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Sometimes you just have to marvel. I present the following chartification without comment...
5% was a lay-down misere... and A$10k...
OK - so I made a comment. Sue me.
What the above pretty picture is meant to point out, dearest Reader, is that the bad ball is easy to spot. I declared that DAX would give a 5% rally, and a 5% rally it gave. To wit (from Monday's OzRant):
Tonight I plan to re-enter a DAX long position, after about an hour of the Kraut session... there might well be early weakness, but a decent market bounce this week is pretty much baked in: do not be shocked if, by the end of this week, I am toot-tooting about having said that the DAX will be up 4 or 5% for the week.
I should have taken my own (non-)advice and waited for 'first hour weakness' in the German cash market... could have got a 50-60 point better entry. (Also, I did not exit anywhere near 4500).
Doubtless some of you - seeing the weakness in DAX continue after my entry, will have had moments of doubt. Mere flickers across the frontal lobe, to be sure, but doubts nonetheless. Shame on ye of little faith.
I often use the 'lacka band' analogy to describe why contrarian methods work. You wait until the lacka band stretches and stretches... patience, m'lad, patience... knowing full well that it can never break. A non-breakable lacka band (i.e., markets do not go to zero or infinity) must - at some stage - snap back.
If you choose your 'stretch point' judiciously, you will find that the odds of never getting a profitable exit are as near to zero as makes no odds.
Plus, you will never, ever be the dickhead who bought Euro at $1.59, $A at 0.98 or Oil at $147. You'll not have to face the shame of having been the chap who forked over his hard-earned to buy Nasdaq100 futures above 5000.
So anyway.... back to the lacka-band. If you are very patient (in fact, a little more patient than your beloved GT) you will always wait for that most beautiful of signals (not shown on the chart - sucked in)... the Rant Lacka-Band 'Yoiks Away' Indicator (also known as the 'Tally Ho... loose the dogs' signal). It is when the nuffnuffs have spent their last dollar (either on the long or short side) and the lacka-band is at full stretch. Then you simply take the other side.
I seldom have the patience to wait right until the 'Tally Ho' moment... I am almost always ready to have a crack just prior to acceptances. The peace of mind that contrarianism gives you is so profound that you don't sweat negative excursions - you can tell tell at a glance whether or not your trade is going to give you something back in the end.
And here's another contrarian call - with State power-grabbery reaching new depths: within 20 years there will be no such thing as a passport.
Economic News
Honestly... who gives a rat's?
The US economy is stuffed, the European economy is worse, the Strayan government is about to embark on a massive spending binge, the political parasites who consider themselves Europe's new princes have completely abandoned their stupid fake 'stability pact'... we are in the toilet, and to pore over economic indicators is not useful: either they will simply confirm what I think, or they are not worth reading.
Headline Indices
The Dow Jones Industrial Average index (DJI) fell -121.7 points (1.51%) to 7956.66 points. Total volume traded in the 30 components of the index was 1.56bn shares. Decliners outpaced gainers by 4 to one, with 24 decliners to 6 advancers. Declining volume was greater than advancing volume by 1.19bn to 374.11m shares. The main decliners (in percentage terms) were -
- Bank Of America (BAC) -0.6 (11.3%) to $4.7 on volume of 606.92m shares;
- Disney Corp (DIS) -1.62 (7.9%) to $19 on volume of 48.5m shares;
- AIG (AIG) -0.05 (4.6%) to $1.03 on volume of 37.75m shares;
- General Motors (GM) -0.13 (4.6%) to $2.72 on volume of 8.5m shares; and
- Verizon (VZ) -0.95 (3%) to $30.61 on volume of 17.77m shares.
The S&P500 index (SPX) dropped 6.28 points (0.75%) to 832.23 points. Total volume traded in the 500 components of the index was 4.83bn shares. Decliners outpaced gainers by 1.3 to one, with 266 decliners to 211 advancers. Declining volume was greater than advancing volume by 2.89bn to 1.87bn shares. The main decliners (in percentage terms) were -
- Textron Inc. (TXT) -1.69 (21.2%) to $6.28 on volume of 36.81m shares;
- Huntington Bancshares (HBAN) -0.37 (20.4%) to $1.44 on volume of 23.52m shares;
- SLM Corporation (SLM) -2.24 (19.9%) to $9 on volume of 24.05m shares;
- Fifth Third Bancorp (FITB) -0.25 (14%) to $1.54 on volume of 29.25m shares; and
- Ryder System (R) -4.53 (13.1%) to $30 on volume of 3.32m shares.
