Serious manipulation

[jonnyfrank]

How can the big time market manipulation be explained? First, the days starts out with a downtrend in the 10 year rate, which subsequently explodes upward and is now approach 4%. Secondly, the creepy flatline movement of the Dow and Nasdaq. This is very odd and it all seems very, very contrived.

[Yodean]

How can the big time market manipulation be explained? First, the days starts out with a downtrend in the 10 year rate, which subsequently explodes upward and is now approach 4%. Secondly, the creepy flatline movement of the Dow and Nasdaq. This is very odd and it all seems very, very contrived.

Yep.

The last 75 minutes of trading activity is very interesting ... it's what I focus on these days.

Lol, Nas just flipped +ve, now S&P ... Nas lead, baby!

[jonnyfrank]

As the 10 year rate goes, so goes the markets. What is interesting is that the rate actually has more impact on the Dow than the Nasdaq. Perhaps the slaughter won't end until we get to the 4.25-4.5% 10 year rate. That is the "trend" I am seeing right now. Of course, if there is a reversal it might be in anticipation of the 4.5%. If you watch the live 10 year rate you will see how it directly impacts the markets right now, right down to the second. If the rates held steady this am instead of rocketing up we coulda shoulda woulda had a positive market day. Let's see what happens in the last 30 minutes....maybe the markets will give the 10 year rate the bird and fly up.

[Yodean]

As the 10 year rate goes, so goes the markets. What is interesting is that the rate actually has more impact on the Dow than the Nasdaq. Perhaps the slaughter won't end until we get to the 4.25-4.5% 10 year rate. That is the "trend" I am seeing right now. Of course, if there is a reversal it might be in anticipation of the 4.5%. If you watch the live 10 year rate you will see how it directly impacts the markets right now, right down to the second. If the rates held steady this am instead of rocketing up we coulda shoulda woulda had a positive market day. Let's see what happens in the last 30 minutes....maybe the markets will give the 10 year rate the bird and fly up.

Yeh, very important. The USD has to stop going up for bonds to have a sustained rally. Right now, cuz of USD shortage, lots of bonds being sold everywhere.

It's a bloodbath ... Treasury illiquidity is reaching late 2018 levels or so, when Fed pivoted back then. But JP ain't doing that this time ... so we'll have to hope USD stops rising.

My line in the sand is a weekly close of USD above 115; if it does that, I think we're going to 120+ and equity/bond markets are screwed.

[jonnyfrank]

Y, my dad always told me "hope" was not a plan, lol. But in this market and its manipulations, there is a need for something. It is funny how one can gain, get a zero (neither gain or loss), or lose when it comes to the markets. When you think about it, those are decent odds for not losing, so how the heck does losing happen!!!! Life ain't fair.

[Yodean]

Life ain't fair.

Yep, I was taught this at an early age. Or you could say that we're lucky in the sense that at least we have some $$$ to play in the casino known as the markets.

Here are a few charts to cheer you up (yeh, I'm a bit of an eternal bull - the real bottom prolly won't be in until I start shorting the indices for real, i.e. not as a hedge):





*****

The ROAR is about to start ... date to be determined. Rally Of All Rallies.

[Yodean]

Lol, I was in the middle of commenting on one of Harry's posts about recent UK/BOE moves, but Harry's post disappeared - guess he erased it?

It was about "balance of payments" problems that many countries are facing. Pretty interesting stuff.

Lyn Alden explains it well, imo:

If a highly-indebted developed market does not print money while in the midst of an energy crisis, then it risks having an emerging market style balance of payments problem (widespread nominal default, including the potential for sovereign default).

If a highly-indebted developed market prints money while in the midst of an energy crisis, then it risks having an emerging market style balance of payments problem (currency way down and bond yields way up simultaneously).

*****

Could also be viewed as yet another manifestation of the USD Milkshake/Black Hole Theory. Coming to a country near you ... (outside USA).

[harryg]

Lol, I was in the middle of commenting on one of Harry's posts about recent UK/BOE moves, but Harry's post disappeared - guess he erased it?

Ha, was going to add some detail, but you beat me to it...

Y, my dad always told me "hope" was not a plan, lol.

"This is a fundamental balance of payments crisis, with politicians hoping it will eventually just calm down. Hope is not a strategy, and markets are reflecting that."

Recent comment from Nomura on UK government.

[LoriPrecisely]

*****

The ROAR is about to start ... date to be determined. Rally Of All Rallies.

I was just reading a summary of a book I am planning to buy,
"Secrets for Profiting in Bull and Bear Markets" by Sam Weinstein,
which touches on this same topic.
Buying/Selling patterns
4 Year presidential cycle: first year-bear, second year-bear until midway then bullish, third year-mostly bullish, fourth year- choppy...usually first half weak, then strong
Months: Bullish: Nov-Jan, April. Bearish: Feb, May, June, September
Day of week: Monday worse, Friday strongest.
Day preceding holidays usually bullish.

[Yodean]

I was just reading a summary of a book I am planning to buy,
"Secrets for Profiting in Bull and Bear Markets" by Sam Weinstein,
which touches on this same topic.
Buying/Selling patterns
4 Year presidential cycle: first year-bear, second year-bear until midway then bullish, third year-mostly bullish, fourth year- choppy...usually first half weak, then strong
Months: Bullish: Nov-Jan, April. Bearish: Feb, May, June, September
Day of week: Monday worse, Friday strongest.
Day preceding holidays usually bullish.

I dunno too much about Weinstein - heard a bit about him somewhere, mostly negative, tbh - but as a general rule, I stay away from anything that has "Secrets to ..." in its title/slogan.

