Until the Naz breaks, its just going to pull everything higher.
While you might get temporary divergence in the DOW, or even
an SRS trade would need to be a scalp.
I know it doesn't seem "right", but that's how it is.
Skipping the High-Wire Act
By
Rev Shark RealMoney.com Contributor 7/22/2009 12:33 PM EDT
Until this
market corrects or consolidates a bit, I have little desire to do
much buying. You certainly can't fault the positive action, but
when we are up 11 days in a row and
Tupperware and
Sybase making parabolic moves, it is a
high-wire act and I'm just not going to play it.
After the move
we have already had there still is no shortage of big moves like
those in
Starbucks ,
Pfizer (,
Charlotte Russe,
Onyx Pharmaceuticals ,
Atheros Communications ,
Gentex and a number of others.
I've started building up a little
ProShares UltraShort Russell 2000 (
TWM -
commentary-
Trade
Now) as a way to short small-caps, but until we see more
weakness I'm not going to press it very hard. I don't like fighting
momentum but the number of stocks that are extended or overbought
appear to be at very high levels.
I sure can't find much I want to buy at this point, which isn't a
great reason to short but I'm going to dip a toe on it on the dark
side.
I bought some TBT right at the close. Hard for me to
believe long rates will stay this low with the perception the
economy and the market are heating up.
I shorted ETN yesterday morning and again this morning,
successfully. They "beat expectations", but won't make $2
this year after making $6 last year. Basically, same story
with CAT today.
Now, all day long I'm hearing, "boy if they can make this much
money with such low sales they'll make tons next year when things
turn".
Anyway, that's the spin, and it probably will work.
7/21/2009 3:11 PM EDT Per the recent post about commercial real estate, based
on what I've been seeing the pain is just getting started. It will
take several years to fix the mess, and it is mostly still way too
early to buy in this sector. However, I am not so negative on large
cap REITs. They have mostly fixed their balance sheets, have strong
management, good quality properties, and reasonable valuations
compared with private commercial real estate. They should be
winners during the correction process.
What's holding the CME REITS up? I believe its simple.
Everyone knows the real issue involves the concern over
ability to roll over debt. I believe "the market" thinks that
if push comes to shove, the Feds will come in and somehow provide
support.
Will they? I think probably not, but its certainly a
possibility.
Also, corporate bonds continue to do well. Some of these
REITS that certainly could not have rolled debt a couple of months
ago will probably be able to if the recent (3month) trends
continues.
Personally, I don't think its all going to be OK. But
things have improved every month since March.
7/21/2009 2:05 PM EDT The recent Moodys report on commercial real estate makes
me look like Little Sally Sunshine. Moody's uses a red green yellow
rating system for tracking various sectors of the commercial market
and for the first time ever none of them were green. Hotels had the
lowest possible rating recording sector scores of zero. RevPar
rates for the group were below the baseline by the largest amount
ever. Industrial was firmly in the red zone while the lone green
from the prior report, multifamily homes, slipped into yellow
status They also said that any improvement for the commercial
market is unlikely for several quarters.
Prices for commercial property are down 34% in total from the highs
of October 2007. The decline appears to be accelerating with a 7.65
decline in May after an 8% drop in April.
There is no way to put a pretty spin in these numbers. There are
billions in commercial real estate loans that need to be refinanced
and are going to spiral as prices continue to fall.
July 21 (Bloomberg) --
General
Electric Capital Corp. bonds were cut to “underweight”
because the finance company’s $6.6 billion of reserves to protect
against losses on its loans are “inadequate” compared with large
banks such as
JPMorgan
Chase & Co. and
Citigroup
Inc, Barclays Capital said.
Earnings reports continue to show good bottom-line results relative
to expectations due primarily to massive cost-cutting, but revenue
growth has been anemic at best. The market doesn't much care right
now, and as long as the bottom-line number beats analysts'
expectations we are seeing positive results. Even stocks that have
run up quite a bit the past week such as CAT are jumping on their
numbers. One exception is TXN, which had a solid report but is
seeing a "sell the news" reaction after running straight up since
the
Intel(
INTC -
commentary -
Trade
Now) report last week.
The market has had a remarkable move over the past week, with an
almost parabolic rise. A lot of folks like those on
CNBC's "Fast Money" are giddy with delight, but for market
players looking to make new buys, this market presents quite a
dilemma. Obviously we have very strong momentum, as we have been
going straight up, but that produces extended and overbought charts
that don't invite good entries. In addition, with more major
earnings reports, the potential for a "sell the news" reaction is
increased. It is going to be particularly interesting to see how
AAPL reacts tonight. Expectations are extremely high and the stock
has moved up from about $136 to $153 over the past week as everyone
is looking for blowout numbers.
