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.

What Would You Like in ProphetCharts?

By -

Now that I've completely stunk the place up with my dour mood, I'll try to pose a constructive question: if you are a ProphetCharts user, what new features would you like to see in it?

Understand that I've got a long list already, and I've run a survey or two on this topic before. But I'm fleshing out my list for the year, and I'd love to hear your input.

Instead of doing a formal survey, I'd just like to ask that you put your request in the comment section; if someone has already made a similar request, just click the Like button on their comment. That way, I can simply sort by Best Rating and get a feeling for what people would really like to see.

Thank you!

Serious Incursions into Russell Territory

By -

My principal concern these days is that the progress the Russell 2000 has made into its ostensible head & shoulders area is severe. This pattern is, for me, the Holy Grail of the market that I am (or that I was…….) anticipating. The evident violation of this pattern calls into serious question my thesis, hence my urge to jump in front of a CalTrain locomotive.

0303-iwm 

One Talented Bunch

By -

From the Financial Times (ft.com)……with a few points of emphasis by me…….

Goldman Sachs made at least $100m in net trading revenues on 131 days last year – equivalent to once every other trading day, according to a filing with the Securities and Exchange Commission on Monday.

Goldman managed the result even as it took greater trading risks in 2009 than in the previous year. Its daily “value at risk” (VAR) – the most that the bank estimates that its traders could lose on a given day – was $218m in 2009, up from $180m during the previous fiscal year, which closed in November 2008.

Goldman earned a record $13.4bn in 2009 as net revenues more than doubled to $45.2bn and the bank reined in compensation costs amid a furore about bonuses earlier in the year.

Goldman’s 131 $100m-plus trading days in 2009 shattered its previous high of 90 days, set in 2008. In last year’s 263 trading days, the bank lost money 19 times, Goldman said in the filing. Its daily losses never exceeded $100m. “It’s impressive, but it’s not unexpected,” David Hendler, an analyst with CreditSights. “They were one of the few games in town in 2009.”

Goldman’s performance came during a year when the demise of several rivals left it and fellow survivors better able to capitalise on the flurry of debt and equity trading that followed the financial crisis.

The controversy over banks’ profits and compensation policies, and an uncertain outlook for both the markets and financial services regulation, could make it difficult for it to approach 2009’s performance any time soon, Mr Hendler said. And competitors had regained their footing. “It may have been a high-water mark.”

Trading and principal investments, which includes Goldman’s merchant banking activities, account for more than 75 per cent of its total net revenue.

The rise in Goldman’s daily VAR was “principally due to an increase in the interest rates category” as spreads widened, and a “reduction in the diversification benefit across risk categories”, the bank said. The bank’s VAR tied to commodities trading declined as energy prices fell.

The bank reports daily VAR at a 95 per cent confidence level, representing the one-day trading loss that it would expect to exceed only 5 per cent of the time.

The SPX Rally Channel & the 41 day Pivot Cycle

By -

I was shocked to find a beautiful channel on the SPX daily chart
last night that encompasses the entire rally since March 2009, with the
top and bottom trendlines traced from the November 2008 and March 2009
lows respectively.

It has only become obvious with the recent low at 1044, as that provided the second touch to define the lower channel trendline:

100302 SPX Daily Channel

I was shocked because I thought that the SPX had broken all key
uptrend support trendlines, and it is now clear that just isn't the
case. The uptrend channel is still intact.

On the plus side we now have a very powerful indicator for when this
uptrend does finish, as confirmation will come with a break with
confidence of the lower trendline. In the interim the centre trendline
should provide significant resistance in the event that another
substantial wave up gets going. I couldn't help noticing that by the
time we would reach it in the 1180 – 1200 area, it would be in the
region the potential  IHS on SPX is indicating to.

Not a cheery read for bears I know.

On the other hand all channels do break, and this one could break
soon. it is a rising channel and a retest of 1044 would more than
accomplish that now.

I do have something more cheering for bears to read as we are coming
up to the pivot cycle date for my version of Joe8888's 40 day pivot
cycle. My (slightly modified) version runs 41 days with the 42nd day
not counted, and on my chart the 41st day is next Monday 7th March.
Unless we have a major selloff between now and then, this should be a
pivot high like the last one in early January:

100302 SPX 41day Pivot Cycle 

In the very short term we almost made it on Tuesday to my next upswing
resistance line at the broken blue dotted trendline on the top SPX
chart. I'm not expecting that resistance line to be broken before the
next swing down, but we could spend a few days testing that (rising)
trendline before the next swing down begins.