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.

The Perfect Trendline

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I wrote to my Slope+ subscribers yesterday that the surge in prices was definitely NOT a “buying opportunity”, and that I would view 1570 as the target top & line in the sand for the day. Well, it went to 1570.75, so I hope you’ll allow me a tiny bit of slippage

The trendline on the minute bar chart is breathtaking (shown in red below); it followed the price points magnificently; the real question here is whether we’ll take out Wednesday’s low, or Yellen will use the force of her Old Crone Magick to reverse things. I remain cheerfully short.

Oh, and incidentally, the latest LDI reading shows the following: “yesterday [Monday] close was a once a year time to buy a real dip. I bought two more SPY 160 Calls.” – so ignore that at your peril.

0417-es

Flogging A Dead Horse

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There’s little doubt in my mind that this move up from November has topped or is topping out, but the exact form that top will take isn’t yet clear. We would normally see an H&S or double-top form on SPX at this sort of high and to form a double-top would obviously require a retest of the highs. Whether we see that or not is currently also not yet clear, but the declining resistance trendline that would need to be broken to open the path to that retest is very clear, and here it is on the ES 60min chart:

130417 ES 60min Declining Resistance

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Well That Escalated Quickly

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Well, it’s really, really obvious now that the final vomiting up of stock sales happened very close to yesterday’s final bell. The ES bottomed at about 4:30 EST and it did nothing but climb between then and now. I don’t mind that I still have the vast majority of my short positions, but if I had it to do over again, I would have closed out my larger ETF shorts at the close. That kind of rush for the exit is probably going to be reversed, and it was.

I’ve backed off quite a bit, having taken my portfolio from a 95% commitment level to 66%. I got blown out of my only large short – FXE – at a loss, and many of my individual stock holdings were up 2%, 3%, and even more on the day, meaning, of course, a chunk of my profits from yesterday were eaten alive. (more…)

The Worrisome Euro

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Well, the only big short I had coming into today was FXE, and I got stopped out of it at a loss. I’m not touching it again, because the EUR/USD has pushed too much to the upside. More important, I am quite concerned that the inverted head and shoulders pattern – – very much intact – – could pose a meaningful risk to equity bears. This demands continued observation, as it could certainly influence equity strength in the weeks ahead.

0416-euro