Monday, November 29, 2010

On Conventional Wisdom

“… it is the long-term investor … who will in practice come in for most criticism wherever investment funds are managed by committees or boards or banks. For it is the essence of his behavior that he should be eccentric, unconventional and rash in the eyes of average opinion. If he is successful, that will only confirm the general belief in his rashness; and if in the short run he is unsuccessful, which is very likely, he will not receive much mercy. Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.”

Source: John Maynard Keynes via Investment Postcards

Saturday, November 13, 2010

Behavioral Investment Tips

Top tips for better decision making

This applies to me, you and everyone else.

You know less than you think you do.

Be less certain in your views, aim for timid forecast and bold choices.

Don’t get hung up on one technique tool, approach or view – flexibility and pragmatism are the order of the day.

Listen to those who don’t agree with you.

Top tips for better decisions

You didn’t know it all along, you just think you did. Forget relative valuation, forget market prices, work out what the stock is worth (use reverse DCFs).

Don’t take information at face value, think carefully about how it was presented to you.

Don’t confuse good firms with good investments, or good earnings growth with good returns.

Vivid, easy to recall events are less likely than you think they are, subtle causes are underestimated.

Try to focus on facts, not stories.

Sell your losers and ride your winners.

Beating the biases

Being aware of the biases is not enough. It is just an important first step.

Need to create a framework that incorporates mental best practice. Easier said than done. Mental bad habits are persistent.

The good news, we continue to create new brain cells throughout our lives.

Wednesday, November 10, 2010

Market Wizard Quote of the Day

Michael Marcus taught me one other thing that is absolutely critical: You have to be willing to make mistakes regularly; there is nothing wrong with it. Michael taught me about making your best judgment, being wrong, making your next best judgment, being wrong, making your third best judgment, and then doubling your money.

Whenever I enter a position, I have a predetermined stop. That is the only way I can sleep. I know where I'm getting out before I get in. The position size on a trade is determined by the stop, and the stop is determined on a technical basis. I never think about other people who may be using the same stop, because the market shouldn't go there if I am right.

Place your stops at a point that, if reached, will reasonably indicate that the trade is wrong, not at a point determined primarily by the maximum dollar amount you are willing to lose.

If you personalize losses, you can't trade.”

Bruce Kovner

Sunday, November 07, 2010

Market Wizard Quote of the Day

"Taking advantage of potential major winning trades is not only important to the mental health of the trader but is also critical to winning. Letting winners ride is every bit as important as cutting losses short. If you don't stay with your winners, you are not going to be able to pay for the losers.

In addition to not overtrading, it is important to commit to an exit point on every trade. Protective stops are very important because they force this commitment on the trader."

Michael Marcus

Wednesday, November 03, 2010

The Night of the living Fed

Today is the important FED announcement day when "Big Ben" is expected to give details of the QE2. Jeremy Grantham, the chief investment strategist of Boston-based GMO has just published the October edition of his quarterly newsletter entitled “Night of the living Fed”. In this report, Grantham’s outlines what he believes to be the disastrous effects that the policies of the Fed, under the direction of both Alan Greenspan and Ben Bernanke, have had on the U.S. and global economies.

Bellow we have Prieur du Plessis summary of Grantham’s attack:

1) Long-term data suggests that higher debt levels are not correlated with higher GDP growth rates.

2) Therefore, lowering rates to encourage more debt is useless at the second derivative level.

3) Lower rates, however, certainly do encourage speculation in markets and produce higher-priced and therefore less rewarding investments, which tilt markets toward the speculative end. Sustained higher prices mislead consumers and budgets alike.

4) Our new Presidential Cycle data also shows no measurable economic benefits in Year 3, yet point to a striking market and speculative stock effect. This effect goes back to FDR, and is felt all around the world.

5) It seems certain that the Fed is aware that low rates and moral hazard encourage higher asset prices and increased speculation, and that higher asset prices have a beneficial short-term impact on the economy, mainly through the wealth effect. It is also probable that the Fed knows that the other direct effects of monetary policy on the economy are negligible.

6) It seems certain that the Fed uses this type of stimulus to help the recovery from even mild recessions, which might be healthier in the long-term for the economy to accept.