The Nasdaq Composite declined 1.25 points (0.08%) to 1515.05 points, while the Nasdaq100 index (NDX) declined 0.23 points (0.02%) to 1215.43 points. Total volume traded in the 100 components of the Nasdaq100 was 981.65m shares. Advancers outpaced decliners by 1.1 to one, with 50 advancers to 47 decliners. Advancing volume exceeded declining volume by 678.17m to 300.55m shares. The main decliners (in percentage terms) were -
- Wynn Resorts (WYNN) -2.59 (9%) to $26.23 on volume of 7.35m shares;
- Costco Wholesale (COST) -3.14 (6.8%) to $42.98 on volume of 20.52m shares;
- Discovery Holding Co (DISCA) -0.89 (6.1%) to $13.75 on volume of 3.3m shares;
- UAL (UAUA) -0.43 (4.8%) to $8.54 on volume of 7.42m shares; and
- IAC/InterActiveCorp (IACI) -0.6 (4.1%) to $14.13 on volume of 3.66m shares.
Volatility
The CBOE Volatility Index rose +0.79 points (1.83%) to 43.85 points. and the CBOE Nasdaq100 Volatility Index declined 0.06 points (0.14%) to 42.82 points..
Breadth and Internals
A total of 3861 issues traded today on the NYSE; 1674 stocks posted gains for the day, and there were 2082 losers. 9 stocks made new 1-year highs on the NYSE, while 112 shares plumbed new 52-week depths.
On the Nasdaq 2875 tickers traded today; total Nasdaq volume was 2.2bn shares. A total of 1092 stocks posted gains for the day, with aggregate volume of 1.34bn shares changing hands in the day's winners. The red zone of the Nasdaq exchange comprised 1650 losers, and total declining volume was 0.83bn shares. 8 Nasdaq-listed stocks hit new 52-week highs, while 121 shares dipped to new 1-year lows.
| Major Market Statistics | |||
| Index | Close | Gain(Loss) | % |
| Dow Jones Industrial Average | 7956.66 | -121.70 | -1.51% |
| S&P500 Index | 832.23 | -6.28 | -0.75% |
| Nasdaq Composite | 1515.05 | -1.25 | -0.08% |
| Nasdaq100 | 1215.43 | -0.23 | -0.02% |
| CBOE Volatility Index | 43.85 | +0.79 | 1.83% |
| CBOE Nasdaq100 Volatility Index | 42.82 | -0.06 | -0.14% |
Dow Darlings
- Intel (INTC) +0.29 (2.1%) to $13.88 on volume of 77.1m units
- Caterpillar (CAT) +0.61 (2%) to $30.6 on volume of 17.4m units
- American Express (AXP) +0.27 (1.7%) to $16.36 on volume of 14.2m units
- Citigroup (C) +0.03 (0.9%) to $3.49 on volume of 184.4m units
- Boeing (BA) +0.30 (0.7%) to $41.97 on volume of 6.7m units
Dow Duds:
- Bank Of America (BAC) -0.60 (11.3%) to $4.70 on volume of 607m units
- Disney Corp (DIS) -1.62 (7.9%) to $19.00 on volume of 48.6m units
- General Motors (GM) -0.13 (4.6%) to $2.72 on volume of 8.5m units
- Verizon (VZ) -0.95 (3%) to $30.61 on volume of 17.8m units
- Wal-Mart (WMT) -1.39 (2.9%) to $46.42 on volume of 26.3m units
Most Traded Dow stocks:
- Bank Of America (BAC) -0.60 (11.3%) to $4.70 on volume of 607m units
- Citigroup (C) +0.03 (0.9%) to $3.49 on volume of 184.4m units
- General Electric (GE) -0.11 (1%) to $11.26 on volume of 102.4m units
- Intel (INTC) +0.29 (2.1%) to $13.88 on volume of 77.1m units
- Microsoft (MSFT) +0.13 (0.7%) to $18.63 on volume of 74.4m units
Precious Metals
The Gold Bugs index (XAU) added 3.59 points (3%) to 123.44 points. Total volume traded in the 16 components of the index was 132.99m shares. Advancers outpaced decliners by 3 to one, with 12 advancers to 4 decliners. Advancing volume exceeded declining volume by 116.82m to 16.17m shares. The biggest gainers (percentage-wise) were -
- Freeport McMoran (FCX) +2.11 (8.4%) to $27.28 on volume of 36.39m shares;
- GoldCorp (GG) +1.37 (4.9%) to $29.55 on volume of 12.17m shares;
- Yamana Gold (AUY) +0.36 (4.5%) to $8.34 on volume of 18.01m shares;
- Agnico Eagle Mines (AEM) +1.75 (3.5%) to $52.45 on volume of 4.67m shares; and
- Barrick Gold (ABX) +1.23 (3.4%) to $37.08 on volume of 12.64m shares.
