Monday, September 29, 2014

Guesstimates on September 29, 2014



December S&P E-mini Futures: Today’s range estimate is 1948-1968. Right now it appears that the intermediate term trend in the averages has turned downward. The prognosis now is for a drop to the 200 day moving averages. In the S&P 500 this currently is the 1897 level.
QQQ: Downside target is 94.  
TNX (ten year note yield): It looks like an extended up trend in yields has begun. The initial target is 3.00% but I think the 10 year yield will go significantly higher than that over the coming months.
Euro-US Dollar: The ECB quantitative easing program coupled with the Fed’s termination of its own program is likely to drop to Euro to 120.
Dollar-Yen: Next stop is 112.  
November Crude:   Resistance above the market is at 95. I expect the market to move below 90.
December Gold:  Gold is headed below 1100.  
December Silver: My bear market target remains 13.00.
Google:  GOOGL is headed for 650 and higher.
Apple:  I think AAPL is headed for 108.
Facebook: Upside target is 90.
Twitter: Upside target is 66.
Alibaba: Resistance is at 103 but I think that BABA will drop back to or below its IPO price before going much higher than that.
Visa: I think the bull market in Visa is over and that the stock will soon slide below its 200 day moving average and stay there.

Friday, September 26, 2014

Attention Traders

As you know I have started to post the S&P E-mini trades I make in my trading seminar CarlFutiaRealTime  on this blog's Twitter feed (at the top of the right hand column). You can follow me here on Twitter for free but keep in mind that the trade postings are delayed 5-10 minutes. Since I started posting these trades in October 2013 they have generated  a 43% return trading a single contract per $10,000 of account equity (a very conservative approach since day trade margin on a single contract is only about $2,700). Since the start of the seminar 42 months ago the trades made in the seminar generated a profit of 167% trading one contract per 10k of equity.

Here are the last seven comments I have received about seminar members experiences.

(for more follow this link)

Curt said .....

I just want to thank you for your service. Your work is the foundation of my trading technique. I am not sure what I would do without you. I suppose I should study all your information so I may be able to survive if you ever stop. Please please don’t stop for at least two years, by then, I should be safe.

AP said ...

Just wanted to thank you for sharing with us your very methodical and systematic approach to market.

I have given up every prior technique I used to use to analyze markets before joining your seminar. Now I just use the principles you teach here … such as repetition rallies/breaks, rejecting lows or highs of ranges and numerous others that you share day-in and day-out.

I have started keeping a diary of such wisdoms you share and it has helped me trade not one but multiple securities profitably.

So again, Thank you.

dover said...

Carl, I wish that everything I bought equaled the value of your Real Time E-mini Trading Seminar and Blog.

moar said...
Been subscribing for half a year and have a much better grasp on the market now and can “control” my trading in a whole new way. I really value this seminar. So, thank you Carl, i wish you all the best!

average said ...
Thank you. Your blog is the best investment I’ve made.

adam said...

carl – congratulations on a terrific year. the blog offers wonderful insight, and
personally i find that the more i follow you, the more i can think on my own
within your basic parameters and frame of reference. This truly is the
greatest gift or a achievement a teacher can have, so please gain satisfaction
in knowing that you are contributing greatly to the body of knowledge and
method in your blogosphere.

flag said...

Your Real Time is the Real Deal…….. The Best financial site and most visited of all my favorites.  Informative, actionable, reasoned, consistant and unique.
 

Here is what other traders, both amateur and professional, say about CarlFutiaRealTime

stocks and interest rates

I want to make a few comments on interest rates today but before I do I think the situation in the US stock market indices merits close attention.

Yesterday the S&P 500 closed below its 50 day moving average. The NYSE advance-decline line had been below its 50 day average for several days previously. The Dow closed just a tad above its 50 day average yesterday. This puts two of my three main trend indicators below their 50 day averages. As a rule this sort of bearish configuration is followed by a return to the level of the 200 day moving averages. The S&P's 200 day average is currently at 1898 while the Dow's is at 16,550.

There is always the possibility that yesterday's selling spasm was climactic in nature instead of a downside breakout. If it is a breakout the averages should close below yesterday's close within a day or two and keep going down. But if instead we see strength above today's high (whatever it turns out to be) early next week I will probably conclude that the bearish indication I think I see now is really a fake-out and that new bull market highs lie ahead.

Now to interest rates.

There is no question in my mind that the quantitative easing programs implemented by the Fed, the Bank of England, and belatedly by the Bank of Japan and the European Central Bank are responsible for a good part of the bull market advance in world stock prices during the past 5 years.