E.g. "Secrets to becoming rich," "Secrets to becoming a Ninjedi" (I'm currently writing this one), "Secrets to finding your soulmate and living happily ever after" etc.

If you're really interested in books on investing, besides _The Zurich Axioms_, I heard the 1st three books in the "Market Wizards" series are quite good.

https://www.bing.com/search?q=market+wi ... ab4ae13259

[LoriPrecisely]

"Secrets to becoming a Ninjedi" (I'm currently writing this one), "Secrets to finding your soulmate and living happily ever after" etc.

If you're really interested in books on investing, besides _The Zurich Axioms_, I heard the 1st three books in the "Market Wizards" series are quite good.

https://www.bing.com/search?q=market+wi ... ab4ae13259

Can't wait for your book to be published.

Thank you for the recommendations, I will look at those today.

I am currently reading a book called, "Option Think" by Thomas Moore

[harryg]

Weinstein's book is quite good. He talks about different stages of market behaviour. He uses 30 week MA for that as I recall.

Trading breakouts, using stops and so on. Also talks about relative strength (not RSI), and, as you mentioned, the Presidential Cycle. Strong sectors, strong stocks in those sectors...

I find it useful to re-read these types of books - we can sometimes get bogged down in esoteric nonsense and forget the basics.

[LoriPrecisely]

Weinstein's book is quite good. He talks about different stages of market behaviour. He uses 30 week MA for that as I recall.

Trading breakouts, using stops and so on. Also talks about relative strength (not RSI), and, as you mentioned, the Presidential Cycle. Strong sectors, strong stocks in those sectors...

I find it useful to re-read these types of books - we can sometimes get bogged down in esoteric nonsense and forget the basics.

Here are a few highlights from a summary of the book:
•Know where protective stop will be (ALWAYS use it) set before entering the order – if it’s too far away, look for other stock or wait to purchase when safer level forms
•Never sell a stock in Stages 1 or (especially) 2, AND never buy a stock in Stages 3 or (especially) 4 – stage analysis can be applied to any investments that are governed by supply and demand
•Always be in harmony with the market – buy Stage 2 strength; sell Stage 4 weakness

Stage 1: basing area. After several months decline, start sideways trend. Volume lessens (often starts expanding towards end stage 1). 30 week MA begins to flatten out.
Stage 2: advancing phase. Ideal time to go long when stock swinging out of its base into this more dynamic stage. Breakout above resistance zone and 30-week MA should occur on impressive volume. Usually after initial rally at least one pullback (the less the pullback the stronger the stock).
30 week MA usually starts moving up shortly after breakout. Expect price to move two steps forward and one sharp step back – ok as long as above 30-week MA.
When angle of ascent of MA slows down considerably and prices closer and closer to MA, stock becomes a hold.
Stage 3: top area. Upward advance loses momentum and stock starts trending sideways. Volume usually heavy and moves sharp and choppy. Price tiptoes below and above MA on declines and rallies. Keep emotions in check.
Stage 4: declining phase. Stock breaks below bottom of support zone.

To increase probability of success when trading options
1. Buy a call option only on a stock that is in Stage 2 or is moving into Stage 2. Buy a put option only on a stock that is in Stage 4 or is first entering that phase
2. Buy only an option that has big potential – you are going to be wrong more often with options than with stocks. Selectivity is absolutely crucial!
3. Give a reasonable amount of time before expiration – 40/50 days to 3 months
4. Buy an option that is close to the striking price and, if possible, in the money. Or if it’s out-of-the money, make sure it’s very close to the striking price.
5. Use a very tight protective stop (mental) on option positions – any sign of weakness is a reason to say goodbye to a position

[MarkD]

Weinstein is a good book. I have read literally hundreds, most crap. He is straightforward and easy to follow. One issue is too tight stops if Sol is correct regarding future price volatility. And I found other breadth indicators to be more reliable but those he uses are fine. In his day, it was probably fine to use widely published stuff but options activity and dark pools now provide additional data to consider. I also monitor bonds and commodities (principally gold and oil) plus US dollar behaviour (Forex).

Another issue is the magnitude of gains is capped by waiting for the 30ma.

My other favorites are volume, none of which he would have used back in the day. Volume by price, Volume weighted moving average, peak energy volume. And bollinger bands. Tons of stuff on the internet (YT is very good source) to learn how these work with price.

But none of it matters without the key component of psychology or sentiment.

[LoriPrecisely]

Weinstein is a good book. I have read literally hundreds, most crap. He is straightforward and easy to follow. One issue is too tight stops if Sol is correct regarding future price volatility. And I found other breadth indicators to be more reliable but those he uses are fine. In his day, it was probably fine to use widely published stuff but options activity and dark pools now provide additional data to consider. I also monitor bonds and commodities (principally gold and oil) plus US dollar behaviour (Forex).

Another issue is the magnitude of gains is capped by waiting for the 30ma.

My other favorites are volume, none of which he would have used back in the day. Volume by price, Volume weighted moving average, peak energy volume. And bollinger bands. Tons of stuff on the internet (YT is very good source) to learn how these work with price.

But none of it matters without the key component of psychology or sentiment.

Thank you, Mark. I will add this to my notes.
The technical indicators are above my head right now, but I am trying to learn.
Even though I set up volume, volume by price, sma(20), and bollinger bands on my platform, they don't tell me anything. I still feel like it is all a guess.
I do like the 5 minute chart. I feel like I could trade that eventually.
I have been trying to decide a percent of a profit I would be good with selling my shares, especially with Sol saying we should sell at some point.
Personally, I am beginning to think I would prefer to hold most of my shares and sell covered calls against them and just weather any future drop in the market. The market has dropped so much already, I might as well just hold and do more with options.