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Post by uncleharley on Dec 27, 2021 22:51:47 GMT
It will probably go on until the New Year is here and traders have returned to their desks. Trading volume continues to be a little light because of the holidays. Beware of light volume rallies. This is a very important point, and I would like to understand it better in order to make it more actionable. SPY volume today was 55m versus 78m on average. Hence, volume today was 70% of normal. Is that really low, or within the normal range of volume figures. To be more exact, what is the SD of SPY trading volume? If 55m shares falls below 78m minus 1SD, then it’s in the bottom 16% of the volume range and I would call that “low.” That is a very good question and I am not sure I can give you a satisfactory answer, however rule #10 in John Murphys Ten Laws of Technical Trading goes as follows; 10. Know the Confirming Signs Don't ignore volume. Volume is a very important confirming indicator. Volume precedes price. It's important to ensure that heavier volume is taking place in the direction of the prevailing trend. In an uptrend, heavier volume should be seen on up days. Rising volume confirms that new money is supporting the prevailing trend. Declining volume is often a warning that the trend is near completion. A solid price uptrend should always be accompanied by rising volume." You can read the whole book at the Chart School on Stockcharts.com. The school is free.
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Post by fritzo489 on Dec 28, 2021 1:43:26 GMT
To my way of thinking, many of the Market ,makers-movers, are enjoying a Christmas vacation. Have a good evening, fritzo489
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Post by oldskeet on Dec 28, 2021 12:42:28 GMT
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Post by oldskeet on Dec 29, 2021 7:35:33 GMT
Hi guys, In checking my stock proxy link above for SPY it seems regular volume for December 28th was only 9,786,245 shares (which is low) while short volume was 7,081,627 shares. Thus short shares was 72.36% of volume. From my perspective ... Big Money has ramped up its short positions in this thinly traded market. Now if the shorts are forced to cover we could have a strong up day. But, if the shorts gain control of the market I wonder where the floor will be? SPY Short Volume ... nakedshortreport.com/company/SPYIn checking the price action through charting of SPY in the Elder Ray System it seems the bulls have been in control since December 20th. If the price line turns bule or red then perhaps its time to cut and run booking some profit. SPY Price Chart (Elder Ray System) ... stockcharts.com/h-sc/ui?s=SPY&p=D&b=5&g=0&id=p20881173280Comment: The CCI reflects that SPY is overbought while there has been a near term moderate inflow of money, MFI ... and, STO reflects that the price action might be peaking. Fear & Greed Index: money.cnn.com/data/fear-and-greed/Comment: With a reading of 54, at neutral, not much greed. Perhaps, as said by some, the FGI is behind the curve much as the FOMC is behind the curve in dealing with inflation. Cathie Wood Trims Large Stake of ARK’s Holdings www.cnbc.com/2021/12/28/cathie-wood-is-still-a-star-but-some-of-the-shine-came-off-this-year.htmlComment: Better to sell into strength at a high water mark than weakness as SPY is at, or near, an all time high. If one is a trader, more so than a buy and hold investor as I am, pehaps now is a good time to cut and run? Time will tell. On the other side of the coin. Fourth quarter earning season starts mid January and earnings are expected to be strong. www.google.com/search?q=S%26P+4th+Quarter+2021+estimated+earnings&client=tablet-android-alco&sourceid=chrome-mobile&ie=UTF-8 So, what is an investor to do? For me, being a long term investor, and not much of a trader, I am doing nothing. I remain invested within the confines of my asset allocation while I await the next stock market swoon before buying, now being a little heavy in cash. And, yes ... my buy list is already made. Ain't investing great?! Old_Skeet
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Post by uncleharley on Dec 29, 2021 13:51:09 GMT
"So, what is an investor to do?"
I am sitting on my hands until trading volume returns to normal or average. That should happen on 1/3/22. At that point I will let the market be my guide for the short term. For the longer term I plan to open a small position in CEF in my IRA. My plan is to add to it as dividends become available. That will be my financial disaster hedge for the long term.
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Post by yogibearbull on Dec 29, 2021 14:11:37 GMT
M* Quote page for Cathie Wood's ARKK is showing notable outflows/redemptions around mid-2021.