7) The Fed, both now and under Greenspan, expressed no concern with the later stages of investment bubbles. This sets up a much-increased probability of bubbles forming and breaking, always dangerous events. Even as much of the rest of the world expresses concern with asset bubbles, Bernanke expresses none. (Yellen to the rescue?)

8) The economic stimulus of higher asset prices, mild in the case of stocks and intense in the case of houses, is in any case all given back with interest as bubbles break and even overcorrect, causing intense financial and economic pain.

9) Persistently over-stimulated asset prices seduce states, municipalities, endowments, and pension funds into assuming unrealistic return assumptions, which can and have caused financial crises as asset prices revert back to replacement cost or below.

10) Artificially high asset prices also encourage misallocation of resources, as epitomized in the dotcom and fiber optic cable booms of 1999, and the overbuilding of houses from 2005 through 2007.

11) Housing is much more dangerous to mess with than stocks, as houses are more broadly owned, more easily borrowed against, and seen as a more stable asset. Consequently, the wealth effect is greater.

12) More importantly, house prices, unlike equities, have a direct effect on the economy by stimulating overbuilding. By 2007, overbuilding employed about 1 million additional, mostly lightly skilled, people, not counting the associated stimulus from housing-related purchases.

13) This increment of employment probably masked a structural increase in unemployment between 2002 and 2007, which was likely caused by global trade developments. With the housing bust, construction fell below normal and revealed this large increment in structural unemployment. Since these particular jobs may not come back, even in 10 years, this problem may call for retraining or special incentives.

14) Housing busts also help to partly freeze the movement of labor; people are reluctant to move if they have negative house equity. The lesson here is: Do not mess with housing!

15) Lower rates always transfer wealth from retirees (debt owners) to corporations (debt for expansion, theoretically) and the financial industry. This time, there are more retirees and the pain is greater, and corporations are notably avoiding capital spending and, therefore, the benefits are reduced. It is likely that there is no net benefit to artificially low rates.

16) Quantitative easing is likely to turn out to be an even more desperate maneuver than the typical low rate policy. Importantly, by increasing inflation fears, this easing has sent the dollar down and commodity prices up.

17) Weakening the dollar and being seen as certain to do that increases the chances of currency friction, which could spiral out of control.

18) In almost every respect, adhering to a policy of low rates, employing quantitative easing, deliberately stimulating asset prices, ignoring the consequences of bubbles breaking, and displaying a complete refusal to learn from experience has left Fed policy as a large net negative to the production of a healthy, stable economy with strong employment.

Friday, October 29, 2010

Disconnect: Wall Street - Main Street in US

Interesting to notice the recent break in the correlation between the Consumer Confidence and the S&P500 in US. The two indicators should go together in normal times..and at some point they will probably recorrelate..either by rising consumer confidence or by a fall in the S&P500.

Source: The Big Picture

Saturday, October 16, 2010

Jesse Livermore's Trading Rules

Lesson Number One: Cut your losses quickly.

As soon as a trade is contemplated, a trader must know at what point in time he'll be proven wrong and exit a position. If a trader doesn't know his exit before he takes the entry, he might as well go to the racetrack or casino where at least the odds can be quantified.

Lesson Number Two: Confirm your judgment before going all in.

Livermore was famous for throwing out a small position and waiting for his thesis to be confirmed. Once the stock was traveling in the direction he desired, Livermore would pile on rapidly to maximize the returns.

There are several ways to buy more in a winning position — pyramiding up, buying in thirds at predetermined prices, being 100% in no more than 5% above the initial entry — but the take home is to buy in the direction of your winning trade – never when it goes against you.

Lesson Number Three: Watch leading stocks for the best action.

Livermore knew that trending issues were where the big money would be made, and to fight this reality was a loser's game.

Lesson Number Four: Let profits ride until price action dictates otherwise.

"It never was my thinking that made the big money for me. It always was my sitting."

One method that satisfies the desire for profit and subdues the fear of a losing trade is to take one half of your profit off at a predetermined level, put a stop at breakeven on the rest, and let it play out without micromanaging the position.

Lesson Number Five: Buy all-time new highs.

The psychological merits of buying all-time or 52-week highs are immense and shouldn't be discounted as a part of your overall strategy.

Lesson Number Six: Use pivot points to determine trends.

