Kind Words from Terry Laundry, Founder of T Theory

"Parker has sent me what I consider to be the most important refinements to T Theory I have ever received from anyone in an e-mail . . . which he calls Tweaking the 13th Advance Decline T." September 29, 2010

"Parker has sent me a very interesting concept which is the NY Advance Decline line divided by the put-call ratio . . . What he's done is introduce the idea of sentiment." September 15, 2010

"Parker discovered the Money Flow Ts . . . This is something like the Holy Grail in T Theory. You are always looking for something that will help you refine the peak date." October 17, 201

"Money Flow Ts are probably the greatest new thing I have seen in 20 years in terms of time symmetries." December 5, 2010.

Friday, December 17, 2010

$$ SOX and BKX Acting Much Stronger than the S&P this Morning

There may be some pinning of the S&P today on OPEX that might prevent it from closing where it would ordinarily close.  Certainly SOX and BKX are suggesting that equities should be rising, not falling:

Posted by at

30 comments:

  1. UnknownDecember 17, 2010 at 9:18 AM

    agreed - Parker I am thinking about longs today (sso, iwm and the like) but what is hanging me up is the strong USD! My charts show it still in an uptrend, albeit a ragged one.

    I know you said USD would bottom in Feb about the time you think the market will rollover but it looks pretty strong here (eventhough it hasn't quite been able to break back into the up channel I have on my charts).

    Raj was all over this yesterday but it looks like USD simply wont die...

    any thought would be appreciated!

    ReplyDelete
  2. PositionSizingDecember 17, 2010 at 9:23 AM

    I'm guessing the dollar is reacting to the Moody's final downgrade of Ireland's bonds.

    I had a US Dollar Money Flow T strength into 12/17-12/20 before heading back down to a major low in early February.

    If you want to get into silver or gold, I might start nibbling today and complete my position by Monday.

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  3. UnknownDecember 17, 2010 at 9:30 AM

    ok - sound advice I'll raise cash this morning.

    SLV!

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  4. BillHDecember 17, 2010 at 9:35 AM

    Parker

    Here is a chart I have not seen on your site.. the 5 day New Highs minus New Lows.. another major divergence, showing fewer and fewer stocks are moving with the indexes.

    http://stockcharts.com/h-sc/ui?s=$USHL5&p=D&yr=1&mn=0&dy=0&id=p77139900230&a=213019883

    I guess this is pretty much what we should expect when a Hindenburg Omen can occur.

    Best to your trading.

    Bill

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  5. PositionSizingDecember 17, 2010 at 9:44 AM

    Thanks Bill.

    I notice there was no bearish divergence at the April peak or the Nov 5 peak. But there was some bearish divergence in March and late October.

    ReplyDelete
  6. UnknownDecember 17, 2010 at 9:48 AM

    Man Parker - USD is well back in its up channel now...80.60!

    argh - I swear there is a voice in my head saying USD will go to the top of the weekly wedge before it breaks down...that would take it to 87.50ish
    http://stockcharts.com/h-sc/ui?s=$USD&p=W&yr=10&mn=11&dy=30&id=p68568071019&a=209168495

    ReplyDelete
  7. BillHDecember 17, 2010 at 9:54 AM

    Scott

    My Momentum Change indicators generated a Buy signal in the Dollar 12/15, at 80/35/

    as you know, this is a very volatile market.. and I have seen some whipsaws this year.

    Stop loss placement is key to a successful trade.

    Bill

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  8. UnknownDecember 17, 2010 at 9:57 AM

    BKX is fading again! FXE is getting hammered.
    Right at 200MA

    maybe it finds support at 200 or just below at 130ish and the gap? looking weak...damn it all it is so hard to switch gears when the charts look like they do!

    http://stockcharts.com/h-sc/ui?s=FXE&p=D&yr=0&mn=4&dy=2&id=p62950866292&a=205491389

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  9. UnknownDecember 17, 2010 at 10:09 AM

    Bill - volitile? really? is that why I'm sea sick all the time?!

