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.

Adjustments of Dates

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Crystal_ball

Readers of the weekly report know by now that short term cycle
has indeed bottomed. But some changes need to be taken into consideration. The
last short term top was due on September 7th, but came on September
14th, about 5 trading days late. The Short term bottom was due on 10th
October but actually came on 12th October. These changes call for adjustments
for future dates.

Earlier I was calling for another short term bottom around October
24th or around that time. With the shift of dates as mentioned above,
I now think that the next short term top will be around October 24th-25th,
instead of a bottom. The expected short term bottom should now move to October
29th– 30th. The final melt- up date remains the same.
From end of October till 12th-14th November.

Getting confused? Well, let me put in another way.  A complex topping process is going on. We knew
that this correction was coming and was prepared for it. Now we also know that
another pop is on the way and that would run for next 8-10 days. But that would
not take us far and that is not the final pop. I have written before that we
have one more scare coming. My expectation is that we will see a swing low
around end of October. I cannot say for sure whether that low will be lower
than the current low and that will depend how high this one goes. And please
keep in mind during this short term pop will not be one straight line. Talk of
meat grinders!

And a strong caveat: I cannot predict the future. I try to
best guess the market based on certain models. So far most of these calls have
been on track but while anticipating multiple turns in advance, one has to be
ready for quick changes in the plan. I am not playing the market till the end
of October (earlier it was 24th October). And I would not recommend
that anyone does either. Patience is the watch word.

I was little disappointed as to how much gold and silver
sold off but on the other hand these are good entry levels. Silver bounced off
from $32.50 and gold is very close to $ 1740. If you are not already holding
precious metal and planning to take core, long term position, do not jump in
all at once. You must scale in. For e.g. if you are willing to allocate $ 10000
to PM sector,  instead of investing the
entire $10K at one shot, do it in 3 or 4 instalments. Therefore if tomorrow price
of silver is above $33 (close) and price of gold close above $ 1740, you may
want to allocate 25% -33% to get in. I hope you get my drift. With PMs, we are
talking very long term holding periods. Few years at least. So invest
accordingly.

Our dear reader dc_BEAR has sent a Bradley Date chart with a
comparison of actual SPX price movements. The comparison was originally done by
Tim Knights of SOH.

Bradley dates

Surprisingly the dates are matching very close to the cycles
which I am working with. Let us see how it plays out but this is eerie.  

I know lots of readers here trade short term. One of my friends
called in today and asked me to put in ideas about Options. This is something I
would tell regular investors  to stay
away from. I want to emphasize that if you must trade and deal in options, have
separate accounts and allocate only a small amount of risk capital for option
trading. Even if you lose 100% of your option account, which is very likely,
your core investment will not be affected. My friend agreed to my suggestion. If
you folks think that this is something you would like to take a look at, I will
have to start a separate blog on Options. I absolutely would not want
retirement savings going in option play.

I have been pounding the table for “Relaxed Investor”
approach and to take a long term approach to investing for quite a while now. Yesterday,
Josh Brown of The reformed trader wrote the following:

A portfolio
compounding at 7 percent will double in 10.5 years. Thus, if a client has 20
years of working, saving and investing in front of him (and our nemesis
inflation compounds at just 2 to 4% a year) the reality is that we'll be just
fine (even if a bit envious at times of an Icarus trader's good fortune and a
bit smug when they inevitably crash back to earth). Dicking around with small
cap Chinese coal miners just because "they move, bro" simply doesn't
enter into this goal-oriented approach. And once the goals become simple, the
methodology ought to be every bit as simple. I tell people that if I ever start
talking about delta hedging I'm probably high on something and they should fire
me.

I have written the same thing in the last weekly report.

That’s all for tonight.  Hope the up momentum is maintained tomorrow.
Please continue with your help and support which is absolutely critical
to keep the blog running. Do remember to disable Adblock.  Also please send your feedback on the weekly
report so that I can make necessary changes as per your needs. Thanks for
reading
http://bbfinance.blogspot.com/  join me in Twitter
(@bbfinanceblog)for the real time market updates and calls.  And if time permits visit and comment on
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Confused and Conflicted

By -

Before I start today’s post, can I draw your attention to the
post of October 3 http://bbfinance.blogspot.ca/2012/10/wooing-wednesday.html
. There I wrote the following:  Normally
the 1st break, up or down is a head fake and the real move is opposite. 

After 5 trading days, you can see the validity of that statement. SPX broke the
triangle to the up side and now stands at the bottom of the Bollinger Band.

The cycle low which was expected today did come on schedule.
However it closed below my target line which was 1430 in SPX futures. At the
time of writing this post, /ES (Futures) have broken below that line and is
sitting at 1422 which is convincingly below the line.

(more…)

Please Don’t Front Run

By -

Bull_bear

I see and read in many blogs and forums that folks are
talking about “Top” and as we had a failed test of high, the trend is now
changing. Knowledgeable writers are saying that market rose from June low on
the hope and expectation of QE and this rise was in fact a hope rally. Now that
the surprise factor has been taken out and as tops are formed at the high, time
is ripe for a major pull-back.

(more…)

W.O.F +

By -

It was a” hurry up and go nowhere” kind of a day. In the
morning, around 8.30 AM eastern I sent out this tweet: “GMA. Going to be like yesterday. Risk rally on old stories and fade
during the day. it has to break either way. Tiring”
. Around 9.40 AM
eastern this tweet;” Cash SPX opened with
the same range of yesterday. Oil is selling off. PM sector is weak. We may get
some selling later
”.  Then we had our
little sell off and at around 12 noon eastern this one: “Well, we have the sell off and I think we are done for the day.rest of
the day will be Chop Zone.”

There were lots of other tweets but basically those three
sum up the day. More the reason you should join me in Twitter (@BBFinanceblog)
so that we can communicate real time market action.

Coming back to the market, 1st let’s take a look
at the daily chart of Euro:

Euro

(more…)

No Cigar Yet

By -

I am amazed to see how quickly the sentiment changes from
euphoria to doomsday. Was it last week, there were talks of SPX 1500 or higher?
And now the coming doom! Part of the reason being the Fed has taken out the
surprise factor. For last three months the Pavlovian dogs have been drooling
about the coming QE and now that it is here, they are caught in the headlight.  And so far we just had about 2% correction.

SPX

(more…)

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