Trading Blog: TnT Group

I mentioned this link in my webcast and it is pasted below. I wanted to say thank you to P_Ambrus on Twitter for shooting me over this link.

http://ftalphaville.ft.com/blog/2011/02/03/478326/the-ecbs-code-words/

It is a great outline of Trichet’s rhetoric and how the ECB has acted after Trichet has used specific words, including “Strong vigilance” and “Heightened alertness”.

Very interesting article so make sure and take a look at it no matter if you trade the European session or the US session.

Well the highly anticipated nonfarm payrolls number and unemployment rate came out.

A word that I think describes the majority of feelings about this number is shitty….

Let me explain:

Shitty Number 1.There was a ton of talk of a seriously higher nonfarm payrolls number. The initial estimate was for +140K but once the sizzling ADP number came out on Wednesday there was a ton of  ”market talk” increasing that number, some talks even of a +400K number! So to get a number that barely scratched +100K is well shitty. Yes, the unemployment rate went down to 9.4% from a previous 9.8% but people care about how many jobs we are adding monthly. Very very disappointing addition of jobs after such a highly optimistic number was expected. Shitty

Shitty Number 2. I made money off of the initial call of +108K, sold S&P Minis…got out as soon as the 9.4% came out. That was the bottom of the equity markets, because now people are like well 9.4% is a good number, which will lead into shitty number 3 when I get there. The point I am trying to make here is that these markets are going to be confused again on what is going on…was it a good number? Was it a bad number? Should we chop around constantly again? These two numbers are going to lead back into shitty trading markets where things are very unsure and its just back and forth.

Shitty Number 3. This doesnt affect me all that much and doesnt affect my trading much at all but it just is annoying. The talking heads on TV are now going just jabber back and forth about this number and how the 9.4% was good so lets say everything is fine. Just annoying, thats all that is really shitty about it. That is just me though.

I got out of my last trade at 7:32:51… after that 9.4% came out I kind of threw my hands in the air and thought we were just going to see a chopfest the rest of the day. I thought that was what we were going to see last night and I was wrong, so maybe I will be wrong about this too, but I don’t really want to bang my head against the wall if it does happen.

Have a good weekend everyone, and let’s hope all of this nonsense doesn’t cause shitty markets going forward.

Good morning all. I hit on this a litle bit in my webcast. I wanted to go a little more in depth about it though. When I left for vacation over the holidays I left a gold and S&P market that seemed to be somewhat correlated. To say it was a great correlation would be an absolute lie. However it seemed like gold was being traded solely as part of the commodity basket and was rising with oil, copper, rubber, etc which was also followed slowly but surely by equities and the free money that was being pumped into them.

Now after my first day back from vacation and stepping back into these markets it seemed as if there was a definite change of scenery. Overnight gold was getting hit harder than Brett Favre’s head on the frozen field in Minnesota while equities, continuing there impressive day from yesterday, gradually rose higher (as I type S&P 500 Minis are up 4.25 trading 1269.50 while gold is down 14.7 trading 1408.2). This was not a small divergence from what had been happening before I left. This was a farely large change of thought. Are people or the markets now thinking, more than we have in a while, that the economy may be on track?

Below is a daily chart showing the somewhat correlated gold and S&P markets and the slight divergence over the last few days.

The overnight session really made me think that way. We had a ton of risk on trading happening. Minis up 4.25, euro trading up 30 some pips, yen getting hit farely hard down 87 pips, debt (both US and European) down a good amount, and gold getting clobbered. Oil had a tough time doing anything overnight. I understand it. Do they want to rally it because of equities rallying and a slight sell off in the dollar or is it confused because gold is getting pounded. It eventually rallied slightly, as it should if the markets are showing signs of adding risk and the outlook being somewhat positive.

Below is a 5 minute  chart of last night session and the distinctive inverse relationship of gold and Minis.

I am not coming out and saying that our economy is back on track and let the jobs rain down from the heavens. I still whole heartedly believe we are nowhere near where we need to be. My point is to keep an eye out for this inverse type relationship as it will tell a story as to risk on or risk off trade. It is hard to deny how these markets moved last night and is something to pay close attention to moving forward into this new year.

Hello all. A lot of news happening over the weekend and over the night trading session. Make sure to take a look at the nightly webcast below and catch up on what happened. Also posted underneath this blog is both the irishtimes.com article and Ben Bernanke’s actual interview on 60 Minutes. Take a look and get caught up for the morning session. Here’s to good trading.

Mark here.

