The FOMC bombshell wasn’t a complete surprise yesterday. I did mention in the morning that the Fed’s capability or courage to tighten policy was mainly theoretical, and it’s still mainly theoretical this morning. Of course the Fed have to walk a fine line between blowing up an asset bubble, and depressing the economy by removing the highly addictive stimulants that may be all that are maintaining the appearance of continuing economic vigor. The US is fortunate to have such a dedicated and highly qualified team operating the printing presses day and night, 365 days per year, and seemingly prepared to do so for the rest of time, or until the value of the US Dollar falls to zero, whichever comes sooner: (more…)
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.
FOMC Taper News Day
Today is likely to be dominated by the FOMC Announcement at 2 PM. That announcement seems likely to contain details of when tapering will start, the scale and structure of any taper, and possibly a draft timescale for the tapering to zero of QE3 over the next year or two. This is significant market moving news so many traders will be avoiding carrying any exposure into the announcement. (more…)
Dealing with Rejection
I came into yesterday assuming that we would see a bit of a pullback during the day, and then would most likely make a new 2013 high this week on SPX as the weekly upper bollinger band (BB) was tested. That could still happen, but yesterday’s strong rejection from the open and weak close was characteristic of a high, and the short term high may be in. Also, though there was some action above the daily upper BB (which rose by ten points) yesterday, the body of the daily candle was under the upper band and the close just underneath it. This suggests strongly that at the least the daily upper BB is likely to be respected as resistance today and I would put the maximum likely closing range in the 1703-7 area. We may well see much more bearish action to fill yesterday’s open gap however. SPX daily chart: (more…)
A Bollinger Rarity
I’m starting with a detailed analysis of the current rare bollinger band setup this morning, so if your interest in TA is limited then you might want to just skip through to the charts.
I was saying yesterday morning that the daily upper bollinger band could move up five to eight points every day in a strong uptrend, and was slightly taken aback yesterday at the close when I saw that the upper band had fallen from 1688.65 at the close on Wednesday to 1688.20 at the close on Thursday. The reason for that is that the 20 day moving average, which is the daily middle bollinger band, is still flat to slightly declining, and as the upper and lower bands are two standard deviations away from the 20 DMA, then as the 20 DMA declined slightly over the day, so did the upper band. (more…)