When going long, traders are continually looking for confirmation by assessing the strength of a move. Higher highs and higher lows are a solid indicator that a current uptrend is merely taking a slight pause, and the odds of higher prices are in their favor. These same pivot points are integral to drawing support and resistance lines to give traders their line in the sand. Taken together, trend lines and pivot points can enlighten a trader to a change in momentum, which may change the character of a trade.

Lesson Number Seven: Control your emotions.

Our goal as traders should be to also make a critical yet honest assessment of the areas we can improve so the bottom line will support our claims of truly being seasoned traders. Adhering to the time-tested rules of Jesse Livermore would be a great start for anyone.

Friday, October 15, 2010

Small Caps Vs Large Caps in US

In the chart above we have the daily S&P500 (top) and the daily inverted S&P500 relative to the US small cap stocks index Russell 2000 Index (bottom). We notice that usually a relative strength of the small cap stocks is supportive for the uptrend of the large caps (blue chips) in the S&P as a sign of more risk taking in the markets. Since we have no divergence of the trends of both charts above, the uptrend in S&P seems to be healthy and poised to continue.

An example of a serious divergence we have in the same charts below but on weekly time frame. The uptrend in the relative strength of the small stocks ended in July 2006 and started trending down while the blue chips in S&P500 continued north in strong uptrend until January 2008. The underperformance of small stocks was an early important warning sign of the later strong reversal of the S&P500.


Thursday, October 14, 2010

Chart of the Day - DAX Index

The German DAX Index registered a breakout to the upside yesterday with a breakaway gap from an ascending triangle or a rectangle. The potential target price area is between around 6900 (computed from breaking out of the rectangle) and 7200 (computed from breaking out of the ascending triangle).

Wednesday, October 13, 2010

Chart of the Day - CRB Index

CRB Index has just reached a two year high and the trend is poised to continue longer term unless quickly turns down. We have a weekly chart above that indicates a potential target for the bullish run in the 320 - 340 area during the next several months. The trend is supported by the weakening dollar and by the Fed efforts to fight deflation through inducing inflation expectations via commodities.

The CRB Index has the following composition: Crude Oil (23%), Aluminum (6%), Copper (6%), Corn (6%), Gold (6%), Live cattle (6%), Natural Gas (6%), Soy beans (6%)Cocoa (5%), Coffee (5%), Cotton (5%), Heating oil (5%), Sugar (5%), Unleaded Gas (5%), Lean Hogs (1%), Nickel (1%), Orange juice (1%), Silver (1%), Wheat (1%)

Tuesday, October 12, 2010

Chart of the Day - US 10-year Treasury Note

As noticed in the weekly chart above, the US 10-year Treasury Note is in a strong downtrend triggered by the weekly SMA200 and 34-week time cycle. This technical setup was supported by Fed bond purchases - or the Fed actions were supported by this technical setup:) - to push longer term yields lower in order to underpin economic growth.

Monday, October 11, 2010

Chart of the Day - MSCI Emerging Markets

MSCI Emerging Markets is trending up but an important price and time confluence might be strong resistance to pass.

In the chart below we see the relative performance of S&P500 against MSCI Emerging Markets. The strong downtrend since 2001 was briefly interrupted in 2008 but resumed shortly after showing continued strong emerging markets overperformance.

Sunday, October 10, 2010

Bob Farrell’s 10 Market Rules to Remember

Wall Street “gurus” come and go, but in the case of Bob Farrell legendary status was achieved. He spent several decades as chief stock market analyst at Merrill Lynch & Co. and had a front-row seat at the go-go markets of the late 1960s, mid-1980s and late 1990s, the brutal bear market of 1973-74, and October 1987 crash.

Farrell retired in 1992, but his famous “10 Market Rules to Remember” have lived on and are summarized below. The words of wisdom are timeless and are especially appropriate as investors grapple with the difficult juncture at which stock markets find themselves at this stage.

1. Markets tend to return to the mean over time
When stocks go too far in one direction, they come back. Euphoria and pessimism can cloud people’s heads. It’s easy to get caught up in the heat of the moment and lose perspective.

2. Excesses in one direction will lead to an excess in the opposite direction
Think of the market baseline as attached to a rubber string. Any action too far in one direction not only brings you back to the baseline, but leads to an overshoot in the opposite direction.

