Written by Gary
Closing Market Commentary For 08-23-2013
The sideways market dance continued until 15 minutes before the close when the BTFDers jumped in with abandon shooting the volume sky-high making new highs for the day. Before I could write the BTFDers obituary, the bears that were waiting to pounce, did just that and down came the numbers .
Still, by 4 pm the averages had put their best forward closing 30% to 70% higher. It looks like there are a bunch of sheeples in the market now and some of them got fleeced this afternoon. The $VIX has dropped to 14.03, investor fears are subsiding and the bulls are planning to attack the markets on Monday.
My buy/sell stands at 30% sell and 55% buy on the longer view, but that set of indicators is getting shaky, so I don’t put too much faith in it right now. The shorter term indicators are much different at 60% sell and 10% buy.
An interesting read below, but then I am probably just preaching to the choir.
What are the consequences of a central bank creating trillions of dollars for speculation and a central state borrowing trillions of dollars on a permanent basis?
As noted before, risk cannot be extinguished, it can only be offloaded onto someone else or masked for a short time.
The consequences of this sleight-of-hand (the Fed creates money to buy Federal bonds so the government can borrow and blow trillions of dollars) are not yet visible, but there will be consequences at some point; the risks have only been temporarily cloaked.
Borrowing and printing $10 trillion hasn’t fixed anything; it has only raised the reservoir of risk to the top of the dam.
Cracks are opening as the pressure builds, and we should not be surprised when risk and consequence reconnect and the dam gives way.
Also read this afternoon about my favorite scourge of the trading world; HFT algo computers.
CFTC looks to rein in high-speed trading. The Commodity Futures Trading Commission is completing a road map that aims to rein in high-speed trading (HST) and bring it under increased oversight.
Inter alia, the CFTC is looking at how to prevent algorithms from spinning out of control and causing havoc on the markets. The road map comes amid rising concern that systems are becoming increasingly unstable.
The DOW at 4:00 is at 15010 up 47 or 0.31%.
The SP500 is at 1038 up 2.04 or 0.20%.
SPY is at 166.66 up 0.56 or 0.34%.
The $RUT is at 1038 up 2.04 or -0.20%.
NASDAQ is at 3658 up 19 or 0.52%.
NASDAQ 100 is at 3124 up 22 or 0.72%.
The longer trend is up, the past months trend is bullish, the past 5 sessions have been negative and the current bias is bearish.
WTI oil is trading between 104.32 and 106.90 today. The session bias is bearish and is currently trading down at 106.31.
Brent Crude is trading between 111.20 and 108.76 today. The session bias is sideways with a negative slant and is currently trading up at 110.93.
Gold rose from 1368.42 earlier to 1399.911 and is currently trading down at 1397.10.
Dr. Copper is at 3.346 rising from 3.315 earlier.
The US dollar is trading between 81.69 and 81.25 and is currently trading down at 81.41, the bias is currently sideways with a negative slant.
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Written by Gary