Distressed Volatility | Financial Markets, Economy, Technical Analysis

Applying Fibonacci to Stock Market Patterns - Guest Post

2012-02-02T01:10:00.002-06:00

Guest post by Elliott Wave International Applying Fibonacci to Stock Market Patterns It's easier than you might think! February 1, 2012 By Elliott Wave International Patterns are everywhere. We see them in the ebb and flow of the tide, the petals of a flower, or the shape of a seashell. If we look closely, we can see patterns in almost everything around us. The price movements of financial markets are also patterned, and Elliott wave analysis gives you the tools to interpret those patterns. The Fibonacci sequence is vital to Elliott wave analysis -- as a matter of fact, R.N. Elliott wrote that the...

Watching German Bund Yields, BUNL (Bund Future ETN), EUR/USD (2/1/2012)

2012-02-01T07:15:00.001-06:00

German government bonds (bunds) and the euro will be interesting to watch as Greece either makes a deal with Greek bond holders to take a 70% loss to reduce its debt load by 100 billion euros, which would allow the next rescue loan from the EU (mainly Germany) and International Monetary Fund (AP), or sees a disorderly default. To make things even more interesting, the European Central Bank "is planning a second round of three-year bank loans next month (LTRO), after lending 489 billion euros ($645 billion) in December" (BusinessWeek), to add more emergency liquidity to the banking system and for banks to buy...

DeMark Still Thinks S&P Tops at 1338-1342, With Perhaps An Intraday Spike to 1375

2012-01-31T18:48:00.001-06:00

UPDATE: Tom DeMark told Bloomberg TV's Adam Johnson yesterday that the S&P will still top out between 1338 and 1342 (closing prices), with perhaps an intraday spike to 1375. DeMark said the long-term trend is "recycling". I blogged about DeMark's previous Bloomberg appearance here. The S&P 500 hit an intraday high of 1,333 last Wednesday, which is where the 2007 downtrend hits, but pulled back to 1,312 today. As noted on my previous post, there are still two more uptrend lines to break to confirm further downside ahead, in my opinion. DeMark created the DeMark Indicators, which traders use to measure market...

10-Year Portuguese-German Yield Spread Spikes to 14.51 (New High), 10-year Yield at 16.45% (Charts)

2012-01-30T06:43:00.002-06:00

The 10-year Portuguese/German yield spread is up 8.56% right now at 14.51! This is a new high it looks like. The spread measures Portugal's credit risk to Germany, since Germany is the safest sovereign credit in the eurozone. Look at the 1-year chart below of the spread. It is going parabolic! The 10-year Portuguese government bond yield is hitting a new high as well, up 8.1% at 16.45%. And last but not least, Portugal's credit default swaps hit a new high. Is there a bailout or default event coming? "LONDON/LISBON, Jan 30 (Reuters) - Portugal's slide towards becoming the next Greece - needing a second bailout to...

EUR/USD Lower Ahead of Greek Debt Talks, EU Summit (Market Links)

2012-01-30T01:27:00.001-06:00

While waiting for news on the Greek debt deal and EU summit, here are some headlines in the meantime and a chart of EUR/USD at 1.317 (-.05%). Look at the perfect uptrends in the descending channel. The March E-mini S&P future is at 1305.5 (-0.53%). Goldman's Tom Stolper Conducts Sunday Hitfest On The USD (1/29/2012, Zero Hedge) Cutting Into Muscle - The Record Corporate Margin Juggernaut Has Just Rolled Over (1/28/2012, Zero Hedge) Bubble Watching: Hainan Edition (looking at the property bubble in China) (1/30/2012, Also Sprach Analyst) China Signals Limited Loosening as PBOC Bucks Forecast...

Is $SPY Exhausted Yet In Uptrend? $EURUSD Just Spiked to 1.317! (Technical Update)

2012-01-26T05:09:00.001-06:00

Here is some technical analysis for $SPY (the S&P 500 ETF) and EUR/USD. EUR/USD just pierced through October 2011 resistance and hit 1.317. The euro spiked against the dollar yesterday after the Fed (FOMC) said they anticipate "exceptionally low levels for the federal funds rate at least through late 2014." The FOMC kept the rate at 0-0.25%, and are continuing to reinvest principal payments from agency debt and agency mortgage-backed securities in agency MBS. It is interesting that EUR/USD's current uptrend line has the same exact slope as the October 2011 uptrend line. Y=mx+b algo? While the Euro is flying...

Something's Fishy in Tripoli - Guest Post

2012-01-25T19:36:00.002-06:00

Guest post by Daniel J. Graeber of Oilprice.com Something's Fishy in Tripoli Way back in early 2011, members of the U.N. Security Council had no problem getting a resolution through that authorized military force in Libya ostensibly to protect civilians from attacks by forces loyal to strongman Moammar Gadhafi. The year before, lawmakers on both sides of the Atlantic were bickering over who did what and why in terms of the cancer-stricken Lockerbie bomber. This Scottish decision to release him, depending on which U.S. lawmaker you spoke with, was tied to a BP deal to drill for oil in Libya. Despite fractures in...

