To Uptrend, or Not to Uptrend, That is the Querstion 9/8/22

[fxfox]

19 minutes ago, potatohead said:

Lee,any thoughts? could all this  hedging force weak shorts out and rally the market. .You have always said the shorts are their own worst enemy.

 

That chart is from Sentimenttrader. He didn‘t adjust the data to overall market volume, which is much higher today than in 2008.
 

It is like with the old „household income“ trick: If you want to make the case that people get poorer and poorer than you simply use household income and compare 2022 with 1962 or whatever. The households per capita have increased significantly since then, so the household income per capita decreases: 10 folks, 1 household, household income 500, compared to 10 folks, 5 households, average household income 100.

So what Sentimenttrader does is comparing Apples with Oranges.

[Jorma]

So VIX is down a couple of percent today? Okee Dokee.

[Jimi]

14 minutes ago, sandy beach said:

Federal Funds Rate vs. S&P 500

https://en.macromicro.me/collections/9/us-market-relative/91/interest-rate-sp500

Bingo!

So, the chart I saw observed that the average time between peak-rate hike to low-on-the-S&P was ~20 months, or something like that... and if you consider that we are still in the hiking stage of uncertain duration with the peak "somewhere up there ahead," that it's bravely naive to think that we are anywhere near any bottom in equities.

Eyeballing your data....

2.42 peak in 4/2019 ==> Subsequent equity low 3/2020

5.25 peak in 3/2007 ==> 4/2009

6.54 in 7/1999 ==> 10/2002

[DrStool]

1 hour ago, potatohead said:

Lee,any thoughts? could all this  hedging force weak shorts out and rally the market. .You have always said the shorts are their own worst enemy.

 

not true. I said that the shorts are their own worst enema.

 

😄😄😄

[DrStool]

1 hour ago, fxfox said:

That chart is from Sentimenttrader. He didn‘t adjust the data to overall market volume, which is much higher today than in 2008.
 

It is like with the old „household income“ trick: If you want to make the case that people get poorer and poorer than you simply use household income and compare 2022 with 1962 or whatever. The households per capita have increased significantly since then, so the household income per capita decreases: 10 folks, 1 household, household income 500, compared to 10 folks, 5 households, average household income 100.

So what Sentimenttrader does is comparing Apples with Oranges.

Well that would true it would be correct but actually average household size has fallen, has it not?

[sandy beach]

56 minutes ago, Jimi said:

Bingo!

So, the chart I saw observed that the average time between peak-rate hike to low-on-the-S&P was ~20 months, or something like that... and if you consider that we are still in the hiking stage of uncertain duration with the peak "somewhere up there ahead," that it's bravely naive to think that we are anywhere near any bottom in equities.

Eyeballing your data....

2.42 peak in 4/2019 ==> Subsequent equity low 3/2020

5.25 peak in 3/2007 ==> 4/2009

6.54 in 7/1999 ==> 10/2002

That's for quantifying this!

[DrStool]

1 minute ago, DrStool said:

Well that would true it would be correct but actually average household size has fallen, has it not?

The timing of the bottom has nothing to do with rates. Rates are red herring. it's about Q of M.

[sandy beach]

12 minutes ago, DrStool said:

The timing of the bottom has nothing to do with rates. Rates are red herring. it's about Q of M.

But the Fed just said this morning that Q of M no longer matters!

 

<duck> <run> 😂

[DrStool]

13 minutes ago, DrStool said:

The timing of the bottom has nothing to do with rates. Rates are red herring. it's about Q of M.

although when the Fed starts easing rates you should start falling. I think in the year of quantitative tightening and quantitative easing the effects will be almost immediate both in terms of stock prices and interest rates. so in the old days there may have been a lag but in the last couple of cycles, not. 

[DrStool]

1 minute ago, sandy beach said:

But the Fed just said this morning that Q of M no longer matters!

 

<duck> <run> 😂

exactly! It's called gaslighting! 

[DrStool]

Just now, DrStool said:

exactly! It's called gaslighting!

Powell knows that he is lying. 😊

[DrStool]

Just now, DrStool said:

Powell knows that he is lying. 😊

anyone who gets to be Fed Chair gets there because they are masters in CYA

[fxfox]

27 minutes ago, DrStool said:

Well that would true it would be correct but actually average household size has fallen, has it not?

Yes it has.

My point was only: There are statistics where they don‘t show per capita numbers but only household income as such and that is misleading in an age where total numbers of households have increased massively.

[BartTheBear]

I've never seen a down market with such a BTD mentality. Is it all the diaper clad retail investors who've never seen a real bear market? (COVID crash not included).

[DrStool]

Based on this,

3 hours ago, potatohead said:

Lee,any thoughts? could all this  hedging force weak shorts out and rally the market. .You have always said the shorts are their own worst enemy.

 

And this:

Special Bulletin – T-Bill Paydown

the market is set up for an epic short squeeze that could lead to the biggest rally of the bear market. It will convince everybody, not just the majority, that a new bull is under way. I expect to see all my shorts stopped out on the trailing stops, and some long picks to be added the list.  https://liquiditytrader.com/index.php/2022/09/05/swing-trade-screens-13-picks-all-shorts-all-winners/