    USD is the wild card I think - it just wont break and the Euro is dying but may have one more bounce off this area at 130ish after it fills the gap -

    I think I will use this USD strength to move into SLV and GLD and IAU - thinking about IWM and SSO as well GOD HELP ME!

    ReplyDelete
  10. marketliveDecember 17, 2010 at 10:35 AM

    We are strong as I mentioned repeatedly for 2-3 weeks now. Let's see where we go. Lot of bad news in Europe, but market is cheap in the U.S.

    ReplyDelete
  11. Tim MackDecember 17, 2010 at 11:33 AM

    What are the players who can move the market doing?

    Are they getting long here initiating new positions? Are they getting short liquidating longs or initiating new positions? Or are they on the sidelines waiting for option expiration, a news event that would force them to “react”….or trade or something else?

    ReplyDelete
  12. marketliveDecember 17, 2010 at 11:37 AM

    Bears are on a drip and have been tazed. You won't get a real answer here and do you think that your question can be answered?

    ReplyDelete
  13. joedDecember 17, 2010 at 11:52 AM

    No real surprise in these markets, Dow continues drifting up into 12/29 posted date along with confluence of dates! Bonds came off bottom as stated with the closing of all shorts in TLT……….nice swing trading in this market off the bottom! TLT resistance 9310!

    ReplyDelete
  14. JosephDecember 17, 2010 at 11:58 AM

    Tim,

    I believe the big players are primarily in distribution mode. As of noon, Friday, ET., the market is positive for the week, but there has been a large negative money flow according to the Wall Street Journal.

    I think most people think distribution is when prices fall. I think it is when prices rise, or are flat or go down a little but there is at the same time significant negative money flow. Distribution is when the big players goose prices up or hold them roughly level so they can unload their long positions at the best possible prices. As of noon Friday the weekly money flow was negative by $6 billion dollars, but prices were nearly 1% higher than where the week started. I count this as distribution.

    Of course, I don't know how long distribution can go on before prices must begin to descend. Also, the week is not over, and I suppose a huge move in the market this afternoon could change things. But right now, this looks like a distribution week.

    joe

    ReplyDelete
  15. Tim MackDecember 17, 2010 at 12:04 PM

    Marketlive- the questions are rhetorical. I simply hoped that they were thought provoking to the readers of this blog who seem to be well above average intelligence.

    Ask these questions to yourself. The answers are readily available to all who seek it. Who is in control of price and how good of a job are they doing? If you figure it out then ride their coattails. If you don’t know, your trading capital is at serious risk.

    ReplyDelete
  16. marketliveDecember 17, 2010 at 12:10 PM

    There is no Wizard of Oz, no conspiracy and no single player. There are tens of thousands acting on price. Obviously far more buyers than there are sellers since August. That is what I know. However, was speaking to a friend at a large MM today and they have been selling some tech longs into the rally fwiw. Hope that helps.

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  17. joedDecember 17, 2010 at 12:10 PM

    SSO chasing the 4750 area............

    ReplyDelete
  18. marketliveDecember 17, 2010 at 12:12 PM

    Another thing, there must be a TON of shorts out there or we wouldn't be this strong and steady for so long.

    ReplyDelete
  19. joedDecember 17, 2010 at 12:20 PM

    NO Wizard? What bout Santa?

    ReplyDelete
  20. ForwardDecember 17, 2010 at 12:59 PM

    MarketLive,

    I think there is a single player that has changed the rules here at the casino. The Fed is the house and have removed the natural ebb and flow of funds through the markets, IMO. It seems whenever they want to increase wealth to get growth, all they have to do is buy 1/2 to 1 $trillion in securities and the equities market will go up about 25%. This is what's happened since August, it seems to me. The alternative is bread lines and civil unrest. The Fed thinks the can reverse later when growth has been achieved. They're probably right. This market has gone up on the backs of shorts that made educated guesses based on the same economics, behavioral science, stats, and probabilities that worked for shorts and long profit takers in the past. It seems that as long as the Fed's minding the store, the public's wealth has a watchdog. This was not the case before 2007. Today's heavy-handed intervention is in reaction to the negligence the enabled the twin bubbles of housing and dot.com to happen. The long-only, sleeping, 401k, indexing clueless have been vindicated and are in danger of becoming haughty.

