Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Energy Looks Prone to Weakness

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I was going to do a post titled "Maybe Atilla is Right". As I'm looking at all my index charts, I'm impressed by just how much resistance there is in this market, and how poised equities seem for a renewed turn downward. I'm not ready to join that camp, but if the market does really plunge, we've got to throw the guy a parade or something, because everyone else (including permabears EWT) have thrown in the towel.

Energies have been good for me on the long side over the past week, but I think they're about to turn weak. I shorted a bunch of XLE this morning. OIH, shown below, also looks it has a very serious resistance level at 88.15

Deep Dive on the S&P 500

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Today was FAZtastic.It didn't undo the damage from yesterday; that was a shotgun blast to the chest. But I did claw my way one-third back from yesterday's devastation, and it's a good (albeit exhausting) feeling. FAZ played a role, and I'm glad I decided to give the old bugger another chance. I really did feel financials were full of hot air, and some of that air was allowed to escape today. Below is the FAZ, as well as its ever-increasing volume.

I wanted to focus on the S&P 500, since its direction basically determines all of our fates. Let's face it, no matter how bullish or bearish an individual chart is, its fate is going to be largely at the mercy of the broad market. So understanding the likely direction of the S&P is critical to profitable trading. Here's what the S&P has looked like over the past half year. One interesting thing people have quickly forgotten is that people were having heart attacks last November that the S&P broke 800, but it only was there for two days. It just spend the entire past month below 800, and people have become accustomed to it. In fact, they were thrilled it was wayyyyyyyyyyyy up at 800 again! How soon people re-acclimate.


But I want to point out that, besides the line in the sand at 800 (which is mildly tough; I wish I had shorted more /ES this morning when it was bobbling around 800, but yesterday's wounds left me too sheepish). The more important levels are 881.38 and, the really important one, 1014.14. The area around 1000, which is both Fibonacci retracement as well as the underbelly of a huge descending trendline, is going to be the Incredible Hulk to the bulls out there. I hope I can be a decent trader as we might our way up to 1,000 this year, but God Help The Bulls when we get there, because I will turn into a snarling maniac. I won't be talking about 666. I'll be talking about 400.

Here is sorta kinda how I think things will play out. Because I am blessed with an amazing intellect, I have created this using the WAG technique (ahem; Wild Ass Guess). The timing is probably more squished than it should be; a plunge around September/October would be more poetic; but the chart below smells about right ot me in terms of what 2009 holds.

My main challenge, as I imply, is to trade well on the way up. I'm a better bear than bull, and I really, really need to fight back my bearish nervousness about holding stocks. That's it from me for now. Good night!