3. There are no new eras – excesses are never permanent
Whatever the latest hot sector is, it eventually overheats, mean reverts, and then overshoots. Look at how far the emerging markets and BRIC nations ran over the past six years, only to get cut in half. As the fever builds, a chorus of “this time it’s different” will be heard, even if those exact words are never used. And of course, it – human nature – is never different.

4. Exponential rapidly rising or falling markets usually go further than you think, but they do not correct by going sideways
Regardless of how hot a sector is, don’t expect a plateau to work off the excesses. Profits are locked in by selling, and that invariably leads to a significant correction eventually.

5. The public buys the most at the top and the least at the bottom
That’s why contrarian-minded investors can make good money if they follow the sentiment indicators and have good timing. Watch Investors Intelligence (measuring the mood of more than 100 investment newsletter writers) and the American Association of Individual Investors Survey.

6. Fear and greed are stronger than long-term resolve
Investors can be their own worst enemy, particularly when emotions take hold. Gains “make us exuberant; they enhance well-being and promote optimism”, says Santa Clara University finance professor Meir Statman. His studies of investor behavior show that “Losses bring sadness, disgust, fear, regret. Fear increases the sense of risk and some react by shunning stocks.”

7. Markets are strongest when they are broad and weakest when they narrow to a handful of blue-chip names
This is why breadth and volume are so important. Think of it as strength in numbers. Broad momentum is hard to stop, Farrell observes. Watch for when momentum channels into a small number of stocks.

8. Bear markets have three stages – sharp down, reflexive rebound and a drawn-out fundamental downtrend
I would suggest that as of August 2008, we are on our third reflexive rebound – the January rate cuts, the Bear Stearns low in March, and now the Fannie/Freddie rescue lows of July.
We have yet to see the long-drawn-out fundamental portion of the bear market.

9. When all the experts and forecasts agree – something else is going to happen
As Stovall, the S&P investment strategist, puts it: “If everybody’s optimistic, who is left to buy? If everybody’s pessimistic, who’s left to sell?” Going against the herd as Farrell repeatedly suggests can be very profitable, especially for patient buyers who raise cash from frothy markets and reinvest it when sentiment is darkest.

10. Bull markets are more fun than bear markets
Especially if you are long only or mandated to be fully invested. Those with more flexible charters might squeak out a smile or two here and there.

Friday, October 08, 2010

Market Wizard Quote of the Day

“Don’t think about what the market’s going to do; you have absolutely no control over that. Think about what you’re going to do if it gets there. In particular, you should spend no time at all thinking about those rosy scenarios in which the market goes your way, since in those situations, there’s nothing more for you to do. Focus instead on those things you want least to happen and on what your response will be".

The GOLDen Route Update

Gold followed its bullish route I mentioned one year ago on 17th of October 2009 in a post entitled "GOLDen Fibonacci Uptrend". The post included the chart above with the following price and time targets: "1250 (161.8% Fibonacci projection) then around 1400 (the 200% projection) and 1600 (261.8% Fibonacci projection). We also have the 34-week cycles in April 2010 and November - December 2010 when we may record new highs around the levels above or just inflection areas."

Below we have the updated chart where we notice that the first target (1250) was reached in May 2010 a month later than its cycle time while the second target (1400) is supposed to be reached in November - December 2010 but it's close already today on 8th of October (when registered a high just shy of 1365). In a later post I will discuss more on the potential price and time targets of Gold.

Thursday, October 07, 2010

Chart of the Day - S&P500

S&P500 reached a confluence of an upper side channel resistance and a 21-day cycle. With the potential volatility of the NFP news tomorrow we may be able to check if the next short term trend is stil up or turns down.

Wednesday, October 06, 2010

The most signicant lesson Soros taught Druckenmiller

The most signicant lesson Soros taught him, Druckenmiller suggested, was “that it’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong. The few times that Soros has ever criticized me was when I was really right on a market and didn’t maximize the opportunity.”

He learned this soon after he began work at Quantum. He had been unenthusiastic about the dollar and he took a large short position against the German mark. The position began to go in his favor, and he was quite pleased with himself. Soros dropped in on him in his ofce and discussed the trade.

“How big a position do you have?” he asked.

“One billion dollars,” Druckenmiller answered.

“You call that a position?” Soros said, a question that has become part of Wall Street folklore.

Soros suggested that Druckenmiller double his position. He did. And, just as Soros had predicted, even more prots poured into Quantum.

