About a month ago, the internet was “abuzz” with dire warnings of Hindenburg Omens, calling for imminent collapse. If you recall, I called for a “Nagasaki NOW!” move up, just to sort of counter-balance all of the tomfoolery that was being broadcasted on CNBC. Fast forward 10 trading days and 600 Dow points, everyone is calling for a super-spike past 11,000. Need I remind you to exercise restraint, following parabolic moves? After all of these years showing you animals how it’s done, you still forget the basic principles of investing.
Sure, if you stuck with this move, all the way, you made more money than me. It’s true, I am not big on pushing the envelope these days, which has more to do with having gains than not, if you know what I mean.
Instead of regurgitating all of the bad news, like Ireland getting a secret ECB bailout last week, I am here to remind you of your place, which is decidedly lower than me. As the summer winds down and degenerate clowns laugh it up on the teevee, discussing the “cock market” and how it “deserves to be so much higher,” keep in mind they are fucking morons of the first order and are wrong all the time.
“People never see it coming. They just get to see it go.”
-BEAS, 2010
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I’m thinking a little EDZ is in order.
Also, FIRST, FIG, etc…
Daniel Tosh’s view on FIRST
http://www.comedycentral.com/tosh.0/2010/09/15/first/
Welcome to iBC sunday school. Preach that truth, Deacon Fly
Fly, I forget… How long do we go beyond the omen date till we call it a false signal?
From wikipedia:
The traditional definition requires each condition to occur on the same day. Once the signal has occurred, it is valid for 30 days, and any additional signals given during the 30-day period should be ignored. During the 30 days, the signal is activated whenever the McClellan Oscillator is negative, but deactivated whenever it is positive.
Therefore the mclellan oscillator has already invalidated the *signal* .
Bullish
There is no such thing as omen, just like unchecked bull markets during deep recessions
Careful with the negativity – you may become overwhelmed with the tin foil hat/chicken little cult over at zero hedge…. where every thread is guaranteed to degrade into 400 comments about how the end of modern society is imminent.
Nice post Dr. Fly. I’m fully hedged awaiting the next PPT buy signal.
I have no doubt we will ultimately go lower before the real parabolic run begins… currently scheduled for late Oct. This was just the warm up.
For this week we still need to have an upside breakout before we go lower.
I fear THE FLY knows a lot more than he post here, about the whats happening soon
Fly,
I will never make more money than you,
but I aspire to someday.
To that end, I am not chasing here,
and I have not forgotten the basic principles of investing.
If we are green EOD day Monday,
I might buy some TZA as a quick trade
leading into Tuesday’s FOMC meeting.
It worked last week for quick scalp.
I enjoy the insights here. What I don’t understand is the perception of a recent “parabolic” move up. When looking at a longer term chart of SnP I just see it trading in a range and a test of the upper bounds of that range now. Now if one got short at bottom of then range, the perception of “spike” up would certainly be understandable. I am short here, only because we are at the top of range and it seems like a reasonable place to load short. If it does crack this upper range boundry, I will exit and wait for a “possible” formation of a right shoulder, which could happen at a higher level still. -good tradingnto you all
jenovas witness
\ http://www.youtube.com/watch?v=VSAnkWrqWuM
dont think
just click the link
listen to this one too
http://www.youtube.com/watch?v=Hk-AQ4O5KiI
Filthy.
The only reason this market will pull back is because of profit taking. The economy is solf yes, backsliding no.
Our economy will continue to move forward slowly, only for one reason. People demand prosperity, and will work to get it.
This is probably one of the stupidest statements I’ve seen on internets for a while:
“Our economy will continue to move forward slowly, only for one reason. People demand prosperity, and will work to get it.”
Don’t tell me…you’re republican, aren’t you?
I am sure the brilliant Le Fly statement (“I am here to remind you of your place, which is decidedly lower than me”) was meant for this caliber…….
He has antlers, not horns.
haha, stupid non biologist people
I used to mock Fly, can’t remember why to be honest. He did ban me once, I recall I may have asked for it.
Over the past 9 months, I have moved from mockery to some…admiration, quite a lot actually.
I think he suspects at least a pullback. I suspect a lot more.
In 6 weeks time I expect the markets to be 20-30% lower than where they are now.
I may the seek to engage Fly’s professional services.
Thanks are due to him.
There are many who mock The Fly, however, they ultimately blow their accounts up and disappear.
Time to load up on shots then…………
I used to mock him and I got squashed like a bug.
30%? into november?
I presume this is because you think obama can somehow steal the november election by executive order. Because short of that, there is no way in HELL we go barreling down 30% into a huge republican victory.
Want to bet a dollar on that? between 20-30% I reckon.
Induced by the Fed, to enable it to launch QE2 BEFORE the mid-terms.
Fed is up against a wall soon politically.
QE2 is only to benefit Fed’s shaerholder’s, the nearly bankrupt big banks.
A sad state of affairs, to fuck over a whole country to save nasty banks.
But it’ll happen,
Ireland is being hung out to dry too, this year’s Lehman.
