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.
Even Slicker Than ES (by Trade Flight Plan)
As a quick followup to our ESpresso! post, we thought we would share a snapshot of oil, one of our favorite futures instruments. But first, a quick update on that rascal /ES…
– 1160s (prior S/R level): BROKEN
– 1175s (a highly regarded level): HIT
– 1200s (are they serious?): NEXT??
– 1230s (the end of the bearish condition): SERIOUSLY??
Now back to CL… Last week, we circulated our latest CL analysis with a group of likeminded traders. OPEC, French oil strikes, QE2, Chinese demand, and record inventory levels aside, here are the major levels we have been watching for a couple weeks. Our states report on oil includes:
– 81.60 (support): HELD
– 83.10 (defended by buyers and sellers many times yesterday): HIT
– 83.80 (the next volume cluster): HIT and TESTED last night again during globex
– 84.60 (prior highs): HIT at 84.50, we're not sure we would want to short this level again if we retest
– 86.50: ARE THEY KIDDING?
These levels are not necessarily probabilities, but price discovery and value area possibilities.
Just for kicks, let's check out what the commercial entities are doing with their oil positions based on the latest weekly Commitment of Traders (COT) info. These are airlines, producers, transportation companies, and other big hedgers. Same rules apply as last time:
Red=commercial traders, yellow=small spec traders, blue=large non-commercial traders.
Green vertical lines show relatively high COT readings by the commercials. Red vertical lines show relatively low COT readings for these slick oil hedgers.
Hmmm, someone's getting ready. They might be early, it might not happen for awhile. But it sure looks interesting.
Pet Peeve #3,829
I use FedEx from time to time. Surely this is a site used by millions of people every day.
So why……..tell me, why?……..do they insist in presenting the dropdown of countries in alphabetical order? Wouldn't one assume that, say, 90%+ of all usage is in the United States? Why not put, say, the top five most used countries at the top, put in a dividing line, and then oh-so-democratically show the list of all countries in order?
So what's the easiest-to-access choice right now? Freakin' AFGHANISTAN! Yep, I'm sure there are lots of packages leaving Afghanistan. When your ammunition absolutely, positively has to be there overnight.
FedEx isn't alone in this idiocy, by the way. A lot of web sites that call for an address to be entered have the same logic.
And this, my friends, is why ProphetCharts is so great. Because I'm an absolute bitch until things are the way I want them to be.
Harumph.
Education Covered
This is one morning where I'm really glad to be in hand-chosen stocks instead of general market ETFs. I had a quintet of for-profit educational firms (APOL, WPO, ESI, DV, CPLA), all of which got smashed by APOL's guidance withdrawal yesterday afternoon. I covered all of these positions early this morning at handsome profits. In this market, better safe than sorry for the bears.
Mass Bear Capitulation (by Springheel Jack)
We crossed some big lines in the sand yesterday and the equity bear camp across the blogosphere is capitulating en masse. They're right to capitulate as this is clearly a big impulsive wave up, and waves like that tend to come in groups. Until something serious changes, then the bulls are in charge and that should be respected.
It has been my view for a while now that we are in a new bubble (of three big bubbles in recent years), fuelled by government debt and money printing, and that this bubble would be likely to continue until government profligacy provokes a big bond market crisis. That's still my view, and that crisis looks to be at least a year in the future, and perhaps as many as three. Until that happens there's not much mileage shorting this market in my opinion other than for short term reversals, and the big summer reversal looks over now.
The Nasdaq broke both the intraday and closing April highs yesterday:
SPX is still in the main rising channel from the last low, and the target for the next hit of the upper trendline of the rising channel is in the 1210 – 1220 area. Pug's primary scenario now has this wave up finishing in the 1215 area and that might well be right. Regardless of that no end for the wave will be confirmed until that SPX rising channel is broken:
However I think it would be a mistake to think that we're just going to shoot to the moon here while USD dives towards zero. On USD particularly there is every reason to think that we will see at least a strong bounce and very possibly a major reversal in the near future. We're coming up to the key support level on the USD chart, and sentiment looks very promising. Dollar bulls were down to 6% at the big low in March 2008, and 3% at the higher low in November 2009. They're at 3% again now and the rising support trendline from those two lows is at 75.8, not far below the 76.6 level at the time of writing. That support trendline could break of course, but the odds look good for a reversal there:
There are other reasons to think that USD may bounce there. AUDUSD has not yet reached parity with USD, unlike CADUSD which did that yesterday, but that's likely to happen soon, and I have a major resistance level in the 101.2 to 101.5 area:
I've posted the copper chart quite a few times as well pointing out the overhead resistance in the 392 to 394 area. Copper's been as high as 386.75 this morning so we're close to that too:
Can USD rise while equities are also rising? Yes, and that's exactly what we saw for five months between the last USD low in November 2009 and the equities high in April 2010. The equities low this summer was also made a month after USD topped and reversed, so there's no reason to think that can't happen again.