“Soros has taught me,” noted Druckenmiller, “that when you have tremendous conviction on a trade, you have to go for the jugular. It takes courage to be a pig. It takes courage to ride a prot with huge leverage. As far as Soros is concerned, when you’re right on something, you can’t own enough.”

Source: SOROS - The Unauthorized Biography, Robert Slater

Tuesday, October 05, 2010

FX Chart of the Day - EURGBP

The area around 0.8750 seems an obviuos target for now..the strong trend in EURGBP is the reason behind GBPUSD underperformance against EURUSD.

Monday, October 04, 2010

Chart of the Day - ELMA

Graficul saptamanal de mai sus indica potentiale targeturi zonele 0.80 - 0.82 si apoi 0.95 - 1.00 pana in luna decembrie 2010.

Sunday, October 03, 2010

Black Swan vs Black Duck

“The trouble with the Recency Effect is that everyone all of a sudden thought they were Nassim Taleb, orinthological experts on the spotting of Black Swans. Every blip on the screen or blurb in the newspaper was fresh evidence of the next hundred years’ storm. Forget being fooled by randomness, people have become obsessed with randomness.

But as we’ve learned, not every aberration is a Black Swan in the making. Sometimes, it’s just an ordinary Black Duck. A negative event or possibility that is processed and dealt with, that doesn’t necessarily lead to contagion, panic and meltdown.”

Source: The Reformed Broker - Sometimes It’s Just a Black Duck

Dow at 38 820 in 2025?

That’s what Jeffrey Hirsch’s Stock Trader’s Almanac predicts:

“As markets and economies struggle over the next several years, remember to keep your eye on the future and get ready for the Next Super Boom and the next 500% move in the market. From the last bottom in 1974 it took eight years before the market really took off in 1982 and then another eight to move up the rest of the 500%, in line with Yale Hirsch’s prediction in 1976 for a 500% market move by 1990. A 500% rise in the Dow over 16 years from the intraday low of 6470 on March 6, 2009 would put the Dow at 38,820 in 2025.”

War followed by Inflation, Peace and Secular Bull Market Gains


Stock Trader’s Almanac: Next Super Boom — Dow 38820 By 2025 — Stocks Catch Up With Inflation, But First Inflation Catches Up With Government Spending

Saturday, October 02, 2010

The Speculator As Hero

Victor Niederhoffer on speculation:

“I am a speculator. I own seats on the Chicago Board of Trade and Chicago Mercantile Exchange. When my daughters ask me if my job is as important as the butcher's, the doctor's or the scientist's, I answer that the speculator is a hero, and has been throughout history.

Some speculators are discoverers like Christopher Columbus, creators like Henry Ford, or inventors like Thomas Edison. Their job is easy to place on a high plane. My role in the grander order is indirect, relatively invisible and unplanned. The only discoveries I make are the routes that prices will travel. Like hundreds of thousands of other traders, I try to predict the prices of common goods a day or two in the future. If I think the price of an item will go up, I buy today and sell later. If I think that the price is going down, I'll sell at today's higher price. The miracle is that in taking care of ourselves, we speculators somehow ensure that producers all over the world will provide the right quantity and quality of goods at the proper time, without undue waste, and that this meshes with what people want and the money they have available.


Let's consider some of the principles that explain the causes of shortages and surpluses and the role of speculators.

When a harvest is too small to satisfy consumption at its normal rate, speculators come in, hoping to profit from the scarcity by buying. Their purchases raise the price, thereby checking consumption so that the smaller supply will last longer. Producers encouraged by the high price further lessen the scarcity by growing or importing more. On the other side, when the price is higher than the speculators think the facts warrant, they sell. This reduces prices, encouraging consumption and exports and helping to reduce the surplus.


I am proud to be a speculator. I am proud that my humble attempts to predict Tuesday's prices on Monday are an indispensable component of our society. By buying low and selling high, I create harmony and freedom.”

Source: The Speculator As Hero

Friday, October 01, 2010

Indecision in continental Europe..

