Well you’re probably thinking I’m talking about our president, but no. A few years before him my wife was born, so happy b’day honey!
The markets must have been happy also….but I think it was more a reaction to reports. Although we had good reports for ADP Employment and ISM Services, China came out saying they were going to stress test their banks for a 60% drop in mortgage value. Hmmm, sounds like they may know something? Well it was enough to spook traders and the markets came down pretty hard….and that was the first hour! 
The rest of the day the markets just meandered up and down, but closing green with an A/D volume of over 2:1. So we’re still sitting good, but trepidation about Friday’s employment report may keep things subdued for Thursday. On the other side of that argument, Thursday’s Initial Claims report may stir it up!
Here’s to the rest of the week acting like the first part….profitable. Now, back to the birthday party. 
Ok, it’s not what I would call a follow-through day, but it was a decent reaction to yesterday’s up move. Neither day had any volume, but today’s consolidation was on lower volume than yesterday’s explosion. So far, we’ll still sitting good for a continuing up move.
Asian markets are opening soft with the Nikkei down almost 2%, but S&P futures are still hanging around breakeven. Gold is trying to move up and oil is moving down.
Wednesday brings us the ADP Employment report at 8:15AM…..the predecessor to Friday’s big show. We’ll see if the markets deserve to continue its up move. Maybe oil inventories will help. The US$ levels are getting low enough that if it goes any lower, stocks may begin to worry. I’d actually like the $ to stabilize.
So much analysis, so little time. 
Wow! Great moves in the market today! The Dow broke through the June and July highs on the first trading day of August!
The S&P is close but still needs a few points.
Now of course, volume was not that great so many will say it’s not a “real” rally, but it doesn’t matter to me…weak rally profits spend just as well as strong rally profits! 
I traded about 20 minutes in the morning and about 35 minutes in the afternoon…and it was a good profit day. Now time to look at charts while I soothe my sunburn…ouch.
Stocks opened Friday way down after traders reacted to the GDP numbers, but soon began a journey on the way up after good PMI and Consumer Sentiment numbers. All the indexes closed very near breakeven, for the day and for the week….some a little red and some a little green. We also ended up having one of the best Julys ever. Of course though, we only recovered what we had lost in June.
Futures are taking off early this evening, moving up almost 1%. If this can hold overnight we should have a good start to the month of August. For disclosure, I’m long ES and CL….or S&P emini and oil for you non-futures traders. 
I’ll be light on trading Monday as I go golfing at a charity event….so go long golf ball manufacturers.
Thanks for reading and good luck this week!
There was a Whole Lotta Shakin’ Going On today as volatility was chop chop chop! However that doesn’t matter much to computers – oops, I mean traders.
Here’s some weekend reading:
A great site to check sentiment using option puts/calls. ISEE Index
Do The Latest European Bank Lending Numbers Reveal A Major Headache Looming For The ECB? The devil is in the details.
Oh boy! More levereaged ETF’s 
Direxion Planning 11 New Leveraged Currency, Commodity ETFs.
High-Frequency Programmers Revolt Over Pay. Computer jockeys setting up own shops in bids to make millions.
Futures were up overnight and then Initial Claims came out not so bad, so the market was going to have a decent day. Then, St. Louis Fed Prez said we were close to jap-style deflation and the markets broke down! It was a wild ride. It looks like there is a bull snorting in one corner and a bear growling in the other….there’s a fight going on…and no apparent winner…yet.
All the indexes closed barely in the red. But we went up then way down and then fought back to breakeven. The Industrials and Russell are still above their 200ma and the S&P is still below….not much change this week….but it sure hasn’t felt that way!
I was lucky enough to have time to get out of some, but not all, longs at the market open. I tried to hedge with ES but got chopped to bits every time. I finally just quit trying, and by the end of the day, all the positions I had remaining returned to where they started.
On Friday we have lots of numbers coming out: GDP Price Index, Employment Cost Index, Chicago Purchasing Managers Index and University of Michigan Consumer Sentiment. Now, this afternoon I would have thought traders would have stayed away, but volume increased in the afternoon and GS really took off. Do you think GS knows something about those numbers?
The blades have to be getting dull on this chopper. All the indexes ended in the red, off anywhere from a quarter percent to one and a half percent. Volume was extremely low and Advance/decline volumes were barely down two to one.
But which way do we go now? I’m positioned on the long side, so I want the market to go long. Unfortunately, the market never does what I want it to do. So, play the charts. But I can’t tell from the charts. The only play I have is to tighten stops and maybe hedge a bit with TZA BGZ or maybe just S&P futures.
I’ll be listening in on the DRYS conference call on Thursday morning. Earnings came out after the close today and looked good. Now we need some good news…like an IPO or a sale.
Thursday brings us the largest single day of earnings reports of the season. And let’s not forget our weekly headache of Initial Unemployment Claims. Something’s got to move in a confident direction, either up or down….soon, I hope. Good luck tomorrow!
Do you remember the old WWII war movies, or even Hogan’s Heroes, when they disciplined soldiers by threatening to send them to the Russian front? Well, I guess that’s what BP is doing with CEO Hayward…sending him over to the russian front as someone else runs the mothership. 
Today was a sausage-maker…chop, chop, chop. The good thing, it relieved some of that overbought pressure in equities. The bad part…gold and oil got bitch-slapped….hard!
All the indexes closed near breakeven, the Dow in the green and the rest in the red. Not very damaging, but I wouldn’t want to see much more than 10 points shaved off in the SPX…a test of that breakout would be good.
Tomorrow will be wait and see…see what the Durable Goods Orders says in the morning and what the Fed’s Beige Book says in the afternoon. Oh yeah, and in between we’ll see how oil inventories are doing.
Happy trading tomorrow!
We suprisingly had some good homes sales news and FDX boosted its earnings predictions for the fiscal first quarter and the rest of the year! All the indexes closed in the green.
I didn’t think the S&P would get to its 200ma in 1 day, but it did…And the June highs are not that far off. 
The Dow closed above its June highs, while the Russell still has some ground to cover.
We have the House Price Index tomorrow along with consumer confidence. The Stock Trader’s Almanac shows Monday, Thursday and Friday as bullish days. Now that doesn’t mean that’s what will happen, but seasonality does have a vote in this market. But, if you’re a bull, you’ve got to be feeling pretty good!
It was a good week for the bulls, except for Wednesday giving us a spook. We’ve made new July highs in the indexes and are now shooting for the June highs. The Dow Jones Industrials are the closest, sitting between its 200ma and the high.
The Russell 2000 is also already above its 200ma and July highs, but looking to get to its June highs….but that is still some distance to go. 
The S&P 500 looks to be the weakest, still below its 200ma, but its June highs are also close to the 200.
Overall, the charts are bullish.
Last week we hardly had any economic data besides earnings reports. But this week the data picks up along with earnings reports.
Monday, 7/26:
10:00 – New Home Sales
Tuesday, 7/27:
09:00 – Case-Shiller House Price Index
10:00 – Conference Board Consumer Confidence
Wednesday, 7/28:
08:30 – Durable Goods Orders
10:30 – Crude Oil Inventories
14:00 – Beige Book
Thursday, 7/29:
08:30 – Unemployment Claims
Friday, 7/30:
08:30 – Advance GDP Price Index
08:30 – Employment Cost Index
09:45 – Chicago Purchasing Managers Index
09:55 – University of Michigan Consumer Sentiment
And then we’re all done with July! Thanks for reading and good luck tomorrow!
Sometimes, entranced by the screens, watching equities, options and futures change colors, charts moving in a wave, and indicators pointing in every direction, I just have to scream....
