Any comments on today's price action?
- Thread starter reno4nook
- Start date
I fail to see how you connect commercials and "foreign money". Your thesis on "foreign money" moving the markets is a whole lot of conjecture with no factual basis. Having said that, I'll go out on a limb and state that we're inside of a immediate correction inside of a short-term uptrend inside of a secular bear market. DOW 11K *will* be tested before next years elections begin.
Quote from reno4nook:
What in the world happened today??
The Dow, S&P, Financials all slammed DOWN hard....!! and yet the Russell, Semis and Nasdaq UP slightly!?!
Was it the Last day of the month window dressing?
Was it Wash sale rule selling?
Were Interest rate sensitive stocks dumped while others not??
Is there even one most excellent, worthy and enlightened market master who can solve this great forbidding mystery??
===============
Reno4;
You mean besides DIA/dow is an underperformer, consistantly???
And QQQQ,semi sector usually do strong 4th quarter.
End of day SPY ONLY WENT DOWN 0.54%, ;
dont see what you mean, even intraday ,
''slammed down hard''????????????? What mystery???????????
Sell volume was below average also,SPY,DIA.
there is a BIG reason why i have been talking about this is several threads at ET --- you NEED liquidity to raise a market. I have stated that the rally we just had to this point over the last 4 weeks was companies buying their stock back, foreign monies pouring in to buy a "market" with value {we were down in the 1170/80 SPX area at the time of the influx}, and hedgies and institutions buying again.
ok, so if we yank out the foreign funds {like happened in early october} then what "liquidity" will replace theirs? follow "trim tabs" and you will see that ma and pa are NOT buying into this rally in any significant numbers {no great mutual fund inflows -- or new liquidity}. what i am saying is that our current market situation is now "sensitive" to the moves of foreign monies as they make up a HUGE percentage of the inflows lately {and then outflows when they shift their funds to OTHER countries markets}.
What it all comes down to is the world markets {China, Japan, EU, Dubai, South Korea, Latin America, and the U.S.} are being "DAYTRADED" by extremely large amounts of foreign dollars ---- they are shifting monies around at pace not seen before.
makes sense too --- what would you do if you had hundreds of billions and were bored after such an extremely profitable year with your ever increasing "petro wealth"?
So which market do you think they're going to rotate their petro-dollars into? Maybe Gold? I agree that of late the Arabs have been getting smarter with their money. Maybe it's the realization that their oil is running out or maybe the new western educated arab royals are not as dumb as their parents ? Finally, how does one track this flow? I'd think it's close to impossible to track it's movement unless you're an insider doing the moving.
the institutions know when the foreign dollars are liquidating positions, so what would the institutions do with THEIR longs in the same holdings that are being sold off by foreign players?
they bail also and move some of these monies into other stocks that they are comfortable with during what could be a corrective sell-off --- they rotate and get defensive with equities {also they are adding short futures positions to hedge their long equities holdings}. So near a top you can get a double whammy --- equities selling along with building futures short positions.
i have some contacts that i get foreign "flows" info from, and the U.S. Treasury department is the "official" tracker of the foreign flows. this "foreign money movements" has been talked about by many money managers on the street and in chicago this year so the ideas i am talking about have been out there for several years {also, guess who yanked a bunch of liquidity out of our markets in February/March of 2000?}.
look at the EU markets --- look at the Nikkei and you can see some of the others who have benefited from foreign inflows {yes the Japanese economy is doing good so that helps their market, but are the EU economies so great that their markets should be at 4 year highs?}.
Dubai, South Korea, some Latin American, and the Chinese markets have all been greatly helped by these foreign inflows --- the problem hits when those funds quickly "shift" to the next "hot or undervalued or safe haven" market. so i expect volatility to greatly increase going forward in numerous markets and not just ours, and this is going on when the western economies are doing good --- what will happen when these economies have their next "recessionary" cycles??????????
yes Gold {gee wally, gold is at $500 now --- what liquidity caused this?} has been helped by this and Oil --- yes why not play Oil "long" heavy all the time with your foreign "petro wealth" dollars {buy every dip --- who gets helped by oil staying high in price? :eek: }. wished i could be in on this free "petro wealth" money racket!!!!!!!!
you are right the Arab young {the business minded} are exceptionally smart with their monies {look at what is happening in Dubai} and they do not like to let those funds sit static --- they want their dollars in the game all the time {this will bite them very very hard one day!}.
yes it is somewhat difficult to track these flows but i am working on that --- i think this information will be more "requested" going forward by many who manage/trade money. the importance of tracking these flows will become more apparent as the markets volatility starts to cause "non-historical" market events.