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Post by Fearchar on Dec 29, 2021 14:27:30 GMT
uncleharley, Right now the F&G index is neutral. So, no really strong feelings or actions warranted either way. Future Market action will be driven by significant news developments more than anything. Earnings do though continue to trend higher, which isn't a factor in the F&G index, but long term is what drives the equity markets. A good investor really needs to decide how much they are an investor versus how much they are a trader/speculator. Despite all the media attention that they attract, Trader & Speculators have lousy long term records. I admit it can be entertaining, but so is betting on the horses or a little ball spinning on a roulette wheel. Investing involves the long term assumption of risk. I understand everybody has their opinion on what's best to do. However, at the same time, it strikes me as odd that so many intelligent people are unable to reach a consensus.
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Post by FD1000 on Dec 29, 2021 14:39:56 GMT
Hi guys, In checking my stock proxy link above for SPY it seems regular volume for December 28th was only 9,786,245 shares (which is low) while short volume was 7,081,627 shares. Thus short shares was 72.36% of volume. From my perspective ... Big Money has ramped up its short positions in this thinly traded market. Now if the shorts are forced to cover we could have a strong up day. But, if the shorts gain control of the market I wonder where the floor will be? SPY Short Volume ... nakedshortreport.com/company/SPYIn checking the price action through charting of SPY in the Elder Ray System it seems the bulls have been in control since December 20th. If the price line turns bule or red then perhaps its time to cut and run booking some profit. FD: the bulls are in control since 04/2020SPY Price Chart (Elder Ray System) ... stockcharts.com/h-sc/ui?s=SPY&p=D&b=5&g=0&id=p20881173280Comment: The CCI reflects that SPY is overbought while there has been a near term moderate inflow of money, MFI ... and, STO reflects that the price action might be peaking. FD: this indicator doesn't tell what is going to happen next.Fear & Greed Index: money.cnn.com/data/fear-and-greed/Comment: With a reading of 54, at neutral, not much greed. Perhaps, as said by some, the FGI is behind the curve much as the FOMC is behind the curve in dealing with inflation. FD: this indicator doesn't tell what is going to happen next.Cathie Wood Trims Large Stake of ARK’s Holdings www.cnbc.com/2021/12/28/cathie-wood-is-still-a-star-but-some-of-the-shine-came-off-this-year.htmlComment: Better to sell into strength at a high water mark than weakness as SPY is at, or near, an all time high. FD: Cathy wood had a terrible year in 2021, while the "stupid" index SP500 is up 29.9%, ARKK is down -23.2%. Her funds are very high risk/reward and should be in your portfolio explore portion. The bigger the fund, the harder it gets. If one is a trader, more so than a buy and hold investor as I am, pehaps now is a good time to cut and run? Time will tell. FD: I'm a trader and invested at 99+%. This year, there wasn't a time when risk was elevated enough to sell and believe me, when the time arrives I will be in plenty of cash.
On the other side of the coin. Fourth quarter earning season starts mid January and earnings are expected to be strong. www.google.com/search?q=S%26P+4th+Quarter+2021+estimated+earnings&client=tablet-android-alco&sourceid=chrome-mobile&ie=UTF-8 FD: SP500 performance doesn't reflect short term(weeks) and even longer term(months) the earnings and how big they were. Markets many times reflect what the future look like and sometimes where the markets were. Example one: in 2000, earning were down sharply but the SP500 was up a lot more than the LT average. Example two: in 2018 earning were up but the SP500 was down -4.5. See table belowSo, what is an investor to do? For me, being a long term investor, and not much of a trader, I am doing nothing. I remain invested within the confines of my asset allocation while I await the next stock market swoon before buying, now being a little heavy in cash. And, yes ... my buy list is already made. Ain't investing great?! Old_Skeet What to do? Most should just be invested all the time at 100% based on their goals with minimal changes and keep their asset allocation. This is especially true for accumulators. If you want to change your portfolio AA, don't go to more cash, instead change your AA. Easy example using one fund: suppose you own only VWELX (60-65% stocks, the rest is bonds), replace it with VWIAX (35-40% stocks, the rest is bonds). This way you are in the market but just lower the volatility. Suppose you have a list, no problem, when your fund is lagging, switch to the other fund. Markets are not predictable, while you wait out in cash for the next meltdown, the market could easily be up 10% Traders should stay in the market most times and only be out to cash when markets are at very high risk. I have been in 95% of the time invested at 99+%. Traders should also examine their portfolio LT risk-adjusted performance against mostly buy and hold portfolio, as I described above. Attachments:
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Post by jongaltiii on Dec 29, 2021 14:41:11 GMT
M* Quote page for Cathie Wood's ARKK is showing notable outflows/redemptions around mid-2021. Was listening to a program yesterday that was discussing ARKK ... the financial commentators had this to say (Note: I'm paraphrasing/ my comments in Italics) * They mentioned the outflows from ARKK in 2021 and they said despite a good chunk of outflow in mid 2021, the fund is actually very resilient. After being down 20%, the fund has kept 75% of its holders. It's actually down 13% for the year as of yesterday but given SPY is up 26% - its remarkable the outflows haven't been larger IMO. She has some loyalists for certain. * The other point they made was that the companies she buys, while many are not yet profitable, they are transformational companies. These are companies that have the ability to make a huge impact in the next 5 years. If you listen to Cathie, she says she's buying for 5-6 years and not short-term. One example is Teladoc. I think that's a fair point and she clearly won with an early bet on TESLA.