Fed Sees 0% Fed Funds Rate Through 2014! (Economic Projections Table)

2012-01-25T19:24:00.002-06:00

In today's FOMC statement, they decided to keep the federal funds rate at 0-0.25% and anticipate "exceptionally low levels for the federal funds rate at least through late 2014." ZIRP! They also "decided to continue its program to extend the average maturity of its holdings of securities as announced in September" (operation twist). Below is the full release and a table of their projections for GDP growth, PCE inflation and the unemployment rate. They lowered their GDP growth projection for 2012 and 2013 from November, lowered their unemployment rate projection, and kept PCE inflation slightly unchanged. I also...

Live Video of President Obama's 2012 State of the Union Address

2012-01-24T20:09:00.003-06:00

I embedded the live Youtube video: "The online-only enhanced version of President Obama's third State of the Union Address features charts, stats and data that helped inform President Obama's policy decisions." You can now follow The White House on Google+.

IMF Lowers Global Growth Outlook, Europe is Epicenter (IMF Videos, 1/24/2012)

2012-01-24T19:35:00.000-06:00

The IMF (International Monetary Fund) lowered its global growth outlook from its September projections. Europe tipping into recession is the greatest risk ("epicenter") to world growth. Read more: World Economic Outlook Update: Global Recovery Stalls, Downside Risks Intensify -IMF). In the three videos I embedded below, the IMF talked about their global growth outlook, fiscal challenges advanced economies face, and financial sector risks. Issues raised by IMF analysts have been addressed by the United Nations, Ray Dalio on Charlie Rose, Robert Prechter, David Rosenberg, and Richard Koo, on this blog (views vary):...

George Soros: Deflation is Best-Case Scenario, Collapse of Financial System is Worst-Case Scenario

2012-01-24T17:12:00.001-06:00

Famed macro trader/hedge fund manager, George Soros, was interviewed by Newsweek and issued a warning for the developed world. Image Source: NorwayUN "“I am not here to cheer you up. The situation is about as serious and difficult as I’ve experienced in my career,” Soros tells Newsweek. “We are facing an extremely difficult time, comparable in many ways to the 1930s, the Great Depression. We are facing now a general retrenchment in the developed world, which threatens to put us in a decade of more stagnation, or worse. The best-case scenario is a deflationary environment. The worst-case scenario is a collapse of...

Jon Stewart on Newt Gingrich (Daily Show Clip)

2012-01-24T16:39:00.001-06:00

This was an interesting clip on the Daily Show (h/t Zero Hedge via Daily Crux). The Daily Show Get More: Daily Show Full Episodes,Political Humor & Satire Blog,The Daily Show on Facebook

Links: Greece Debt, Portugal, Japan, Treasuries, S&P 500, Natural Gas (1/24/2012)

2012-01-24T04:28:00.000-06:00

Eurozone finance ministers reject Greek debt offer - (Telegraph) Euro zone ministers reject private bondholders' Greece offer - (Reuters) EU Seeks Bondholder Concessions on Greece (Bloomberg) Timely Greek lessons on the eurozone crisis (by George Provopoulos, Bank of Greece) - (Financial Times) Fears Mount That Portugal Will Need a Second Bailout - (WSJ) Bids for Portugal REN with 30-50 pct premiums-sources (Reuters) Goldman Tells Clients To Short US 10 Year Treasurys (Zero Hedge) 10 Good And Bad Things About The Economy And Rosenberg On Whether This Isn't Still Just A Modern Day Depression (Zero...

Watch The Republican Debate Live Here (NBC)

2012-01-23T19:57:00.003-06:00

Tonight's NBC Republican debate is in Tampa, Florida and moderated by Brian Williams. Ron Paul, Mitt Romney, Newt Gingrich and Rick Santorum are left. Watch it live below. Photo source: NBC. Visit msnbc.com for breaking news, world news, and news about the economy

Tom DeMark: S&P is Close to a Top, Bullish on DAX, Bearish on Bunds (Charts)

2012-01-23T07:01:00.000-06:00

Tom DeMark, creator of the DeMark Indicators (used to time market exhaustion), was on BloombergTV last Friday and made a call that the S&P 500 would top out between 1,338-1,342 this week (specifically on Tuesday). It closed on Friday at 1,315. Watch the interview after the jump for more details. The chart definitely looks like it's getting exhausted after this nice rally. On December 5, DeMark predicted that the S&P would hit 1330-1345 when it was trading at 1,258. He thought it would hit by Christmas, so he was a month off. The downtrend from the 2007 peak and 2011 high hits around 1,330 today. He...

GOOG is Back Below 2010, 2011 Highs After Q4 Earnings, Will Google Finance Socialize With Google+?