We had Initial Jobless Claims today and they came out 434K vs 450K. The number was good for stocks but the ES ( mini future) only managed to rally 2 handles and then sold off on the open.

We have the dollar lower today but the stock markets are also lower. Gold and oil are higher on the day with gold outperforming oil. My only thought is that we have people getting out of positions before this coming Tuesday and Wednesday. I can’t imagine anyone putting on new positions with two trading days left before the elections and the Fed.  There was a 7Y bond auction today and it came out good for the market. Bonds are trading there highs as i type this.

Levels I am paying attention too…….

The ES ( mini future ) has it’s 20 day moving average coming in at 1165.50. I don’t like buying it for the fact that it has moved up with the market trading sideways. I am thinking about selling the ES if we were to have a day settle below it. I still have 1134.75 and 1120.5 as good daily support.

If  the 30Y bonds (ZB) can have a daily settle below 129.05 I think the market can trade much lower.

Mark here.

Today we had CPI, Advanced Retail Sales, Empire Manufacturing, and U. of Michigan Confidence come out. All numbers except for U. of Michigan came out better than expected. We also had Ben Bernanke speak today.

The markets continue to watch and trade off the dollar. The stock markets rallied off the 7:30 numbers but quickly sold off when the dollar rallied. Commodities followed the same pattern. 30Y bonds sold off on the number and could not rally when stocks came off. With a bad auction yesterday I’m not surprised that they are week today.

Levels I am paying attention to……….

The ES ( mini future) broke through my 1160.00 resistance. The 20 day moving average is 1145.50 which should be good support first time down. I also have 1134.75 and 1120.50 as support.

Hello everyone Mark here.

We had a lot of numbers that came out today. Instead of going over them one by one I’ll save us some time and just tell you that they were all better for the stock market.

Compared to the last few weeks today has been a  little crazy. With all the good numbers we had today the stock markets got off to a good start but could not hold their gains. If your wondering why, all you have to do is look at the dollar. Since there is all this talk about QE2 stocks have been going inverse the dollar for weeks now. So today when the dollar started to rally the stock markets all sold off. The 30Y bonds sold off 1 26/32 on the number but have since retraced more than half those losses.

Levels I am paying attention to…………

Oil ( CL futures) has broken out to the upside. I’m looking for it to test its 200 day moving average at 8059. If we get a daily settle above that level and can hold above  it oil could go and test 8353.

Last week the ES (mini future) held its daily support at 1119.50 and have since made a new high above 1144.00. The only resistance I have left is 1160.00. If we get above this level my target would be the highs of the year at 1206.00. I still have 1119.50 as strong support.

Mark here.

Today we had PPI, Initial and Continuing Jobless Claims, and Philadelphia Fed for numbers. PPI ex food and energy came out as expected. Initial claims was 450k vs. an expected 459k and continuing was 4485k vs an expected 4464k. Although the revised number on continuing was much worse 4569k vs 4478k. Philadelphia fed number was -.7 vs an expected .5. These number were not good or bad enough to move the markets.

Looking at the markets there is not much going on. The Russell 2000 had been week to the S&P for most of the day. Oil is lower from yesterdays settle with the dollar not doing much all day and  30Y bonds are  25/32 lower. For the most part there is not much going today.

Levels I am paying attention to……….

The Russell 2000 ( mini future) has double topped at 652.10. A daily settle below 639.70 would target 627.30 to the downside.

A daily settle below 1110.00 in the  ES ( mini future) would target 1100.00. We have to be careful with the 200 day moving average coming in at 1103.75.

Good Luck Trading

Good afternoon everyone.  This Mark and I am back from vacation. Lets look at today’s market.

To start we had Trade Balance, Initial Jobless and Continuing claims at 7:30 this morning.  Initial Claims came out a little better 451,000 vs and expected 470,000. Continuing Claims came out a little worse 4478K vs 4450K.  Later in the day we had a 30Y bond auction. The yield came in at 3.82.

The stock markets liked the 7:30 numbers the ES (mini Futures) rallied from 1103.50 to 11120.00. I had 1107.50 ( 200 day moving average) and 1114.50 as resistance. They have since come all the way back. Bonds did not do much on the number. They sold off some but came right back. The bond auction came out at a yield of 3.82 and that made the 30Y bond sell off. They are down 16/32 since the auction.

Levels I am paying attention to………..

The ES (mini Future) is sitting near its 200 day moving average at 1107.50. If we have a daily settle above this level I think the market can trade higher. My next big level of resistance is 1129.50.

The Euro still has resistance at 129.32.  If we were to settle above this level it could make a push for 131.77 area.

Good Luck Trading