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.

Symmetry Everywhere

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I thought that it would be pertinent to post some interesting activity that seems to be coming to a conclusion imminently…yes, I know its been a rough slog for the bears…but the Nasdaq which has been a leader of the entire move off the lows and also was the harbinger of the biggest bear this side of 1980…has now completed a very symmetrical pattern. There is both time and price symmetry.

Markets love symmetry…and these levels definately have it!

The irony is that though this market has been pushing relentlessly there are these pretty significant road blocks…not the least of which are the 80 year trendlines on the DJ and the 30 year trendlines on the SP500…below are some things I think that should be kept in mind at this as the market seems to capitulate at these levels. (the SP and DJ monthly charts are from yesterday)


In addition to some of these longer-term trendlines…the DJ Utilities look like they are starting to rollover after a lengthy and rather unimpressive retracement.


How is Dr. Copper Feeling? (by Leaf_West)

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I have blogged in the past about how useful Copper is as an indicator of global economic health … it will often give us good signals in front of equity market pivot points/swing areas.

Read some of those blogs here …

Copper Hits 1st Wave 5 Target

FCX … What is Going On?

FCX/Copper … What is the Right Message?

What is Dr. Copper Saying ….

Below is the daily chart from the Copper ETN (JJC) …

JJC_Feb16, 2011_Daily

The chart is telling us an interesting story right now …. as discussed in a blog identified above, Copper hit its 61.8% Fibonnaci target for Wave 5 when it moved into the $61.60ish area.

Well since I wrote that article, Copper made a retest of that high and "failed" … price moved back to the 20EMA ($59.68) which is also right at the Wave 3 top of $59.6399 made on January 3, 2011.

I have called this level the "line in the sand" … if price breaks this level and stays under it on a closing basis for a couple of days, I would use that as your WARNING that equity markets are going to top here soon.

Keep you eyes on Dr. Copper!!!

In Case We Weren’t Cynical Enough

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A thoughtful Sloper sent me the latest Rolling Stone article Why Isn't Wall Street in Jail? by Matt Taibbi which is going to be on the Rolling Stone web site next month. It's the sort of maddening article which shows – yet again – how Wall Street is nothing but a gigantic cabal of rich, sophisticated criminals who can break any laws with utter impunity.

Reading such an article doesn't do anyone any good, unless you like to have your blood pressure soar, since these scumbags are going to continue to get away with it in perpetuity (even the "liberal" Obama has done nothing but grease the skids for these guys). But the closing paragraph of the article sums it up nicely:

The mental stumbling block, for most Americans, is that financial crimes don't feel real; you don't see the culpritswaving guns in liquor stores or dragging coeds into bushes. But these frauds are worse than common robberies. They'recrimes of intellectual choice, made by people who are already rich and who have every conceivable social advantage,acting on a simple, cynical calculation: Let's steal whatever we can, then dare the victims to find the juice to reclaim their money through a captive bureaucracy. They're attacking the very definition of property — which, after all,depends in part on a legal system that defends everyone's claims of ownership equally. When that definition becomestenuous or conditional — when the state simply gives up on the notion of justice — this whole American Dream thing recedes even further from reality.

Understanding The Big Picture (by Ultra Trading)

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A few weeks back after the banks reported earnings, I compared the reserve rates for the top four banks. Clearly, WFC stood out as having a lower reserve as a percent of total loans and leases. 

With the recent and sudden departure of the WFC CFO rumors began circulating as to why Howard Atkins left a high paying job, very suddenly and at a relatively young age. Well today one of the best bank analysts is shedding light as he questions the validity of WFC's disclosure process.

"The departure of Atkins, we are led to believe, was not merely the result of personal issues, but reflects an ongoing internal dispute within [Wells Fargo's] executive suite regarding the bank's disclosure," 

There is a lot of noise in the market right now. Bank stocks seem to catch and endless bid but the problems have not gone away. Understanding and staying focused on the bigger picture, beyond the day to day noise is critical. You are better prepared to understand how to respond to the WFC news today and determine if the sell off is an overreaction or in fact true pricing of real risk at WFC.

Submitted by Ultra Trading.  If you would like to read more, please visit - Ultra Trading

Wedges Everywhere (by Springheel Jack)

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I know I've been sounding like a broken record lately, but while the market continues to make new highs, the underlying technical picture continues to deteriorate, and I'm still of the view that we're going to see at least a sharp correction soon. Obviously POMO is still force-feeding the market with billions of dollars every day, but that was the case last January as well, and didn't stop SPX from correcting 10% from the high then. I'm doubtful about seeing a major top before QE2 finishes in June, but that's only four months ago now, and on any measure equities are looking rather overbought at the moment, and the pattern setups suggest that the risks are weighted heavily to the downside here.

On the ES daily chart the rising wedge from the July low is still looking pretty good, and I'm expecting at least a return to the lower trendline soon:

Shorter term on the hourly chart there is now another rising wedge on ES with the support trendline in the 1225.75 area at the moment:

On the NQ hourly chart there is yet another rising wedge with a lovely support trendline with five perfect touches so far. I'm expecting some decent downside action as and when it breaks and support is now in the 2380 area:

Elsewhere EURUSD is looking weak and I'm expecting to see more downside today with at least a test of the recent low coming up. I'll post an update on that tomorrow as I want to cover silver, copper and oil today. Silver looks weak with a possible double top on declining RSI. It has tried twice and failed to recapture the lower trendline of the broken rising channel. An H&S pattern may be forming:

Copper also looks weak here with another possible double-top on declining RSI. Another H&S pattern may well be forming:

Oil made a succession of marginally higher highs on declining RSI, and is now correcting. Another H&S pattern may well be forming:

Obviously there is a heavily bearish theme to what I'm seeing, but it is what it is. In my first post of December I was calling for a wave up, and I'm now expecting a wave down. Nothing goes up in a straight line, not even this, the strongest cyclical bull market in history by a wide margin. I'm expecting that we might see a bit more upside today but IMHO at least, when those support trendlines on the ES and NQ hourly charts break down, we'll be moving onto selling the rips for a while.