Wednesday, May 12, 2010

Guesstimates on May 12, 2010

June S&P E-mini Futures: I think that last week's low at 1056 ended the correction from 1216. Today's range estimate is 1150-75.

QQQ: A move up to 54.00 will be the next big swing.

TYX (thirty year bond yield): I think this market is headed for 5.40%.

TNX (ten year note yield): I think that the market has begun a swing up to 4.50%.

Euro-US Dollar: The market is starting to stabilize. The 131 level is resistance.

Dollar-Yen: A rally to 100.00 is underway. Support is at 90.00.

June Crude: I still think the next big move will take crude oil to 50.00.

GLD – June Gold: The odds are that the market will continue upward to 1320. I still expect to see 875 before 1400.

SLV - July Silver: I now think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 495-505 zone is support. A move that should take GOOG above 700 is underway.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.


spycharter said...

I think the market will drop in an attempted shakeout before climbing higher.

Edwin said...

I don't THINK...I LOOK instead and see how the current Box (SPX cash 1170 to 114) is going to play out. If it breaks out, I will add to my position. I am using Carl's box theory so I don't have to THINK since I am only human and bias tend to be wrong.

Carl...I have been studying your calls and definitely your math background is your edge.

Anonymous said...

spycharter, was that just a teaser, or a sample shakeout on last Thursday?

I concur with you that a real shakeout is yet to happen. Actually, it will be a knockout!

And, long-term investors will leave this market for good, left exclusively for trading by bank-owned HFT computers.

Anonymous said...

I am surprised you have ignored GLOBEX low of 1141

Bill said...

It's exactly because there are too many people like Kishore out there (gripped by fear while the market goes up) that the rally has a long way to go.

When the VIX goes back to 15 then we can talk about complacency and the market will correct again. Right now there's too much fear as shown by the VIX for this market to correct. And although the VIX has come down substantially from its highs last week, it's still not low enough to be concerned about.

Anonymous said...

Bill, markets evolve.

Currently, the short-term moves are controlled, more and more, by HFT computers.

Your assumptions about individual psychology and extension to all market participants, is invalid. I hope you don't trade based on such thinking.

Also, incidentally, VIX has lost its traditional meaning because HFT computers have no emotions. They are capable of causing wild-ass moves without any rhyme, reason or feelings.

Edwin said...


I am amaze at ppl talking as if they have the crystal ball.

Why? How can they be successful in trading?

The think and talk with their bias while the market goes higher. Very funny.

spycharter said...

Edwin- It was my "thinking" that had me in cash a week before the glitch crash on the 6th. How useful were your reactionary skills on the 6th?

If SPY holds 117.1 then we head higher. SPY has to beak 116.45 to make a sustained down move. Investors are buying the crash and expecting the market to rally. And it will, but there will be a shakeout of dip buyers first.

George Rahal said...


I am certain that, in spite of his warnings, many traders shadow Carl's trade posts. Last Thursday, he posted having gone long at 1148.75. In the comments, many readers cheered his great entry and trade. Carl sold at 1129.50, which is fine; he realized he was wrong and got out.

Now, how many people shadowing him were not able to see his post in time? And a much more important question is: how many of those mimicking his trades had the discipline he had of selling at a loss? I guarantee you anyone inexpert enough to blindly follow him--or follow anyone else for that manner-- held on to the losing trade until the losses became much greater in moments!

Emerson wrote: There is a time in every man's education when he arrives at the conviction that envy is ignorance; that imitation is suicide.

TMG2010 said...

Did the drop today count as the drop u show on your chart from yesterday? Thanks!

Anonymous said...

When more than 60%, of already historically low volume, is back and forth trading by HFT computers owned by banks. They can play all kinds of tricks, as shown last Thursday, to generate trading profits over the blood of average investors. How do think that all major investment banks had immensely profitable, flawless, without a single losing day, first quarter? Blood money!

roguewave said...

George...any trader with 2cents of education even early on will at least know two very simple things your own work..

..2 never allow a profit to turn into a large loss...

