Wednesday, July 16, 2008

Guesstimates on July 16, 8:15 am ET

Spiders - September S&P E-mini Futures: I think the market has a good shot at 1240 today and if it gets there the odds will favor continuation up at least to 1265. There are many bullish divergences in the advancing issues numbers which themselves are at extreme “oversold” levels. This together with the gloomy state of sentiment convinces me that an very big rally is imminent and that this mini-bear market is near its end. 

QQQ: Support remains at 44.00. Resistance stands at 47.50.  During the next few months the market should rally to 55 or higher.   

TLT - September Bonds: Support is at 115-00 and as long as that holds I’ll stick with my 118-00 upside target. 

September 10 Year Notes: Support is at 113-24 and as long as that holds I’ll stick with my 117-16 upside target.  

Euro-US Dollar: I think the market is on its way to 163. Support is at 155.80. 

Dollar-Yen: The yen is headed for 103.50.  From there the rally to 112.00 will resume.  

XLE - OIH - USO – August Crude: Crude is headed for 160-165. Support is at 133. 

GLD - August Gold: I think the market is headed back to 1000. Support is at 915. 

SLV - September Silver: I think silver is the way to the 2100 level. 

Google: GOOG should find support at 506 or so and the next development will be a move to new bull market highs.  


Edwardo said...

Carl, you are so so wrong. When I ponder your missing, by several generously measured country miles, the call on what is evolving as the greatest financial and economic debacle in the nation's history, I can only shake my head in utter disbelief.

This is a bet, if you are willing to take it.

We will see 1050 on the S&P 500 before we see 1380.

Both numbers are approximately 160 points from yesterday's close.

The stakes are one bottle of a vintage red wine.

Anonymous said...

i think the eurusd has topped out and is ready to fall yet. Target is 1.5600 and then lower below 1.50 in agreement with Carl's first guesstimate. I doubt we will revisit the all time highs for enough time to come. Crude oil is headed for 121 and 96 after while 144 is strong resistance. I think gold has topped out and is headed down from 987 onward and heading for 697 USD. Good trading all !MC

Carl Futia said...

Dear Edwardo:


Anonymous said...

Edwardo, i usually do not bet, but for a good old bootle of vintage wine i can bet against you on your terms, if Carl's does not accept the bet. MC.

Anonymous said...

I see that this is getting serious now.

How about an old Warre port?

I am with only because I am beginning to understand his reasons.


Anonymous said...

Hi Carl,
We have sentiment indicator now about 30.I think, we need one spike over 35 and than we will go up.We need 1-2 days more.But until friday, we will go up.

Anonymous said...

I am as big a bear as Eduardo, but I have more respect for bear market rallies.

this will be interesting as I am buying etfs this week but plan to sell before 1380. Not that we will not get to 1380 it is just that I would be perfectly happy with a lower risk smaller profit

Anonymous said...




Anonymous said...

I won't pass up an easy bet, my money is on Carl.

Kindest regards,


Anonymous said...

We're still working to a bottom on Friday or Monday - a small bullish wedge. No bottom yet.

Anonymous said...

Edwardo ... what kind of vintage red do you have on offer? Chateux Villiers perhaps?

Anonymous said...

A good shot indeed. Very nice call!!

Sam said...

Wow, Edwardo just called the bottom. Nice!

Anonymous said...

Market sentiment is always a good indicator and it had gotten pretty bearish...I think we are in the process of making a bottom here. WFC raising the divy and earnings good a nice catalyst. Also, an expected draw on crude turned out to be a surplus of almost 3b. Carl, I always find your opinions valuable and from one market junkie to another, Thank You, Kind regards, Janet

Anonymous said...


My thoughts on Chris Cox and the implications behind the "short selling rules." Initially the rule(broker dealers were previously exempt from having to borrow in order to short another BD or GSE.) Now they have to borrow and settle. In essence they were allowed to "shoot each other" with massive non stop, non borrowed short selling) The new rule would go(read have gone) into effect yesterday, then the statement was clarified to say, it would go into effect today, then clarified - nay - delayed until monday.

Initially my first question of course, is, what does that mean to the already existing short positions, did they need to be covered, or would they be grandfathered. I don't think so. It seems logical to me that you would see some MASSIVE covering of positions into FRIDAYS close. The reason for this is because those firms with shorts on the BD's and GSE's will need to borrow the shares needed in order to cover there positions and I'm willing to bet that there aren't enough shares out on the street to allow such a thing to happen(massive shorting). Thus, everyone that is short has to cover and cover HARD and FAST...If the expression "you can't see the market move higher without the financials obtains", you should expect some very large moves in the markets the next two days. As far as capitulation is concerned,it can't happen if it is not allowed to happen. The rules regarding short selling will be in effect for 30 days with further study for its application across a broader segment of the markets. If the uptick rule comes back, I can imagine that the end of the descent for this market has arrived (floor), and the message from the Treasury, FED, SEC, is BUY OR DIE.

'Tis the stuff History books are made of...Everything will get thrown at this market. Everyone makes money on the way up, only few on the way down..Enter the Republican Socialism(not my term.)

Veritatem Dies Aperit.

Anonymous said...

Even after a 40 poin snp rally, I am going to take Edwardo's side.
Yes I think we go to 1300-1325 and it might be close to 1380 but we will also see much lower later in the year.
This isnt a 'mini-bear'. The bear in real terms started in 2000 and the dow in terms of gold is already down 75% in major bear territory.
I guess that you dont read or dont believe Nouriel Roubini. Most of his predicitions have come right todate. He thinks 40% down minimum.

Anonymous said...

Hi All.

I'm reading Carl's blog for a long time. I often wrote to people like Edwardo with some answer because I knew he doesn't care. Edwardo how do you feel as perfect contrarian indicator?? You can be right and Carl can be wrong. The difference is he will change his mind as soon as he see some troubles ahead. This is what traders do. You will sit with your position because you have a bet and will loose more than you think because you have no brain to change with a changing market. That is obvious for me and for everybody who works hard in this market. So give us your money Edwardo and be strong .. you have to be very strong because as soon as you finally capitalize and close your position we will move down. Carl, thanks for a good job. One more thing ... Edwardo read the post "Should you speculate?".


Anonymous said...

Does Nouriel Roubini read Carl? : )
In bear markets, bears will be correct.
The Dow price in gold to me is one that EWI uses, but no one buys the Dow with gold.

As far as being in a bear market since 2000, that is open for debate, and only the future will tell us. After the major decline in the Nasdaq of over 80%, it is STILL 100% higher from its lows. A pessimist says that is a 8 year bear market, an optimist says it is a very good 5 year bull market. The Dow has one potential wave count where wave 1 completed in October after a 7,000 point rally, and wave 2 has retraced 3500 points of it, or 50%, which is normal. So while prices might be where they were several years ago, actual pattern shows a different story. Some consider 1966-1981 to be a 15 year bear market, but I don't. To me, the bear market ended in 1974, then a couple of "1's and 2's" made it look like no progress was made, but it sowed the seeds for the bull market that followed.
Look at the Dow from 1929 to 1932 and then the Nasdaq from 2000-2002, and you will see a nearly perfectly identical pattern. Out of that low in 1932, the Dow doubled, corrected sharply, doubled again, corrected sharply, and doubled again in wave 5, over several years. Many would have said that that no progress had been made from years earlier, but truth is, you had a new bull market started, and then backing and filling. The new bull market didn't start in 1955 when the Dow exceeded its old highs (1947ish with dividendes included), it started in July of 1932.

Just some things to consider, and another way of looking at the exact same periods of time.