2012-01-20T21:36:00.001-06:00

Since DistressedVolatility.com gets paid by Google Adsense and is powered by Google services, I thought I'd listen to GOOG's Q4 2011 earnings call and look at its financial results. I embedded the call below via Youtube and put up a summary of Google's financial results from its press release. Google closed down 8.38% today at $586 after reporting weaker results. From WSJ: "The weaker-than-expected results were hurt by Europe's economic woes as well as mobile and other new forms of online advertising selling for lower prices than Google's traditional ads. The issues come as Google continues its costly expansion...

What the Next Decade Holds for Commodities - Guest Post

2012-01-18T21:19:00.001-06:00

Guest post by Frank Holmes, CEO and Chief Investment Officer of U.S. Global Investors. What the Next Decade Holds for Commodities What a decade! A rapidly urbanizing global population driven by tremendous growth in emerging markets has sent commodities on quite a run over the past 10 years. If you annualized the returns since 2002, you find that all 14 commodities are in positive territory. A precious metal was the best performer but it’s probably not the one you were thinking of. With an impressive 20 percent annualized return, silver is king of the commodity space over the past decade with gold (19 percent...

EURUSD Needs To Break Downtrend, Big Move Coming Either Way

2012-01-17T08:49:00.002-06:00

EUR/USD is trying very hard to break through that downtrend line in the death channel. It tried for the fourth time earlier this morning but couldn't manage. It is inside both channels again and needs to decide which path to take. If it can breakout of the death channel with confirmation, 1.3146 is the next resistance level and then between 1.34-1.38 through March. Billions of Italian and Greek bonds mature in the next two months. If EUR/USD continues to ski down this slope, 1.18 support is next and then 1.08-1.10. Interesting article at Zero Hedge: A Shocking €1 Trillion LTRO On Deck? CLSA Explains Why...

Morgan Stanley's Adam Parker: S&P Hits 1,167 in 2012, Multiple Contracts With Low Rates, Earnings Plateau

2012-01-17T07:03:00.000-06:00

S&P 500 through 2012 (via freestockcharts.com) Adam Parker, chief equity strategist at Morgan Stanley, has a bearish outlook on the S&P 500 for 2012 with a year-end price target of 1,167. The S&P is currently trading at 1,289. The interesting part about his call is that he thinks the S&P's price/earnings multiple will contract "to 10x over time" because rates are low. He was on CNBC on January 3 and 9 discussing Morgan Stanley's report, see quotes below. To hedge himself, I noticed a CNBC slide that said he could be wrong if there is QE3, a meaningful cyclical upswing, or the U.S. government...

S&P 500 Chart Looking Into 2012, Key Trendlines To Watch (SPY, $SPX)

2012-01-17T02:22:00.001-06:00

Source: freestockcharts.com

S&P Downgrades France, EFSF; Greece Defaults Shortly (EUR/USD, Bond Yield Reactions)

2012-01-17T00:33:00.001-06:00

10-year Portuguese Bond Yield (Bloomberg) European sovereign credit ratings are in the news again. Standard & Poor's downgraded nine European nations on Friday, including AAA France, AAA Austria, Italy, Spain and Portugal. Yesterday, S&P also downgraded the EFSF, or European Financial Stability Facility, which is dependent on France's creditworthiness since they fund a large portion of the fund. Moody's then spoiled the downgrade party by keeping France at Aaa with a stable outlook. However, markets, except for Portugal (see chart), treated the catalysts like they were priced in. The 10-year French OAT...

Republican Presidential Debate Live Streaming on Fox

2012-01-16T19:55:00.002-06:00

If interested, the Republican presidential debate is live streaming at live.foxnews.com. Huntsman dropped out of the race and endorsed Mitt Romney.

Samsung Transparent Smart Window at CES 2012 (Video)

2012-01-16T04:50:00.001-06:00

The Samsung Transparent Smart Window was presented at the 2012 Consumer Electronic Show last week. I thought it was interesting. Thoughts?

Euro Couldn't Breakout Again, Now Selling Off Hard (EURUSD 1.2670, -1.24%)

2012-01-13T09:17:00.000-06:00

Ugly day today for EUR/USD. It couldn't breakout again, which means it is still trading in a steep descending channel. Fears of France getting downgraded by S&P and JP Morgan's weak quarter are hitting stocks and the euro. On the chart, 1.258 is the next support level and then 1.18. source: freestockcharts.com

Lampert Buys Sears Stock From ESL, Open Market; CDSs Spike (SHLD)

2012-01-13T08:23:00.000-06:00

Source: Wikipedia In two SEC Form 4 filings on 1/11/2011, it appears that Edward Lampert, chairman and majority shareholder of Sears Holdings Corp. (through his hedge fund RBS Partners et al.), bought 4,461,329 shares of $SHLD from ESL Investors LLC, his own fund, at $29.2 per share on January 9 for $130 million. Was this a redemption? The filing also said that ESL Investors LLC distributed 573,184 shares to the managing member of Investors (aka RBS Partners) "in lieu of a cash payment for management fees." Lampert also bought 409,000 SHLD shares on the open market between $29.52-30.99 per share on...