minute Wall Street is ecstatic over the news and had the overnight traders chased the market higher, there'd be nothing left to get the public on board.  

 Anyone considering getting short in the morning should sit tight and see how things transpire.

 Even though the NQ and the Q's are closing in on a major pattern top, there are no laws that say the target cannot be surpassed.



Always perform your own due diligence. These are only my opinions.

Apple's Earnings Send the Nasdaq Higher

 Apple's earning are out and they have surpassed all expectations. Although trading in its shares were temporarily halted, its resumption proppelled Apple, the Nasdaq futures and the QQQ ETF to new highs.

 Short sellers are faced with an unenviable decision here, and it's not a choice that will come about easily: "How much higher can the markets go?" Bulls might want to ask themselves the same question.

The last thing short sellers needed to see

 This is why it is so difficult to time tops or bottoms (even temporary ones). The market often has a mind of its own, and all the technical and fundamental analysis in the world isn't going to change it, at least not for now. The market seems quite willing to do the exact opposite of what so many people expect and has no issues punishing those who confront it.

 If there is a saving grace for bears here, it is that the S&P 500 met Apple's news with a stifled yawn. A minor upward thrust, yes, but it wasn't even enough to re-capture the highs set the previous day. When the euphoria from one index doesn't carry over to another, it should at the very least send a signal that not everything is perfect. There should have been some semblance of confirmation and perhaps we'll see that as the overnight traders on the futures market digest the news ... perhaps we won't.

  

 Do we sell the news?






Always perform your own due diligence. These are only my opinions.

Time to Take a Break, Bulls

 Not much happened this week ...

 The Q's hit an eleven year high, US and Canadian banks are on fire, and the Dow broke upward outside of a threatening bearish wedge.

  

Bears have had little to be happy about lately

 Banks

Canada

US Regional

US Bank Index - Philadelphia

Blown away




 

The Q's

 The Q's ETF (top 100 Nasdaq stocks excluding financials) have been on an incredible run. Even Google's (GOOG) miss this week on earnings barely deterred the underlying strength of the tech sector. 

 That's the good news.

 Now, it may be time for the bears to come out and play.

 Many vehicles are threatening, at the very least, temporary tops and while it's never recommended to stand in front of a roaring train, this is probably as good a place as any. We could very well be close to the proverbial, "screeching halt."

 The Q's, the Russell 2000 and the Indoos are all closing in on "D" targets.



 Of course, this blog has been counter-attacking the "technical" bears at every opportunity over the past few months. Now, it's probably a good time to sit back and wait to see what the markets have in store for us.

Time to pull in the reins?

   

 

 The markets need to catch their breath, though it would not be a huge surprise if they continue their march upward.

Always perform your own due diligence. These are only my opinions.



Bears are Waiting at the Station

 Gaps up in daily price bars or candles don't always have the kind of follow-through necessary (ie more buyers) to continue the upward momentum the overnight traders generated. Positive momentum following a gap is often dependent on how far away the next line of resistance is or how large the window might be.

 Left click on chart(s) to expand

 This morning's gap managed to drive the Dow Jones Industrials well through a trendline, but the selling pressure was too much to overcome, and by day's end, the Dow finished the day parked right on the trendline, which has served as a price magnet for the past several days.

 It takes millions of shares (and hundreds of millions of dollars) to push a trading vehicle like the SPY up ten or twenty cents. While this may seem inundating (monetarily), it is not such a difficult task when there are plenty of short-sellers to squeeze on the way up.

Bears are wondering when their train will arrive

 It would seem, however, bears have lost much of their, "short everything," bravado and have finally chosen to wait at the station for the train to reach them, rather than suffering through their previously impatient and futile attempts to board a steaming locomotive on the way there.

 The world will eventually come to an end, my dear bear friends.

 It leaves me to wonder why so many of you have been in such a rush to get there.

 

Always perform your own due diligence. These are only my opinions.

Always perform your own due diligence. These are only my opinions.

Ambitious

Always perform your own due diligence. These are only my opinions.

Bearish Technicals? What Bearish "Technicals?"

 Manipulation on the markets? Sure there is, and this is nothing new going back eighty or ninety years. Charles Dow may have been the pioneer behind Dow theory, but later on, S.A. Nelson and William Hamilton refined it:

* The first assumption is: The manipulation of the primary trend is not possible. When large amounts of money are at stake, the temptation to manipulate is bound to be present. Hamilton did not argue against the possibility that speculators, specialists or anyone else involved in the markets could manipulate the prices. He qualified his assumption by asserting that it was not possible to manipulate the primary trend. Intraday, day-to-day and possibly even secondary movements could be prone to manipulation. These short movements, from a few hours to a few weeks, could be subject to manipulation by large institutions, speculators, breaking news or rumors. Today, Hamilton would likely add message boards and day-traders to this list.

* from www.stockcharts.com

 "Manipulation of the primary trend is not possible." 

 What is the primary trend?

 That would depend if you are bull or bear.



Bulls are Continually Under Attack on the Internet

 What is the primary trend of the US dollar? Gold? The stock market?

 Deciding which is doing what is a matter of interpretation.

 Technical bulls will view the primary trend of the stock market as, "up." This bias will be reflected in their charts.

 Technical bears will view the primary trend as, "down." Unlike bulls, however (who pretty much seem to stick to charts), most bears seem to back their "technicals" with an arsenal of bad news. The bear's bias, technically speaking, has been corrupted by whatever, "the world is coming to an end" internet site they choose to read, in which case they'd probably be better off leaving charts out of the equation altogether. Aside from the occasional downstroke, their charts have been wrong for almost three years running, after all, though they do deserve some credit for their "technical" perseverance.

 Grab a chair, bears, you're probably going to need it.

Always perform your own due diligence. These are only my opinions.