So do we take our idle cash and dive into this market that has gone
straight up for nine days in a row now? Maybe if we can find stocks
that aren't too extended already. There are some, but they are
tough to find and if they have been lagging the market, you have to
wonder if there is a reason for it.
Even if you are unwilling to pay up for some of these stocks that
have made big moves, that doesn't mean you should be unduly bearish
or aggressively shorting. One of the keys to success in the market
is to not fight the prevailing trend. Markets that are trending
strongly don't quickly or easily reverse. There is always a big
group of folks who have been left behind who are anxious to jump in
on slight pullbacks. That underlying support will only go away
after the market has struggled for a bit and stops making major
gains.
The important thing now is to not get sucked into the euphoria
after the market has already made its move -- don't throw caution
to the wind. If you are going to make some buys, then stay
disciplined and don't just grab something because you are
frustrated with not being more heavily invested over the past
week.
With AAPL earnings tonight and Ben Bernanke testifying before
Congress today, the market is likely to hold steady. With the
number of extended stocks out there, though, new buys are going to
be very difficult.
The Naz and NYSE volumes from Rev's site don't look THAT low to
me....http://www.sharkinvesting.com/volume.aspx I'm surpised
the SPY is that low. interesting.
The community is delayed by three days for non registered users.
Futures Off
Posted by kurzweg on 23rd of Jul 2009 at 05:10 pm
Haven't seen the details
Posted by kurzweg on 23rd of Jul 2009 at 05:06 pm
but hearing big misses by Capital One, Broadcom and Netflix. "Zero for 7 After Hours" was mentioned.
Tough, tough day tomorrow.
Well, that should end the rally
Posted by kurzweg on 23rd of Jul 2009 at 04:57 pm
CNBC just announced tonight they are having a 2 hour special on "The Summer Rally"
WAY WAY off topic
Posted by kurzweg on 23rd of Jul 2009 at 04:32 pm
AMZN
AMZN MSFT AXP
Posted by kurzweg on 23rd of Jul 2009 at 04:28 pm
trading AH $9 off it's close.
AMZN MSFT AXP
Posted by kurzweg on 23rd of Jul 2009 at 04:24 pm
All released earnings AH and crapped themselves.
do they have the audacity
Posted by kurzweg on 22nd of Jul 2009 at 03:45 pm
to actually end it all Green today?
my non-technical thoughts
Posted by kurzweg on 22nd of Jul 2009 at 02:32 pm
Until the Naz breaks, its just going to pull everything higher. While you might get temporary divergence in the DOW, or even an SRS trade would need to be a scalp.
I know it doesn't seem "right", but that's how it is.
Rev sounds frustrated also
Posted by kurzweg on 22nd of Jul 2009 at 12:49 pm
Skipping the High-Wire Act
By Rev Shark
RealMoney.com Contributor
7/22/2009 12:33 PM EDT
Until this market corrects or consolidates a bit, I have little desire to do much buying. You certainly can't fault the positive action, but when we are up 11 days in a row and Tupperware and Sybase making parabolic moves, it is a high-wire act and I'm just not going to play it.
After the move we have already had there still is no shortage of big moves like those in Starbucks , Pfizer (, Charlotte Russe, Onyx Pharmaceuticals , Atheros Communications , Gentex and a number of others.
I've started building up a little ProShares UltraShort Russell 2000 ( TWM - commentary- Trade Now) as a way to short small-caps, but until we see more weakness I'm not going to press it very hard. I don't like fighting momentum but the number of stocks that are extended or overbought appear to be at very high levels.
I sure can't find much I want to buy at this point, which isn't a great reason to short but I'm going to dip a toe on it on the dark side.
TBT
Posted by kurzweg on 21st of Jul 2009 at 05:08 pm
I bought some TBT right at the close. Hard for me to believe long rates will stay this low with the perception the economy and the market are heating up.
the new Mantra
Posted by kurzweg on 21st of Jul 2009 at 04:21 pm
I shorted ETN yesterday morning and again this morning, successfully. They "beat expectations", but won't make $2 this year after making $6 last year. Basically, same story with CAT today.
Now, all day long I'm hearing, "boy if they can make this much money with such low sales they'll make tons next year when things turn".
Anyway, that's the spin, and it probably will work.
SRS - an alternative view (RealMoney)
Posted by kurzweg on 21st of Jul 2009 at 03:52 pm
it just won't quit
60 period stochastics looks like it is having trouble getting ...
Posted by kurzweg on 21st of Jul 2009 at 03:43 pm
my screen ain't showing a late day sell off.
