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.

Spyder here,

Mark is on vacation for the next few weeks so I will be chiming in for the days he usually writes on the markets.

Overnight seemed to look pretty tame and stayed the same early into the morning. Things seemed to really pick up around 7:00 however. To me it felt as if it was a pretty volatile session.  Jobless Claims came out +473K which was better than the expected +490K  with Continuing Claims coming at at 4456K after an expected 4495K. Now these numbers came out better than expected which the markets took positively, rallying equities to new highs. However, one of the traders that came on CNBC made a very valid point; these economists are beginning to realize the negativity within our economy and are lowering their expectations on these numbers. So a number, such as this Jobless Claims, which beat expectations, it may solely be because of the lowered expectations in the surveys that are given. Markets may have taken that to heart as equities came off the rest of the morning. S&P Minis as I am typing down 2 dollars on the day.

Taking a look at the commodity markets we had a big move up in copper even with the weakness in equities.  Oil, which once again seems to have a mind of its own most of the time, kept with that MO again today. Seemed weak when the equities were on the highs. When equities came off and went negative oil seemed to be strong. Ultimately you can make money in that market but its all about timing and if you are in it too soon you are as good as dead.

I think looking at the bigger picture you still need to be short equities. One of the risk currencies, the New Zealand Kiwi, has stayed below a daily trend and broken the 6996 level in which it needed to stay above to keep the trend higher.

With that being lower, as shown below, and the Euro/Yen Cross at the level it is at, as Brian has talked about, I think that longer term play is just to be short equities. Not to mention the unstopaBONDS where they are at!

Good luck trading!

Justin’s market overview for Wednesday….

All eyes continued to focus on the yen today. Whispers of a Japanese intervention sent the yen tumbling overnight. With nothing imminent, we saw the yen grind all the way back in the morning.

Unexpectedly, German IFO business sentiment rose to 3 yr. highs. Whereas U.S. durable goods released a number lower than forecasts. In addition, new home sales in the U.S. recorded record lows. Looks like the storm clouds in Europe have shifted over to the United States. I wouldn’t argue with anyone who would want to be short U.S. indexes against the European equivalent.

The rubber band is being stretched right now. When will it snap?

levels i am looking at……

short 1054 then 1075 with a final short at 1096 in the s&p minis. above there,  i am done trading from the short side.

the downside looks ugly in the minis, with a possible hiccup at 1017.5 to stop the bleeding.

long 13517 and 13500 in the u.s. 30 yr. bonds

long 12511 in the u.s. 10 yr. notes

long 116 58 in the yen

It’s not a question of enough, pal. It’s a zero sum game, somebody wins, somebody loses. Money itself isn’t lost or made, it’s simply transferred from one perception to another. – Gordon Gekko

This is Brian Tehako giving you my daily blog on the market.

I want to Thank Andy Turner for taking over my blog yesterday.  His blog was short and sweet…. But right to the point that leads right into my blog

The EURO/ YEN.  Holy crap did it get hammered overnight and continued through the early morning.  Being a macro trader I believe in the movement in money moves all markets.  This shift of money is unreal in the Euro/Yen.  In my trading career I have not seen the Euro/Yen in these areas it made this morning.

Yesterdays settle was 912 in the Euro/Yen.  It made a low today of 646.  With these levels here and we did make a nice bounce back above 800, but these equity markets could see a 10% drop easy, 20% probable, and maybe even back to our lows from 09/10.  I know this seems crazy…… But I still believe that the currency moves started the FLASH CRASH….. If  so……. We will BREAK HARD!!!

One thing I also noticed today that was very strange was the metal sectors.  Silver was really strong on the bounce in equities.  Silver was strong, then Gold, and Copper was really weak.  Keep one eye on that Silver in these moves…. Gold should stay stronger…. If it doesn’t, you may want to start bottom feeding on these equities.  It happened today and worked.

EXISTING HOME SALES……….. OHHHHHHH BOY…… IT WAS BAD!!!!!

We were looking for 4.65M and -13.4%.  It came out 3.83M and -27.2%.  You cant get much worse(15 year lows).  Equities hammered and debt continued it’s extreme BULL market.

Richmond Fed came out suprisingly a little better.  We were looking for 8, and it came out at 11.  That took me for a little bit of a surprise, but it is such a small number.

Going into the close today:

DON’T BUCK THE TREND.

Stay short equities

Stay long debt

THE TREND IS YOUR FRIEND.

Check out my live spot today on Fox Business News around 2:10 Central Time.

Remember…… No drinking and Trading!!!

Andy Turner here on a Monday.

The dollar is looking to hold onto the gains it made late Friday in after hours trading.  Although stock index futures were higher going into the open, those gains were quickly erased.

Oil gave some signs of life too but finally rolled over with the dollar holding the 83 even area.

I wanted to see the S&P mini test the 1103 area last week but it doesn’t look like that is in the works anymore.  Add in the fact that the Euro/Yen cross looked  like it would test the lows made in June today, it makes me think this is a very sick market and we will be testing the aforementioned 1050 before 1103 trades again.