Oil beginning to threaten SIFs

Ok some facts:

1) We are in a bear market
2) There is generally no such thing as a tripple bottom on the long term charts


While the action of SIFs have been nothing short of heroic considering the F5 they have withered, price action suggests that we break the 1270 low and close below it.

First target is 1250. Then every 25 handles to the downside. No one knows where the bottom will be. 1200 is possible.

Many are saying the second VIX spike to 35 was the tell that we were looking for to see a bottom. That and a major bank failure. I doubt it very much. Doesn't mean it isn't true, but it would be unprecedented AFAIK.

To investors, back to tiny shares long.

nitro
 
Looks like SIFs are going to 1350 or possibly even 1400.

I am very cautious. All those tiny shares I have recommended go long, imo it is prudent to start selling some of those tiny shares back into rallies.

At 1400 SPX, imo you should be flat. If you were more aggressive at 1270, congrats, you made $.

nitro
 
Obvious support at 1320 SPX. If it goes through 1315, SPX is in grave danger.

To investors, we are back at tiny shares long. The one thing that has changed is the Average True Range. We add long on dips on good companies, but we add at far larger intervals until the vol goes down.

We no longer add aggressively at 1270. If this thing goes back there again, we go much lower. It's tiny shares until further notice.

nitro
 
1295 SPX is the only support left except the actual low. Then it is asta la vista, baby.

Rumors that MER may be in some trouble. I really doubt that rumor tho.

nitro
 
Quote from nitro:

Oil goes to $110 at this point, or a touch below. Then first support is 106, then 100. I think it sells off into both of those once the $110 target is reached, unless the FED hints that rates go to zero, in which case it goes to 115-120.

...

nitro
More...
Ok, the first leg of the commodities bubble sell off is in. Imo both oil and gold (which is getting killed again this morning) find some stabilization at these levels. But that doesn't mean they are a buy.

However, if they don't stabilize, especially oil, it will have an adverse affect on SPX, since energy is such a large component of the SP these days.

Quad expiration on a three day weekend no less will make this trading day challenging. After the phili-Fed. the last hour and a half or so is where the greatest danger lies to the downside imo.

Under no circumstances buy 1270. If we go there again, we go lower, probaby landing at 1250 SPX and then market action will finally flush all but the most hard core bulls. 1175 SPX as a final target if we lose 1270 is possible. But we let the market tell us when the bottom is in, not pundits on TV.

nitro
 
Just got this news from my partner:

10:29 03/20 REPO: We hear there are negative repo rates again - reflects
settlement problems, dealers say as these negative rates increase the chance of receiving the securities. 3m bill (6/19) traded at -0.20% and the 4.25 9/12, 3.375 11/12, 3.625 12/12 are all bid at -0.25%, a source says.
"PD" trades will be coming soon he says!
More...

This is potentially a sell into 1295 SPX support. Either way, this is not good news.

Just so that you know, my programs are long, but I think I lose money.

nitro
 
For the time being, sure feels like the market has the wind behind it's sails now. I don't get bullish until we close > 1420 SPX. Obviuous first resitance is just below 1400 SPX, 1392 or so. Then 1400 then what really counts, 1420.

There is a certain voice that nags at me, the downside is not done. This could be years of subconscious experience offering it's wisdom, or alternatively it could be that I am "anchored" as discribed in this thread:

http://www.elitetrader.com/vb/showthread.php?threadid=121967

I feel kind of stupid for suggesting that investors should be at tiny shares long instead of at least with the pedal half way down the metal. At best it's prudent. Thank gawd that my models/programs don't "think" and are long all the way today. I think I would have stood like a deer in headlights watching it go higher, and missed a massive day, were I left to my own devices today.

Be careful last hour. Although highly unlikely of a huge sell off, as tops form violently, and this market doesn't have that character.

nitro
 
The action in NQ leads me to believe that ORCL's earnings are likely to be very good.

Remains to be seen how it affects the rest of the stock market. Even though the fed gives with one hand, it is taking with the other through REPOs. All I see is IRs creeping up slightly each day. That is bad for tech overall.

nitro
 
ES option skews look really tight to me. Market is expecting low volatility out to June as measured by todays prices.

nitro
 
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