Thread: FogSailing's Account Talk

An informative chart from Kimble Charting:

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FS

This is an interesting look at the Yen and Dollar compared to these currencies behavior in the mid 1980's and again last year. If the Yen rises the Dollar falls (resulting in less liquidity in the market and generally not good for SPX). Vice versa when the Yen falls. Just another factor to be considered and just FYI.

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Best to you in the market.

FS

Here are quotes from 2 of the TA's I follow:

The Bull: We’re in “Bizarro World” again. Bad news is shrugged off or reinterpreted as “good news”, as you say, market goes higher. Good news is expected and goes higher. This has worked in the past and could continue for some time.
The Bear: Near term outlook offers a post-FOMC break to the 2065/61 gap zone. There is a viable April close in the 2050/40s.. with VIX in the 17-19 zone.

Two smart guys with lots of market experience and diametrically opposed views this week. The rest of the week will be quite interesting.

My current thinking on the state of the markets"

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FS

Thought this tweet from Tom McClellan was very interesting:

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FS

Glad to see the BOJ do the right thing and not drop rates farther into NIRP. Perhaps, just perhaps, they are coming to their senses and realizing NIRP is a disaster. Next step is for the BOJ and ECB to raise rates back to 0% and get off this crazy NIRP experiment. But that is quite a gap that occurred last night with the USD\JPY at 109 from 111. That should be good for the US markets today...Still think we're headed to 2034 pivot before we see another bounce though...

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FS

This was posted by a TA I follow and thought it was worth sharing:

"I am declaring here and now, after this big drop that we will hit new highs in this current leg up. I get these poker “TELLS” every so often and the latest GDP report confirmed it for me. the so called manipulation of energy and the like is in anticipation of accelerated growth both here and in China. Got separate report about China confirming my suspicions. Consumer is sitting in the best position going back decades. Business spending slowed significantly in the same time period as the consumer reduced debt and increased savings. The odds on favorite is for a surprise domestic acceleration on all fronts and soon.

The “wild” card is China. If they can’t accelerate their growth then we move in slow motion one way or the other. If they can then all ships ride the tide.

I will be looking to play the long side with short term SPX Calls soon. Depends on tomorrow or at the latest Monday’s action. Hope to see a drop of another 20 SPX points.
Believe once the dust settles over next 2 months we will be on the last but most powerful leg up."

FS Comment: I hope she is right. It could mean that "Sell in May and Go Away" doesn't work this year...We'll have to see how things go once SPX pulls back down to between 2034 and 1960. As an aside, the China CB appears to be doing it's own form of QE so maybe money will flow into their economy and boost economic activity as they transition to with a larger service oriented economy. One final thought. If this bull TA is right, this could be the biggest damage done to bears in a long time. There is a whole bear world out there waiting to short the market to recoup all their losses over the last 2 months. The resurgence of a strong bull market would eat them alive since I think most are expecting May and June to be BIG BIG declines in SPX. I wish I knew the way things would turn but I don't. I'll just try to follow the trend this time and hopefully catch the right wave.

FS

Interesting Blog on Oil: Black Gold Disease: Fundamental Friday: 29 April 2016

FS

Originally Posted by FogSailing

Interesting Blog on Oil: Black Gold Disease: Fundamental Friday: 29 April 2016

FS

How's that peak oil theory working out for the Liberal predictors? About the same as Global Warming I'd say.

I agree that peak oil is laughable Norm. The oil market stills seems to be moving sideways but to the upside. That makes little sense if supplies are really outpacing demand; not to mention that oil storage is expensive. But, oil still appears to be headed to $50 a barrel on Friday (even with the down day) so obviously I'm not understanding something. Next week will be quite a tell I'm thinking. We're due a pullback but will it turnout to be is a head fake for the bulls or the bears? I was thinking the head fake was for the bears on Thursday and Friday but there is so much negative stuff still mulling around(especially the debt stuff) that I'm rethinking all that. Of course, if the CBs interfere, it doesn't matter what any of us think.

FS

If the Fed is pumping dollars into the system, then the dollar drops against other currencies. And the value of items now take more dollars. Cheap dollars means more exports, and more money CONUS rather than OCONUS.

The price of oil is not linked so much, IMO, to the VALUE of the barrel but the number of dollars available to price the barrel.

And nothing really to bounce that against in a video or some other reference. Just an observation from the fox hole.

DT: For me the jury is out regarding the linkage between oil and SPX. I think US Markets have used both commodities and currency manipulation to move the markets over the past 6 or so months. The CB intervention has been obnoxious but I have to tell myself that they have a civilization to herd and need to be in the forefront at this time. I am starting to ponder possibilities about how NIRP could be useful if it worked to distribute wealth from the 1% to the masses in some fathomable way, with ZIRP for the 99% (so to speak. However, no idea how such a policy might work in a way that truly benefits the "many over the one" as Spock would say. But since the idea is basically contrary to my thinking I'm pretty sure it's a nothing burger. Still, the concept of achieving an economic balance is a macro issue and will require macro solution (whatever they might be).

FS