See my lastest post in Peanut gallery.
Well don’t forget all the market players that will have to buy into years end to make their performance more closely mimic all the other dumb money. I hate to say it but this market might just have serious support into years end. How I long for a time when things made sense.
I don’t think things are as rosey as they say.
Going to wait for the fake-out “break out” to go short. Then Ioad the boat. Till then…watch the games unfold.
Like he said: maximum pain delivered if Mother catches many premature longs leaning the wrong way.
That seems like a good game plan. This is a well established range. It almost seems certain that it will head fake over the top. There is a lot of stops sitting above the range waiting to be harvested. Fake breakouts are one of the best entries.
WTF! Goin down?
http://www.youtube.com/watch?v=UdntH7Ya5xQ&feature=youtube_gdata_player
Mood vs. SnP? WTFO. How are they calculating “mood” – with one of those changing-color mood rings? This is about as bad as using Astrology for market cycles. It’s a Science Free Zone.
Pathetic.
Doesn’t this youtube genius know that consumer confidence, and presidential approval ratings, have been an INVERSE indicator for 30 years?. The lower they go, the less likely a major crash will happen.
Must be Prechter’s nonprofit think tank. Sounds similar to and socioeconomic Elliot Wave theory. ie – the Grand Super Cycle is coming!
I guess the reason for my statement is because I am in a business where many have not survived this downturn. It motivates me to know that that there is opportunity out there regardless of the economy. I want what is best for my family, and i am willing to work to get it. Not blame my lack of success on someone else. It was just a thought i had not meant to a
offend anyone.
Look, I am sorry for the strong statement above, I really am! I didn’t intend to offend anyone either but I did want to point out the fallacy in the line of reasoning. Your statement seems to indicate (to me at least) that we are going to prosper because we are wired by nature to do so’…and, over a VERY long term, I would agree. What this statement misses/offers false hopes, is the fact that the whole fucking world is so fucking far in debt (not to mention other serious issues we are facing) that there is NO FUCKING CHANCE that this will get repaired anytime soon or without severe social, not to mention FINANCIAL changes across the board…globally! As much as I want to admire the ‘faith in the human spirit’ attitude…It ain’t gonna fucking happen! We are due for, and we will get, serious ‘cleansing’ for at least a decade, before we can even hope that things are getting back to where they were a few years ago.
And in response to your “It motivates me to know that that there is opportunity out there regardless of the economy” statement…I couldn’t agree more. Good luck to you and hope you find the opportune business to get into.
Cheers
See – I told you.
This is exactly what i predicted would happen (as posted above).
Fly’s negative headlines inspire the fucking looneys from Zero Hedge to come over and start preaching their “end-of-the world starts tomorrow” and “markets gonna crash” shit. Yes Joe, the world will end – I just doubt that it starts this week.
They are like a fucking plague of locusts.
Joe,
This is the giant elephant in the room that very few want to talk about. The amount of debt is so fucking giagantic that 99% of all people can’t even comprehend it. There is between 5-6 trillion of US consumer debt that has to be unwound. To put 1 trillion in perspective: 1 million seconds is 12 days, 1 trillion seconds is 32,000 years. Rut Roh, Shaggy!
Hey joe, I just deleted my message for you since the fly would ban me for posting it, so ill just go with fuck off.
There is a huge separation of wealth in America that is becoming more obvious now that the banks are kicking the poor out of the lobby.
I think we are in a recovery and it shows on companies’ balance sheets and not in the poor peoples’ lack job, house or whatever. The market might sell off 10%, but will not tank.
It’s all part and parcel of being the Blogfather. Sorry, someone has to do it
The end is near, don’t go to sleep tonight, it might start very, very soon!
If the world ends, your trading account is worthless anyway—-whether you are currently long or short. Keep things in perspective, boys..
It’s like people who wish for armageddon so gold could go to $30,000
A comparison of bond rates to commodity cycles to project deflation or inflation from Tony @ OEW:
> In the 1920’s when credit was flowing rates were declining. Then heading into the depression rates spiked momentarily after FDR increased the money supply dramatically when calling all the gold and raising the price from $20.67 to $35.00. Then during the main part of the depression rates continued to decline until the late 1940’s. After that they started edging up into the 1950’s until taking off in the 1970‘s and topping around 1980 or so.
Again credit started flowing as rates gradually declined, and they continue to decline. During the last deflationary cycle rates declined throughout the 1930’s to 1940’s. During this deflationary cycle rates are also declining as deflationary pressures persist. But here is the pattern.
Notice rates were declining heading into the depression. When FDR increased the money supply the commodity bull market began in 1933. That bull market continued until 1946, putting some inflationary pressure on the economy, and rates continued to decline. Rates did not start ticking up until after the commodity bull market was over in 1946.
The next cycle is quite different. Rates were rising from the late 40’s/early 50’s into the next commodity bull market, which kicked off in 1967. Look at the results of that bull market without deflationary pressures to offset it. Rates peaked right after the commodity bull market ended in 1980. Two commodity bull markets, two different results.