DAX - still in range

CAC - still testing FIB 61.8% retracement

ATX - still testing FIB 61.8% retracement

Wednesday, September 29, 2010

Daca BETFI trece de 24.000 puncte.. evadeaza din triunghiul ascendent, urmatoarele praguri de rezistenta vor fi 26.500, 28.000 si 30.000 puncte. Se observa in graficul saptamanal de mai jos ca dupa retragerea de 61.8% a trendului ascendent inceput in 2009 indicele revine incet pe crestere si intampina rezistenta la EMA50 care se afla in jurul valorii de 24.000 puncte..

Tuesday, September 28, 2010

End of journey for AUDUSD?

Looks like the area around 0.97 might be end of journey for Australian dollar for now..and since we have around 93% correlation between AUDUSD and S&P500, what can we expect from US equity market?

Six Rules of Michael Steinhardt

Michael Steinhardt was one of the most successful hedge fund managers of all time. A dollar invested with Steinhardt Partners LP in 1967 was worth $481 when Steinhardt retired in 1995.

The following six rules were pulled out from a speech he gave:

1. Make all your mistakes early in life: The more tough lessons you learn early on, the fewer (bigger) errors you make later. A common mistake of all young investors is to be too trusting with brokers, analysts, and newsletters who are trying to sell you something.

2. Always make your living doing something you enjoy: Devote your full intensity for success over the long-term.

3. Be intellectually competitive: Do constant research on subjects that make you money. Plow through the data so as to be able to sense a major change coming in the macro situation.

4. Make good decisions even with incomplete information: Investors never have all the data they need before they put their money at risk. Investing is all about decision-making with imperfect information. You will never have all the info you need. What matters is what you do with the information you have. Do your homework and focus on the facts that matter most in any investing situation.

5. Always trust your intuition: Intuition is more than just a hunch — it resembles a hidden supercomputer in the mind that you’re not even aware is there. It can help you do the right thing at the right time if you give it a chance. Over time, your own trading experience will help develop your intuition so that major pitfalls can be avoided.

6. Don’t make small investments: You only have so much time and energy so when you put your money in play. So, if you’re going to put money at risk, make sure the reward is high enough to justify it.

Source: Six Rules of Michael Steinhardt

Monday, September 27, 2010

Potential target pentru SIF5..

..este zona 1.60 - 1.65 pe termen scurt, daca se va inregistra un breakout peste rezistenta din 1.48 - 1.50 pe volume in crestere. Strapungerea ferma a SMA200 si a laturii orizontale a triunghiului ascendent (care are implicatii bullish in general) dar si o numaratoare fortata de valuri Elliot care ne-ar plasa in valul impulsiv 5 cresc probabilitatea atingerii targetului mentionat aflat la confluenta unei retrageri si a unei proiectii Fibonacci. In caz contrar, linia de uptrend este aproape si ruperea acesteia probabil va intoarce actiunea in range. Vom vedea..

Thursday, September 23, 2010

Potential EURUSD Elliot Trip

We may be in the 3rd wave or at the beginning of the corrective 4th wave of the bigger impulse 3rd wave (III) that may take EURUSD to around 1.39 - 1.40 during the next weeks. Where are the US$ lovers?

Sunday, April 25, 2010

Update Analiza BETFI

BETFI Weekly Chart 22-11-2009

BETFI Weekly Chart 25-04-2010

Mai sus se afla graficul saptamanal al indicelui BETFI (scara logaritmica) cu evolutia anticipata a acestuia de la ultima analiza din 22-11-2009 pana in prezent si un scenariu de continuare in viitor. Se observa ca trendul ascendent al BETFI a intampinat rezistenta in luna februarie 2010 in zona de 30.000 de puncte si apoi s-a atins obiectivul de pret din zona aflata intre 30.000 si 34.000 puncte. Ulterior a inceput o corectie saptamanala aflata in desfasurare.
Indicele BETFI se inscrie momentan intr-un trend minor descendent. Trendul intermediar este in continuare ascendent si poate fi pus in pericol daca indicele va cobori sub media exponentiala de 20 saptamani (momentan zona de 29.000 puncte).

Avand in vedere rezistenta puternica din zona dintre 30.000 si 34.000 puncte, putem emite ipoteza unei retrageri mai ample din aceasta zona spre 50% din cursa ascendenta dintre minimele din februarie 2009 (7.666 puncte) si maximul din aprilie 2010 (34.504 puncte) care se afla in zona de 21.000 puncte. Aceasta retragere ar permite in primul rand un test al trendului ascendent pe termen lung pornit dupa minimul din februarie 2009 dar si o detensionare a unor indicatori precum oscilatorul Stochastic. Dupa aceasta potentiala retragere (care poate fi chiar mai scurta de 50% din cursa amintita) indicele ar putea sa se inscrie din nou pe un trend intermediar ascendent care sa-l duca in a doua parte a anului peste maximele deja atinse.