These QE programs all share a paradoxical feature. Purchases of fixed income assets tend to lower interest rates, other things being equal. In the short run other things are equal and the immediate effect of these programs is indeed to lower interest rates.

But the long run effects of successful QE programs are very, very different. The primary determinant of interest rates is expectations about the rates of economic growth and inflation. Taken together these constitute a forecast of future growth rates of nominal gross domestic product (no inflation adjustment). The whole purpose of QE programs is to raise expectations about the rate of growth in nominal GDP and, of course, to then have these expectations fulfilled.

A good rule of thumb to remember is that low interest rates are associated with weak economies and/or very low inflation rates while high interest rates are associated with strong economies and/or high rates of inflation. So a successful QE program will necessarily be followed by rising interest rates as the nominal rate of economic growth increases. This effect will be quite independent of central banks' short term interest rate policies.

Keeping these observations in mind take a look at the monthly bar chart at the top of this post. This chart shows the yield of the 10 year US treasury note.

The Fed pursued three distinct QE programs since 2009. The first two were temporary, had definite end dates, and consequently had limited effects. But in September of 2012 the Fed began an open-ended QE program which it said would continue until the states of the labor market and economy were restored to "normal". This was a very strong commitment to economic growth going forward. Only recently have economic conditions improved enough to allow the Fed to wind down its QE program.

For these reasons I think we have seen the low point in 10 year yields in the current 60 year interest rate cycle. The last low point in this cycle occurred just after World War II while the subsequent high point occurred in 1981 amidst world-wide inflation problems.

If I am right about this then I think the 10 year yield will trend gradually higher over the coming decades (!). Looking ahead for the next year or two I think this yield has a good chance to reach the 3.80-4.00%  zone (purple oval). There it would have reached the levels last seen in 2009-11 (red lines). A move up  in yields from the August 2014 low which matches the size of the move up in 2012-13 (blue rectangles) would put the 10 year yield in the same zone. Note that the upper parallel green trend line reaches this zone near the end of 2015.

Guesstimates on September 26, 2014



December S&P E-mini Futures: Today’s range estimate is 1953-1968. Right now it appears that the intermediate term trend in the averages has turned downward. The NYSE advance-decline line and the S&P 500 are both below their 50 day moving averages while the Dow closed yesterday right on its own 50 day average. Moreover the ES spent most of yesterday’s afternoon trading below the lower edge of what I thought was a 1964-68 support zone. The prognosis now is for a drop to the 200 day moving averages. In the S&P 500 this currently is the 1897 level.
QQQ: Downside target is 94.  
TNX (ten year note yield): It looks like an extended up trend in yields has begun. The initial target is 3.00% but I think the 10 year yield will go significantly higher than that over the coming months.
Euro-US Dollar: The ECB quantitative easing program coupled with the Fed’s termination of its own program is likely to drop to Euro to 120.
Dollar-Yen: Next stop is 112.  
November Crude:   Resistance above the market is at 95. I expect the market to move below 90.
December Gold:  Gold is headed below 1100.  
December Silver: My bear market target remains 13.00.
Google:  GOOGL is headed for 650 and higher.
Apple:  I think AAPL is headed for 108.
Facebook: Upside target is 90.
Twitter: Upside target is 66.
Alibaba: Resistance is at 103 but I think that BABA will drop back to or below its IPO price before going much higher than that.
Visa: I think the bull market in Visa is over and that the stock will soon slide below its 200 day moving average and stay there.

Thursday, September 25, 2014

Guesstimates on September 25, 2014



December S&P E-mini Futures: Today’s range estimate is 1983-92. I think this market is headed for 2080 but weakness below 1964 will mean it is headed for 1890 instead.
QQQ: Upside target is 103.00.  
TNX (ten year note yield): It looks like an extended up trend in yields has begun. The initial target is 3.00% but I think the 10 year yield will go significantly higher than that over the coming months.
Euro-US Dollar: The ECB quantitative easing program coupled with the Fed’s termination of its own program is likely to drop to Euro to 120.
Dollar-Yen: Next stop is 112.  
November Crude:   Resistance above the market is at 95. I expect the market to move below 90.
December Gold:  Gold is headed below 1100.  
December Silver: My bear market target remains 13.00.
Google:  GOOGL is headed for 650 and higher.
Apple:  I think AAPL is headed for 108.
Facebook: Upside target is 90.
Twitter: Upside target is 66.
Alibaba: Resistance is at 103 but I think that BABA will drop back to or below its IPO price before going much higher than that.
Visa: I think the bull market in Visa is over and that the stock will soon slide below its 200 day moving average and stay there.