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Not as Bad as It Looks 4/2/20

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19 minutes ago, sandy beach said:

Everyone knew the unemployment numbers would be the bad. I agree that was "priced in." But that's the tip of the iceberg of the bad news coming. I'm still thinking we'll have a waterfall Monday morning and eventually retest the lows. Sometime over the next month plus in quarantine people are going to get shocked by the death count, infected family members, friends, coworkers & neighbors, junk bond defaults, downgrades, bankruptcies, out of business signs, etc. And who knows what is going to happen in the EM space or even in the developed world. This is not the bottom. But if we do make it back up to the 50 fibo it'll be time to unload longs and reload shorts. 

People would have to be REALY dumb not to be able to anticipate what comes next. Even the biggest dickhead knows that when there are 10 million jobless within two weeks something isn't right with "the economy" The effects will be horrible, yes, maybe some is not "priced in" yet, but most of it is. We would have to wait for the "second round" effects. FED and the Gov try to prevent the second round. Will they succeed? Hard to say. Normally almost impossible. But what is normal these days?

I am not comfortable with the 50 fibo. We should not break above the 38. This Corona thing is such a MEGA global shock we should be lower already. A move to the 50 would mean "life is good and bright", but how can that be under such circumstances?

The move to the 38 should have been the last chance to get out before this whole thing breaks totally apart.

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ZH demonstrates the fact that alternative views of monetary matters have been deeply entwined with American right wing ideology, or just simply prejudices, since the 1950's when the John Birch society

The margin man coming round again. Other than that, the money the Fed is pumping in should keep the system afloat. You're wasting your time thinking of "reasons." Utter waste of time. It's always and

Found it Sip - thanks! https://economictimes.indiatimes.com/news/international/world-news/help-us-like-you-were-helped-after-war-italys-virus-hit-cities-tell-germany/articleshow/74913288.cms

What it boils down to is that the market is trapped between shport and rayseestonce. 

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30 minutes ago, fxfox said:

that monster spike in oil was only due to a tweet from Trumpinski, where he said that he "hopes" and "believes" that the Saudis and Russians agree to a 10 million barrel cut.

My gawd, both even didn't talk with each other yet!

to be known at this point forward as Donald Pump

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Again. This is not about the COVID. It's about an overblown, brittle paper thin bubble that is disintegrating before our eyes. COVID was just the fault crack that triggered the collapse. A system without excessive leverage would have weathered this. 

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8 minutes ago, DrStool said:

Again. This is not about the COVID. It's about an overblown, brittle paper thin bubble that is disintegrating before our eyes. COVID was just the fault crack that triggered the collapse. A system without excessive leverage would have weathered this. 

Yes ok, agreed. But don't you think that a good part of de-leveraging is already done. I mean, if we would only be in the early stages of de-leveraging now, that would mean that the S&P would finally go to lets say 333 (I choose 333 because we already had 666 as a final low in 2009 :lol: ). Because in that case it would mean that definitely SOME (not only one or o) major banks would blow up.

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Who wants to touch the derivatives portfolio of Deutsche Bank? Caution: Toxic :lol:

A former KPMG guy once told me: "Nobody knows what's really in that portfolio, not even DB itself." :ninja::rolleyes::P

I think if Germany would nationalize Deutsche the whole state would blow up :lol::lol::lol:

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27 minutes ago, fxfox said:

Yes ok, agreed. But don't you think that a good part of de-leveraging is already done. I mean, if we would only be in the early stages of de-leveraging now, that would mean that the S&P would finally go to lets say 333 (I choose 333 because we already had 666 as a final low in 2009 :lol: ). Because in that case it would mean that definitely SOME (not only one or o) major banks would blow up.

They already have blown up. 

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57 minutes ago, fxfox said:

Could you please elaborate on that a bit further? I know that Sonette tried to predict bubbles, but I do not really get your point here.

I mean these sort of chart patterns are what you see in log-periodic power law just after hitting a singularity. After looking at these patterns in previous bubbles I have feel for them. I don't mean they replace my normal trading tools like support / resistance, stochastic, trend-lines, etc. But after a singularity you can visually see certain patterns to overlay these other tools which is why when we got up to the 38 fibo I predicted were were going right back down. It is no different than the way some traders use Elliott Wave Counts to visualize market direction changes on top of basic technical analysis. Everyone here could have also looked at fibos and moving averages and come to the same conclusion. I find his work applies just before and after a singularity. It doesn't do well in predicting the actual final bottom or during long dull normal periods in the market. Everyone uses a different tool kit.  

didier sornette.png

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3 minutes ago, DrStool said:

The Fed has pumped a trillion into them because they blew up. 

ok, but what should bring the market than down? A global demand shock of epic proportions I would say. Likely?

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7 minutes ago, fxfox said:

ok, but what should bring the market than down? A global demand shock of epic proportions I would say. Likely?

Cascading effects. We still have a lot of smaller entities that are unstable and they will temporarily default on larger entities. And I'm sure there are a lot of bankruptcies yet to be announced. The world is built on "just in time finance" and some of that won't survive even a two month hiatus if they use up their revolving credit and the banks don't want to get involved. 

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26 minutes ago, fxfox said:

ok, but what should bring the market than down? A global demand shock of epic proportions I would say. Likely?

The margin man coming round again. Other than that, the money the Fed is pumping in should keep the system afloat. You're wasting your time thinking of "reasons." Utter waste of time. It's always and forever only about one thing. 

The money.  Everything else is a sideshow. 

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