Aceasta ipoteza este infirmata daca indicele face in perioada urmatoare noi maxime care pot sa-l propulseze spre zona de 37.500 puncte (161.8% din ultimul trend descendent minor) si mai tarziu spre media mobila simpla de 200 zile aflata acum imediat deasupra nivelului de 40.000 puncte. Nu trebuie uitat ca indicele se afla in continuare intr-un trend saptamanal intermediar ascendent care poate sustinte testarea si chiar atingerea de noi maxime in perioada urmatoare.

Pe graficul zilnic de mai sus (scara aritmetica), indicele BETFI se inscrie pe un trend minor descendent si potential mediu descendent din urmatoarele motive:

- indicele pare ca si-a incheiat o cursa in 5 valuri pornind de la minimele din 2009 si pana la maximele din aprilie anul acesta. O corectie de tip ABC ar putea urma si care sa preceada continuarea trendului ascendent pe termen lung prin atingerea de noi maxime in a doua parte a anului.
- indicatorul de trend MACD bate la poarta zonei negative dupa ce a semnalat iesirea din trend ascendent.
- media mobila exponentiala de 50 zile a fost strapunsa desi nu decisiv.

Ca obiective de pret in situatia unei corectii avem:

- zona dintre 28.000 – 29.000 puncte unde apare linia de trend ascendent pornita de la minimele anului trecut precum si fosta rezistenta transformata in suport.
- zona dintre 26.000 – 26.500 puncte, proiectia de 161.8% a ultimului trend minor descendent, fosta rezistenta transformata in suport dar si in curand media mobila simpla de 200 zile in urcare.
- zona suport pe termen lung dintre 20.000 si 22.000 care include retragerea de 50% a trendului ascendent de la minimele de anul trecut pana astazi (21.000 puncte).

O trecere a indicelui peste zona de 32.500 puncte in perioada urmatoare (retragere de 61.8% a ultimului trend minor descendent) deschide calea unui test al maximelor si chiar noi maxime (cu obiectivele de pret de la graficul saptamanal), pastrand indicele intr-un trend intermediar ascendent sustinut de linia de trend ascendent aflata acum in zona de 28.000 puncte.

Scenariu Long:
BUY la 32.500 cu SL la 30.000, TP1 la 34.500 cu RR (Reward/Risk): 0.8, TP2 la 37.500 cu RR: 2.00 si TP3 la 40.000 cu RR: 3.00.

Scenariu Short:
SELL la 30.000 (sau la un test esuat al 32.500 pentru un RR imbunatatit) cu SL la 32.500, TP1 la 28.000 cu RR: 0.9, TP2 la 26.000 cu RR: 2.00 si TP3: 22.000 cu RR: 4.7.

Ambele scenarii nu au Reward/Risk exceptionale si au un grad mai ridicat de risc iar cat timp indicele se afla in zona 30.000 – 34.000 puncte ar fi indicata retinerea prudenta de la tranzactionare intr-un sens sau altul pana la aparitia unor rapoarte Reward/Risk mai atragatoare.

SNP: Taurii au castigat

Asa cum am anticipat in analiza SNP: Lupta dintre tauri si ursi continua din 24 ianuarie 2010, taurii au castigat, asa cum se poate vedea in graficele comparative de mai jos:

Weekly Chart 24-01-2010

Weekly Chart 25-04-2010

Daily Chart 24-01-2010

Daily Chart 25-04-2010

Dupa o stationare scurta in prima zona target, SNP a atins latura inferioara a celei de-a doua zone target inainte de a se retrage spre media mobila exponentiala de 50 zile. Aceasta retragere s-a facut pe volume in scadere ceea ce indica faptul ca un nou asalt al zonei target 2 este probabil in perioada urmatoare.