Energy Complex
The Oil Services index (OSX) added 4.21 points (3.38%) to 128.63 points. Total volume traded in the 15 components of the index was 99.76m shares. Not a single stock declined withinin the index: 15 of the 15 index components rose, with total upside volume of 99.76mshares. The biggest gainers (percentage-wise) were -
- National Oilwell Varco (NOV) +1.72 (6.7%) to $27.34 on volume of 10.42m shares;
- Halliburton (HAL) +1.07 (6.2%) to $18.46 on volume of 16.72m shares;
- Global Industries (GLBL) +0.19 (5.8%) to $3.47 on volume of 1.36m shares;
- Smith International (SII) +0.98 (4.5%) to $22.77 on volume of 4.04m shares; and
- BJ Services (BJS) +0.37 (3.4%) to $11.21 on volume of 8.28m shares.
Bellwethers
The nine-stock group that makes up the Rant bellwethers declined on average by 1.5%. The fallout occurred as follows:
- General Electric (GE) -0.11 (0.97%) to $11.26 on volume of 102.42m units.
- Citigroup (C) +0.03 (0.87%) to $3.49 on volume of 184.4m units.
- Wal-Mart (WMT) -1.39 (2.91%) to $46.42 on volume of 26.25m units.
- IBM (IBM) -0.65 (0.7%) to $92.83 on volume of 10.08m units.
- Intel (INTC) +0.29 (2.13%) to $13.88 on volume of 77.09m units.
- Cisco Systems (CSCO) +0.22 (1.41%) to $15.84 on volume of 87.9m units.
- Google (GOOG) +2.55 (0.75%) to $343.00 on volume of 6.78m units.
- Fannie Mae (FNM) -0.04 (7.14%) to $0.52 on volume of 13.34m units.
- Freddie Mac (FRE) -0.04 (7.14%) to $0.52 on volume of 8.63m units.
Other Indices of Interest...
The Banks index (BKX) declined 0.4 points (1.48%) to 26.65 points. Total volume traded in the 24 components of the index was 1.15bn shares. Decliners outpaced gainers by 1.6 to one, with 13 decliners to 8 advancers. Declining volume was greater than advancing volume by 890.25m to 260.13m shares. The main decliners (in percentage terms) were -
- Huntington Bancshares (HBAN) -0.37 (20.4%) to $1.44 on volume of 23.52m shares;
- Fifth Third Bancorp (FITB) -0.25 (14%) to $1.54 on volume of 29.25m shares;
- Bank Of America (BAC) -0.6 (11.3%) to $4.7 on volume of 606.92m shares;
- New M&I Corporation (MI) -0.29 (7.2%) to $3.74 on volume of 10.51m shares; and
- Regions Financial (RF) -0.11 (4.2%) to $2.5 on volume of 15.63m shares.
The Semiconductor index (SOX) added 1.92 points (0.91%) to 212.75 points. Total volume traded in the 18 components of the index was 300.49m shares. Advancers outpaced decliners by 2 to one, with 12 advancers to 6 decliners. Advancing volume exceeded declining volume by 251.1m to 49.38m shares. The biggest gainers (percentage-wise) were -
- Sandisk (SNDK) +0.63 (7.3%) to $9.29 on volume of 9.56m shares;
- Micron Technology (MU) +0.14 (3.7%) to $3.9 on volume of 26.3m shares;
- National Semiconductor (NSM) +0.35 (3.3%) to $10.89 on volume of 5.99m shares;
- Advanced Micro Devices (AMD) +0.06 (2.7%) to $2.27 on volume of 15.43m shares; and
- Texas Instruments (TXN) +0.43 (2.7%) to $16.45 on volume of 24.94m shares.
The ChildKiller ("Defence") index (DFX) dipped -0.18 points (0.07%) to 245.83 points. Total volume traded in the 17 components of the index was 137.18m shares. Decliners outpaced gainers by 1.3 to one, with 9 decliners to 7 advancers. Declining volume was greater than advancing volume by 119.91m to 17.27m shares. The main decliners (in percentage terms) were -
- Rockwell Collins (COL) -1.3 (3.3%) to $37.64 on volume of 2.88m shares;
- United Technologies (UTX) -0.78 (1.6%) to $47.53 on volume of 5.56m shares;
- Northrop Grummanl (NOC) -0.67 (1.4%) to $47.91 on volume of 2.16m shares;
- General Electric (GE) -0.11 (1%) to $11.26 on volume of 102.41m shares; and
- Alliant Tech (ATK) -0.53 (0.7%) to $80.95 on volume of 0.43m shares.