Followers who are foolishly violating pt 1 are following one who foolishly violated pt 2..

.a double whammy if there ever was one

Bill said...

Edwin: All I know is that I know nothing, just like Socrates. I don't pretend to have a crystal ball. Nobody knows with certainty where the market is going, only God knows. And anybody that claims to know with certainty is plain arrogant and unaware of his ignorance.

Kishore: Please stop blaming the machines. Goldman, JP Morgan, Citi, and Bank America made their profits as market makers. They don't bet on the direction of the markets. As I said above nobody knows the direction of the market, least a brainless computer. The computers do a great job because they provide liquidity to the market, without that liquidity speculators like Carl and others wouldn't be able to make a living. The idea that the big banks know the direction of the market or that they make best where the market goes is rubbish, the big banks are not speculators, they are market makeers or arbitrageurs however you call them. That's why they always make money.

tooearly said...

Carl; you have had to readjust your stops upwards repeatedly now on the metals. Why so stubborn in this one area? bias?

Anonymous said...

Bill, where the "market makers" last Thursday. There were no bids, no liquidity!

Nobody knows the future direction, but surely we all place our bets based on our own best educated guesses.

There is a lot more to trading than just blind faith or following someone else's trades. And I am yet to find a blog that does not have a bias.

If you are not open to seeing how the some market participants are openly controlling the market, I wonder what you see!

Please don't accuse me of blaming anyone but I do get my information from many many sources. Market makers and arbitrage traders never make the kind of money that the investment banks have been recently making due to their outright criminal behavior and control of the market. There is an extremely low probability of having no loss day in an entire quarter by not just one bank but all major banks.

Also, I can see why Carl has a wise policy to not bothering to answer most of the comments on his blog. The rampant ignorance is appalling! But, never mind, you are still loved because others need your money!

Binary Events said...

Kishore,, you are misunderstanding this. When the media reports a bank does not have a losing trading day for months, they are referring to the net gains vs. losses across all businesses - all asset classes. There are definitely individual businesses with losing trading days. I know as I am working at one of them as a market maker! But to be clear on the "market making", I prefer to call it "proprietary market making" which means, when I am asked for a price to a large client, I show the client my bid / ask spread but I will of course shade the price slightly higher if i am buyer or shade it lower if i am a seller. And naturally whether I am a buyer or seller is based upon my discretionary views as well as any quantitative analysis done to justify. And I can tell you from where I sit, we are not controlling any markets. I have been a market maker in liquid options for nearly 20 years and nobody I know is controlling these very deep markets. I should also add, the bank I work at also had positive trading pnl every single day during! I also used to work as a specialist on the exchange before becoming an OTC market market. There is no consortium of criminal behavior controlling the markets.. perhaps in the illiquid stuff that I am unaware of. But not in the major asset classes. -MK

Atrader said...

No daily close below 1039.75 means we go up.

1126.25 is the line in the sand.

1091 is also support.

1275 here were come.

No resumption of a bear market will start like the patern we had on the drop. The market makers have to be ready, set and loaded.....and they are just recovering from the onslaught.

Up we go.

Gold to 1350 or 1380 but then it will drop hard...choose your numbers...most will say 900/875...that means it will drop further to 750....remember the 680 drop nobody thought it would hit, just like ES to 1057.50

I'll be shopping for some OTM puts on ones. Like 1057.50way OTM from 1207 those cheap ones can become real good.

So many trades...not enuf time or, beans, O.J, copper, sugar(retrace), corn, oats, Cattle, Gold, silver, CAD, cotton, al.

Anonymous said...


I noticed you didn't post my comment. I hope I didn't offend you with it. I have great respect for you.

curt said...

kishore...your classic...accusing others of ignorance. You my friend are the very definition...frankly anyone with your apparent track record is either not trading because they are broke or never did trade but likes to talk the talk...pathetic.

Anonymous said...

curt, you are obviously the epitome of ignorance about me or my trading activities. But, I prefer it that way. I will always be on the other side of losers like you. Just take care of your own trades!