Commercial Real Estate
SRS implications (RealMoney article)
Posted by kurzweg on 21st of Jul 2009 at 03:34 pm
What's holding the CME REITS up? I believe its simple. Everyone knows the real issue involves the concern over ability to roll over debt. I believe "the market" thinks that if push comes to shove, the Feds will come in and somehow provide support.
Will they? I think probably not, but its certainly a possibility.
Also, corporate bonds continue to do well. Some of these REITS that certainly could not have rolled debt a couple of months ago will probably be able to if the recent (3month) trends continues.
Personally, I don't think its all going to be OK. But things have improved every month since March.
SRS implications (RealMoney article)
Posted by kurzweg on 21st of Jul 2009 at 02:22 pm
Prices for commercial property are down 34% in total from the highs of October 2007. The decline appears to be accelerating with a 7.65 decline in May after an 8% drop in April.
There is no way to put a pretty spin in these numbers. There are billions in commercial real estate loans that need to be refinanced and are going to spiral as prices continue to fall.
Shocking, that I haven't heard about this on CNBC today!
Posted by kurzweg on 21st of Jul 2009 at 02:10 pm
July 21 (Bloomberg) -- General Electric Capital Corp. bonds were cut to “underweight” because the finance company’s $6.6 billion of reserves to protect against losses on its loans are “inadequate” compared with large banks such as JPMorgan Chase & Co. and Citigroup Inc, Barclays Capital said.
Rev Shark -
Posted by kurzweg on 21st of Jul 2009 at 09:19 am
Avoid Euphoria and Undue Pessimism Alike
By Rev Shark
RealMoney.com Contributor
7/21/2009 9:11 AM EDT
The Nasdaq has been up nine days in a row for the first time in about 10 years. With a highly anticipated positive earnings report from Apple( AAPL - commentary - Trade Now) tonight and some good earnings from Caterpillar ( CAT - commentary - Trade Now), Freeport-McMoRan ( FCX - commentary - Trade Now), Coke ( KO - commentary - Trade Now) and Texas Instruments ( TXN - commentary - Trade Now) this morning, the quest for a 10th day of gains is off to a good start.
Earnings reports continue to show good bottom-line results relative to expectations due primarily to massive cost-cutting, but revenue growth has been anemic at best. The market doesn't much care right now, and as long as the bottom-line number beats analysts' expectations we are seeing positive results. Even stocks that have run up quite a bit the past week such as CAT are jumping on their numbers. One exception is TXN, which had a solid report but is seeing a "sell the news" reaction after running straight up since the Intel( INTC - commentary - Trade Now) report last week.
The market has had a remarkable move over the past week, with an almost parabolic rise. A lot of folks like those on CNBC's "Fast Money" are giddy with delight, but for market players looking to make new buys, this market presents quite a dilemma. Obviously we have very strong momentum, as we have been going straight up, but that produces extended and overbought charts that don't invite good entries. In addition, with more major earnings reports, the potential for a "sell the news" reaction is increased. It is going to be particularly interesting to see how AAPL reacts tonight. Expectations are extremely high and the stock has moved up from about $136 to $153 over the past week as everyone is looking for blowout numbers.
So do we take our idle cash and dive into this market that has gone straight up for nine days in a row now? Maybe if we can find stocks that aren't too extended already. There are some, but they are tough to find and if they have been lagging the market, you have to wonder if there is a reason for it.
Even if you are unwilling to pay up for some of these stocks that have made big moves, that doesn't mean you should be unduly bearish or aggressively shorting. One of the keys to success in the market is to not fight the prevailing trend. Markets that are trending strongly don't quickly or easily reverse. There is always a big group of folks who have been left behind who are anxious to jump in on slight pullbacks. That underlying support will only go away after the market has struggled for a bit and stops making major gains.
The important thing now is to not get sucked into the euphoria after the market has already made its move -- don't throw caution to the wind. If you are going to make some buys, then stay disciplined and don't just grab something because you are frustrated with not being more heavily invested over the past week.
With AAPL earnings tonight and Ben Bernanke testifying before Congress today, the market is likely to hold steady. With the number of extended stocks out there, though, new buys are going to be very difficult.
No positions.
TI beats
Posted by kurzweg on 20th of Jul 2009 at 04:35 pm
by .02 and beat on Sales
volume
Volume....PATHETIC
Posted by kurzweg on 20th of Jul 2009 at 04:34 pm
The Naz and NYSE volumes from Rev's site don't look THAT low to me....http://www.sharkinvesting.com/volume.aspx I'm surpised the SPY is that low. interesting.
weekend reading
Posted by kurzweg on 20th of Jul 2009 at 03:39 pm
The White Papers at the bottom of this guy's blog are fascinating. They deal with Goldman Program trading. http://www.themistrading.com/