Just noted the CNBC link that oldskeet linked and this story does a better job explaining what I tried to summarize above. www.cnbc.com/2021/12/28/cathie-wood-is-still-a-star-but-some-of-the-shine-came-off-this-year.htmlAttachments:
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Post by oldskeet on Dec 29, 2021 14:43:10 GMT
Hi all,
As a reminder it is the different perspectives and strategies that make up the market. So, for every seller there has to be a buyer and for every buyer there has to be a seller. Price helps to determine volume as much as anything else. Fact: Prices are now high and volume is thin plus many traders are on holiday.
Old_Skeet
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Post by FD1000 on Dec 29, 2021 14:52:39 GMT
Hi all, As a reminder it is the different perspectives and strategies that make up the market. So, for every seller there has to be a buyer and for every buyer there has to be a seller. Price helps to determine volume as much as anything else. Fact: Prices are now high and volume is thin plus many traders are on holiday. Old_Skeet high-low volume for the SP500 doesn't reflect performance. I can show many times when volume was flat-down and the market goes up. While volume is a better indicator for single stocks, it's not for the SP500. I do agree the price is one of the best indicator, regardless of anything else. I never argue with markets. I only buy and stay in a fund with an uptrend Attachments:
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Post by Chahta on Dec 29, 2021 18:17:12 GMT
M* Quote page for Cathie Wood's ARKK is showing notable outflows/redemptions around mid-2021. I notice she gets a lot of press for some reason.
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Post by retiredat48 on Dec 29, 2021 20:06:26 GMT
Hi all, As a reminder it is the different perspectives and strategies that make up the market. So, for every seller there has to be a buyer and for every buyer there has to be a seller. Price helps to determine volume as much as anything else. Fact: Prices are now high and volume is thin plus many traders are on holiday. Old_Skeet Ah, but Old-Skeet, every seller is not necessarily a "willing seller." A margin call, for example, is unwilling. C Woods funds are ETFs, and if net fund outflows occur, some underlying stocks must be sold promptly by her. This is a feature (flaw) of ETFs that one should realize/respect when owning them. A downdraft can feed upon itself, real time. R48
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Post by anitya on Dec 30, 2021 3:29:52 GMT
M* Quote page for Cathie Wood's ARKK is showing notable outflows/redemptions around mid-2021. She never fails to remind listeners that she has a 5-6 year investing horizon for each of the companies she invests in. Perhaps, an indirect dig at other active managers who by and large do not tolerate dogs. However, when I look at M* portfolio page for her funds they have high turnover that is not explained by outflows / redemptions in 2021. Given that she discloses all her trades within 24 hours, how is she able to make the claim that she buys to hold for 5-6 years? P.S.: I am not averse to high turnover. In fact, I avoid active funds with very low turnover - there are quite a few of them.
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Post by oldskeet on Dec 30, 2021 12:08:33 GMT
Hi guys, uncleharley, fritzo489, oldskeet, yogibearbull, Fearchar, FD1000, jongaltiii, Chahta, retiredat48, anitya, Thanks for making comment. Seems, each of us has a spin of our own. And, that is my underlining point. It is the many perspectives and strategies that make the market. I wish all of you the very best in the coming new year ... and, most of all ... "Good Investing." Old_Skeet
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Post by Fearchar on Jan 20, 2022 18:00:45 GMT
The Market is now in the "Greed" range. Current Reading is 60.
