There’s a first time for everything, even for chartists; ‘dips have been canceled’

Brian Shepard
November 22, 2013
Market Recap
Market Recap

Collective Intelligence! WEEKEND EDITION > READ ALL ABOUT IT!  [DJIA] closes above 16,000 two days in a row, the first time in history. READ ALL ABOUT IT!  Will record highs and buying the equities on the dip extend through the Thanksgiving holiday?  Louis Winthorpe III @LWinthorpe @MrTopStep dips have been canceled. just buy.

Today started with 243k ESZ and 500 SPZ traded on Globex, trading range was 1796.75 – 1792.00. Thursday’s regular trading hours (RTH’s), pit session trading range was 1795.30 – 1783.80 before settling at 1793.70 up 14 handles. The overseas markets were mixed following the record close in the Dow even as Germany continues to show signs of economic growth. German IFO checked in at  109.3 vs 107.9, 18 MONTH HIGH.

Today’s open outcry pit session opened a handle higher at 1795.50 – 1794.50, traded an early low of 1792.80 before continuing its slow mechanical grind higher throughout the morning. Trading range through the opening hour was shy of 5 handles, but sat in the green before catching a small bid to trade a new all-time high of 1800.50 at 10:58. The Hawk only seemed to add to the advance ...iceChat (09:32) FED'S GEORGE EXPECTS TAPERING DISCUSSIONS TO BE ON THE TABLE IN DECEMBER - and up up and away. Regarding central bank speakers... yes, it has increase cause if you keep repeating the same nonsense eventually people start to believe in it!!! - FrogMan.

SHOW ME THE MONEY! The only economic data today was the  U.S. JOLTs Job openings (SEP) checked in at 3913 vs exp of 3850 and 3844 prior, overall hiring hit 5yr highs in September. How’s the pay? One thing that has been embedded into our brains is to always follow the money … Speaking of jobs, there are and will be plenty of eyes, including the FOMC, on the jobs data through the November employment data to be released on 12/6.  By the way, there is plenty of economic data out next week, the holiday week, including housing data.

A first for everything! Sam_E  (12:37)  (ES) 3 straight 50000 contract dojis in a row with the same top. i would love to tell you what that means but i have never had that happen on my chart before. Guess there is a first time for everything – I’ve had two but never 3,  8 years worth of charts. FrogMan Sam, what happened last time you had 2? william_blount  1 bar after the other with no separation sam? Sam_E  yep we have 3. william_blount  GUT GUESS----if the bears don’t get it going with an early weak last hour high and we get rid of the cash vs futures divergence then we go to thru those highs.  Sam_E doubles usually break down 73%, but im with bill on this one. although my good friend mr blount may agree that technically we DID just put in a no 5 wave move on this leg to put in this high. Skeptical because wave 4 was flat almost nonexistent but it is what it is. Barry_S Sam, what time frame charts were you looking at where you see the three Dojis? Sam_E i dont use time. 50k contracts.

The afternoon session was a continuation of yesterday and this morning’s rip. Nothing stood out, but the mechanical, algo-induced buy program that ran small buy stops on light volume and those portfolio managers that have to chase performance - Pain Trade! The cash close traded 1802.80 - finish off the week on a new all-time high and the seventh consecutive higher weekly close!.

Warning, open at your own risk!  This is a bit vulgar, but it is pretty funny - unless you are a bear

Jeremy Grantham from GMO, who has predicted many bubbles, said that prudent investors should already be reducing their equity bets and their risk level in general, adding, "This market is already no exception, but speculation can hurt prudence much more and probably will. Ah, that's life. And with a Fed [Federal Reserve] like ours it's probably what we deserve," he added. Barrons article: Jeremy Grantham's Bullish Two-Year Outlook.

Pre-market events: Pending home sales, Dallas Fed manufacturing survey, 2yr note auction and the BOJ minutes are released Monday night.

An oldie … but still holds true >> “Pain trade” a number of fund managers missed out on the rally and as a result are lagging the broader indices. The longer prices stay at present levels, the greater the impetus for managers to “chase” stocks will become. This could cause a virtuous cycle whereby higher prices beget higher prices. *WSJ = 2007

Hilsenrath article out Wednesday