Sunday, January 24, 2010

SNP: Lupta dintre tauri si ursi continua

Spre deosebire de alte actiuni romanesti care si-au continuat trendul ascendent pana in vara anului 2007, SNP a facut top la 0.6550 pe 3 februarie 2006 de unde incep trasate cicluri temporale de 34 saptamani pe graficul de mai sus. Se observa ca ultimul ciclu de 34 saptamani ce se incheie saptamana aceasta a fost unul de consolidare dupa miscarea de reversal din ciclul precedent, pretul osciland in jurul mediilor de 20 si 50 saptamani, fara a avea trend pe MACD dar situat in teritoriu pozitiv, cu volume in scadere si subperformant fata de indicele BETXT.

Dintr-o persepectiva a valurilor Elliot, putem emite ipoteza ca ne aflam in valul B (unul flat) sau inceputul valului ascendent C al miscarii corective ABC ce urmeaza celor 5 valuri evidentiate pe grafic ale trendului descendent precedent. De asemenea putem anticipa ca ultimul val C ascendent se poate finaliza in urmatorul ciclu temporal de 34 saptamani intre 29 ianuarie 2010 si 24 septembrie 2010.

Se observa ca pana acum pretul SNP si-a construit rezistenta la extensia Fibonacci de 161.8% (0.2900) a valului Elliot 5. In ipoteza inceperii (continuarii) valului ascendent corectiv C, zona target poate fi intre 0.3650 (fosta zona suport) si 0.3800 (50% retragere Fibonacci High – Low) sau 0.4000 (extensia de 261.8% a valului Elliot 5). Trebuie remarcata si SMA200 saptamanala ce coboara spre aceiasi zona target si poate constitui o rezistenta importanta precum si un magnet de pret. O iesire din consolidare sub suportul din jurul 0.2200 (varful valului Elliot 4 corectiv) are implicatii bearish importante.

Mai sus observam graficul SNP cu cicluri temporale de 55 zile pornind din 25 februarie 2009, ziua minimului de la 0.1120. Pretul numai ce a intrat in urmatorul ciclu temporal pe 18-01-2010 care va tine pana pe 05-04-2010. Pe parcursul ultimelor 2 cicluri pretul a fost intr-o consolidare dreptunghiulara intre 0.2430 si 0.2930 in care se da o lupta apriga intre tauri si ursi, nici unii nici altii neavand convingerea suficienta pentru a iesi din acest range. Free-float-ul de 8% al SNP este impartit probabil in special intre numerosi investitori institutionali puternici cu opinii contrare (dovada fiind numarul mare de rapoarte publicate despre SNP pentru clienti institutionali) care au determinat aceasta consolidare indelungata. Formatiunile de tip dreptunghiular, mai ales daca nu se produc dupa o perioada de scaderi sunt de natura conflictuala (intre tauri si ursi) si de consolidare si mai putin de indecizie. Din acest motiv exista o probabilitate mai mare de breakout in sus decat in jos, desi nu este exclusa a doua varianta.

Momentan pretul SNP (supravandut dupa Stochastic) se retrage de la rezistenta 0.2930 pe volume in scadere (bullish) catre suportul EMA50 si fosta rezistenta si potential suport de la 0.2700. Daca acest nivel de pret cedeaza, baza dreptunghiului si SMA200 ar trebui sa fie urmatorul suport in zona 0.2430.

Daca pretul SNP face breakout in sus din consolidare, in urmatorul ciclu temporal ce se incheie de Pasti prima zona target poate fi intre 0.3230 – 0.3430 (extensia Fibonacci 161.8% si 200% a inaltimii dreptunghiului). A doua zona target (unde se plaseaza si extensia Fibonacci 261.8% a inaltimii dreptunghiului) este cea identificata pe graficul saptamanal.

Scenariu Long:

BUY la 0.3030 (3% peste latura superioara a dreptunghiului 0.2930), SL la 0.29, TP1 la 0.3430 cu RR (Reward/Risk): 3.08, TP2 la 0.3650 cu RR: 4.77, TP3 la 0.38 cu RR: 5.92.

BUY agresiv la 0.27, SL la 0.25 (-7%), TP1 la 0.3430 cu RR: 3.65, TP2 la 0.3650 cu RR: 4.75, TP3 la 0.38, RR: 5.50.

Scenariu Short:

SELL la 0.2350 (3% sub latura inferioara a dreptunghiului), SL la 0.2500, TP1 la 0.2130 cu RR: 1.72, TP2 la 0.1930 cu RR: 3.63.