Now we jump ahead to the present. Rates have been declining since around 1980. Then continued to decline into the 1990’s. This is similar to the decline in the 1920’s. Deflationary pressures began around the turn of the century with the dotcom bust. The bull market in commodities kicks off in 2001. As commodities continued to rise, rates (except for a momentary spike) continued to fall. This is similar to the 1930’s. Again the commodity bull market is offsetting the deflationary pressures in the economy.
When we look at 1929-1933 we see a total deflationary collapse. The stock market lost 90% of it value and unemployment soared to 25%. Commodities at that time were in a bear market too. It wasn’t until FDR called all the gold and dramatically increased the money supply in 1933, which kicked off the commodity bull market, that things started to stabilize. Rather than going through a similar deflationary episode this time around Greenspan left rates low for a long time and kept liquidity flowing. This averted the first wave of the collapse, but it created new bubbles in real estate and the financial instruments. When those bubbles burst in the second wave of deflation, Bernanke started the printing press and dramatically increased the money supply. What followed was a myriad of alphabet soup programs, $875 bln from the gov’t, etc., etc. etc. The FED/Gov’t flooded the system with money. For the past two years the FED has been buying Gov’t agency bonds to keep mortgage rates low, and Gov’t bonds to support the expanding debt. Recently they announced they are buying further out the yield curve, which is exactly what the FED did in the 1940’s to keep rates low. What was old, is now new again.
Conclusion: Long term rates, including AAA corporate’s, should continue to decline or hold steady until the commodity bull market ends in 2014.
Around that time deflationary pressures will probably have lost its effect on the economy.
Rates will start moving higher after the FED is comfortable that this has occurred. This is likely to occur during the next stock bull market cycle after 2014.
Rates will then start to normalize again in the area of 5% until the next commodity bull market kicks in. Then hyperinflation.
When a commodity bull market occurs during a deflationary period the net effect is low inflation.
When a commodity bull market occurs during normal times the net effect in high inflation.
Interesting world. When Gold tops in 2014 most will think inflation is dead and rates can now stay low for a long time. Then over the next several years the exact opposite will occur. <
See chart here: http://caldaroew.spaces.live.com/?_c11_BlogPart_BlogPart=blogview&_c=BlogPart&partqs=amonth%3d9%26ayear%3d2010
His weekend update is at that link also – including Long Term and Mid Term reports. I’ll post the Short Term report here for traders interested:
> SHORT TERM
Support for the SPX remains at 1107 and then 1090, with resistance at 1136 and then 1146. Short term momentum has not entered an oversold condition since the end of August, and is displaying a large negative divergence. As noted above, we can now count five Minute waves from the SPX 1041 low. This suggests the potential for a more significant pullback, than the recent 14 and 12 points, is gaining in probability. Several technical factors are also leaning in this direction. First, the large negative divergence already noted; second, the overbought condition on the daily charts; and third, the OEW 1136 pivot which has provided resistance since June. Should the SPX drop much below 1120 next week this would suggerst the pullback is underway. On the positive side, should this rally break through the 1136 pivot range it could extend this wave. On the downside, should a pullback break through the 1107 pivot it should find support at the 1090 pivot. If that fails, we will likely need to retest the OEW 1041 pivot or lower. <
Tea…..did you notice on Friday the NYSE had a positive increase in the number of stocks advancing….but the Advance – Decline Volume was negative….
an Omen???
TeaMan, Please to define for me “normal times”! Over my multiple decades making and losing money in this financial business I have yet to hear anyone stoutly declare, Hey everyone, normal times are here again. I think it may be a generic term for, I have no idea WTF the answer is.
I believe the author is referring to a period of Normal/Stable Interest Rates
Thanks Jeremey for the update on the votes cast thus far for 2010 V.King Award….
1. Ray Lewis. LB Baltimore Ravens 68 votes
2. Sylvester Stallone. Expendables 10 votes
3. The Fly. iBankCoin/PPT 209 votes
4. Vladimir Putin. Kremlin Russia 105 votes
5. Gen. David Petraeus. Iraq/Afghanistan 10 votes
Also worth mentioning Steve the Neighbor has received 13 write in votes
I am humbled and will continue to pump iron and drink Manischewitz wheat grass until I get strong enough to take down my neighbor Fly in a Greco-Roman wrestling match. By the way, Fly, Mrs. Steve said you look very nice and a little like Art Shamsky without your facial hair. We enjoyed our Saturday night visit and do apologize for the crank calls Steve, Jr. made during our visit. We will get a new babysitter. Perhaps, V.King or Jake will be available next time.
Mr. Neighbor
Why don’t the 3 of us meet at the gym tonight for some friendly leg pressing…Bring the kids if you can’t find a sitter, we can have them rack for us.
The best thing the Pres. could do for the economy is to ask everyone to work a little harder at whatever job they have. A little exhortation, cheerleading, whatever you want to call it.
Good afternoon ladies and gents… I would like to introduce to a small piece of my wisdom: IT’S A BULL MARKET, YOU KNOW.
If you not familiar with who I am, you should not be trading.