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Those 4 C’s are: Confirmation, Crisis, Contagion, Catastrophe.
What type of confirmation could send the financial markets into such turmoil it could rock the very bastions of finance as we now know it?
First: Scotland votes yes to leave the U.K. If this turns out to be so, it could send shock-waves throughout the markets that run the world. i.e., Forex or World currencies.
No one with any financial acumen can look seriously at the markets as they stand at the time of this writing, and seriously argue the markets are prepared for such a resolution happening this Thursday. (more…)
Fed days always put my stomach in a knot. I definitely don’t “load up” before these events, but I was still fully in position on the short side. As you can see from the spinning top (candlestick) below on the ES, it was a roller coaster of a ride.
We take the Way Back machine to a time of normalcy and plenty, in the 50’s when the stock market did okay but savers were paid (through T Bill yields) to do the most prudent thing people in a natural economy can do… save. Ever since 1980 the theme has been for the nation to eat its seed corn, with asset owners getting increasingly more portly in the process and savers nudged ever further out to the margin. The S&P 500 has sure got no complaints these days. It’s in lockstep with policy.
Yesterday, The Wall Street Journal dove head first into the deep end of the interactive social media swimming pool. During their FOMC pregame show, they punctually trotted out Johnny Waterboy Hilsenrath via SpreeCast, the sparkling new-media darling interactive webcast platform, to serve up another fresh jug of spiked reinvigorating Gatorade to his favorite NY Stock Market team. (more…)
SPX broke back over the daily middle band and the 50 hour MA yesterday, and just to underline the point, Dow broke over the 50 hour MA and managed a new all-time high. The falling channels on NDX and NYA also broke up hard. The retracement from 2011 should be over and we should see a retest of the SPX all time highs in the next few days.
So has this RSI 5 / NYMO sell signal failed now? Not yet. Of the 29 previous signals back to the start of 2009, a full nine of them reversed back up to a new high before then making a lower low. One of those signals then failed and eight made the RSI target. As there were only four other failed signals, that gives better than two to one odds here that a new high on SPX would be followed soon after by a low under the retracement low at 1978. Given that nice looking double top setups are forming here, we may be looking at a marginal higher high coming, and then a deeper retracement into the 1940s and very possibly further. (more…)