    ReplyDelete
  21. normDecember 17, 2010 at 1:11 PM

    Forward,

    I'll second your thoughts with an exclamation point. Zerohedge posted this chart a couple weeks back and if the data is to be believed, the Fed has made a HUGE impact on the market.

    http://market-innovations.com/gfx/insights/2010/chart1205_2.gif

    Marketlive,

    You sound like an ideologue who is trapped in the silly notion that there is a "free market" out there. The Fed has been moving the market at will but one day the unintended consequences of their actions will catch up with them and this market will be toast.

    Norm

    ReplyDelete
  22. DanielBDecember 17, 2010 at 1:16 PM

    Scott, remember that cash is also a trade. I'm watching the dollar closely, too, but it's been in a little range for the last couple of weeks which only really appeared on Monday of this week. It's okay to just wait for a directional development. It was hard for me to learn that I didn't need to be in the market all the time. Personally, if it (uup) can break 23.20 on a closing basis, I think the trend will likely continue upwards which may usher in something of a correction (not big, I don't expect big moves until 2011 at this point), but it's just as possible that we breakdown 20.80 as support and continue the downtrend. Either scenario should give some direction to gold & silver as well.

    ReplyDelete
  23. JustSignalsDecember 17, 2010 at 2:12 PM

    FYI...SPX...GLD...USD...astro charts to year end...
    Parker, from 12/20 to 12/31 the USD forecasts a pullback and the SPX & GLD forecasts a rally......http://bit.ly/fK1AiW

    ReplyDelete
  24. marketliveDecember 17, 2010 at 2:42 PM

    In regards to the markets the Fed is certainly a player as are most central banks worldwide. Check out Japan, UK, etc. Just get used to it because it won't change.

    ReplyDelete
  25. UnknownDecember 17, 2010 at 2:54 PM

    I flipped long with 30% position in IAU and SLV...sold the USD this morning into strength. I think the Euro meetings will boost it - FXE bounced right off the 200ma today.

    may review bonds over weekend - tlt launched as if it had a purpose (and a bottom in)! LOL

    ReplyDelete
  26. BillHDecember 17, 2010 at 4:05 PM

    Scott

    My Momentum Change indicator generated a Sell signal on 10/8 at 103.50.

    as of the close today, TLT is close to reversing that momentum.. but yet quite yet.

    I will be watching the Monday action... if the long bond is strong, it will probably flip to a buy signal.

    Bill

    ReplyDelete
  27. ForwardDecember 17, 2010 at 6:30 PM

    Norm,

    Thanks for the dittoes. I think that the risk of unintended consequences is not as important to the Fed. Just pull back a 1/2 $trillion and watch the froth blow off equities like a pile of dry leaves. Genius idea creating the Fed, the ultimate Big Brother. Does this mean I can just go long, 40 times leverage like before, go back to sleep for 20 years and not worry until the the first whiff of inflation--like the old days? I liked your chart. What is the unit of measurement on the bottom scale of the POMO, $?

    ReplyDelete
  28. The TruthDecember 17, 2010 at 8:10 PM

    Do not short until Jan. All institutions will prop up the market to make it look good for end of the year result. I expect the market to hit SP1260-80 range by year end

    ReplyDelete
  29. waw4December 17, 2010 at 8:58 PM

    TLT nearly completing a round trip back to where it ended 2009...

    ReplyDelete
  30. normDecember 17, 2010 at 10:16 PM

    Forward,

    I don't know. Just put the chart up that I found on Zerohedge and they did not give a data source. Since that time Mole of EvilSpeculator has unearthed the data and has been updating the chart but I never saw a post where he explained WTF the data came from.

    http://evilspeculator.com/?p=18604

    Norm

    ReplyDelete

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