Put/Call Options 69.65%: Extreme Greed Stock Price Breadth 2.33%: Extreme Greed Junk Bond Demand 1.70%: Extreme Greed Safe Haven Demand 1.82%: Neutral Market Volatility 21.93: Neutral Stock Price Strength ~2.5%: Fear Market Momentum 0: Extreme Fear
Very interesting market conditions.
Basically, Market Momentum is masking Extreme Greed by several other metrics.
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Post by uncleharley on Jan 21, 2022 17:15:37 GMT
How many people on this forum believe that the Fed will increase the discount rate while the stock market is plunging???
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Post by fishingrod on Jan 21, 2022 17:21:20 GMT
one vote for yes here.
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Post by Fearchar on Jan 21, 2022 17:28:57 GMT
Yes; for sure they will raise rates 3 or 4 times this year.
Question is will they all be 0.25% steps?
They may start with 0.5% in March.
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Post by Deleted on Jan 21, 2022 17:29:25 GMT
Yes, I do!
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Post by richardsok on Jan 21, 2022 17:33:38 GMT
Good question, har. I try not to have such opinions but it is difficult to imagine the Fed doing nothing. (Doing too little is a real possibility.) But I vote they'll raise.
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Post by steelpony10 on Jan 21, 2022 17:38:48 GMT
How many people on this forum believe that the Fed will increase the discount rate while the stock market is plunging??? It may be “plunging” because of an unknown series of rate increases. Not a series of earnings misses. The economy should (will) slow. See who hits or exceeds their target. Netflix apparently is out. Bottom line inflation is still there until world economies recover and settle down and all demands for goods and services are filled. There’s a lot of good news out there worldwide if you leave out China. So “damn the torpedos…..”
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Post by oldskeet on Jan 21, 2022 17:43:53 GMT
uncleharley , In answer to your question. "How many people on this forum believe that the Fed will increase the discount rate while the stock market is plunging???" I believe they will. At first, they said inflation was transitory. Seems, the FOMC has made yet another error. Companies fire people who are often error prone. They simply could not continue with their false talk as it was very obvious inflation was not transitory. Generally, people get fired that are often error prone. But, wait. This is the government. Old_Skeet
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Post by fritzo489 on Jan 21, 2022 18:08:58 GMT
oldskeet, Greetings ; Have you been doing any dipping ? I put in a small dip on a GP fund two days back. I'll be looking elsewhere today for a little dip buying. Stay warm, fritzo489
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Post by Capital on Jan 21, 2022 18:47:07 GMT
How many people on this forum believe that the Fed will increase the discount rate while the stock market is plunging??? uncleharley, I think that the FED will increase rates. Market be damn.
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Post by win1177 on Jan 21, 2022 18:54:43 GMT
How many people on this forum believe that the Fed will increase the discount rate while the stock market is plunging??? I believe they will, the Fed is a little “behind the eight ball “ with all the stimulus, they really have few other options to tame inflation. Win
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Post by Deleted on Jan 21, 2022 19:21:41 GMT
A column in the WSJ (last week?) made the point that ARK funds have gotten so big that they can't trade without influencing prices - a double whammy when they face redemptions. More importantly, much of the money in the funds was invested after the initial returns had been earned. Thus even though the fund has a great record, the average investor lost money.
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Post by gman57 on Jan 21, 2022 20:27:29 GMT
How many people on this forum believe that the Fed will increase the discount rate while the stock market is plunging??? I believe they will, the Fed is a little “behind the eight ball “ with all the stimulus, they really have few other options to tame inflation. Win Agree but if the market continues to go down that does some of the fed's work for them. People feeling less rich tend to not spend as much... bye bye inflation. So maybe not as many hikes this year depending on market performance.
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Post by uncleharley on Jan 21, 2022 20:37:08 GMT
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Post by richardsok on Jan 21, 2022 20:54:40 GMT
A column in the WSJ (last week?) made the point that ARK funds have gotten so big that they can't trade without influencing prices - a double whammy when they face redemptions. More importantly, much of the money in the funds was invested after the initial returns had been earned. Thus even though the fund has a great record, the average investor lost money. A couple of months ago I posted an article Michael Burry was shorting the ARKs while Cathie W was pumping them and I remarked it would be interesting to see how these two heavyweights would make out. Looks like Burry won.
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