Friday report - VISION FINANCIAL MARKETS

From Nov 2nd to present there have been no 3 day sell off in the S&P.
One of the big things that changed over the last few days is VOLUME.
The down side tends see more and the higher the markets go the less volume there is. Eventually that will catch up with the stock market. Several well know market letters are questioning if the sell off is actually the markets rolling over or just another sell off that reverses into new highs?
We don’t know but what we do know is the SPH fell right into every level of sell stops we put out yesterday, the only ones they didn’t get were the sell stops under 1103 down to 1098.
GE just reported and the SPH that was up .50 handles is now down 6 handles. We have no economic release today.
In Asia 11 out of 11 markets closed lower. In Europe 10 out of 10 markets are trading lower. Our call? Currently the markets do not have a good feel to them.
But it’s a Friday and we have a term we call counter trend Friday.
If we see oversized GLOBEX volume 350-450k we would lean to buying weakness with tight stops. If that fails it could be another big day of sell program.
Ideally we would like to get a look at how the premium between the cash and the futures look before jumping in. You take it from there...

Thursday report - VISION FINANCIAL MARKETS

The earnings season is heating up and it feels like the smart money maybe doing some selling. You could see it in the cash market all day.

Today Fifth Third (FITB), Goldman Sachs (GS), Keycorp (KEY), PNC Financial (PNC) pre-market while Capital One (COF), American Express (AXP) and Bancorp South (BXS) report after the close. Friday brings pre-market numbers from BB&T (BBT), General Electric (GE), McDonalds (MCD) and SunTrust Bank (STI). So we have all sorts of big names reporting.
In Asia 7 out of 10 markets closed lower as China continues to clamp down on bank lending. In Europe, out of the 10 markets being quoted 6 are trading higher, 1 is unchanged and 2 are trading lower.

We have a simple rule on trying to get back on track and it’s listening more and trading less.
We are going to take a step back. What we will do is remind everyone that out of the 12 trading days in the New Year 12 have been up and 4 have been down. That last Friday the SPH closed at 1132.30 and yesterday it closed at 1133.00.

And lastly, if the markets are rolling over we are only 15 handles off the contract high and nearly 490 handles off the low. Look down the red boxes. If you look down to DEC 15th the SPH was down then up on the 16th, down on the 17th and then had 5 up days in a row. We do not know if these patterns will hold but we think its well worth looking at. Goldman on tap…

Thursday report - VISION FINANCIAL MARKETS

A friend sent us something last night that said to watch the 1150 strike price in the SPX.
That the open interest is around 65k (7.5bln in notional exposure) and that most of it was bought at the end of the year and the beginning on 2010. He said if the street is short (which it sounds like they are) that it translates in to roughly 200mil in index futures to buy for every $1 move in the futures.
That is could act like a magnet the closer we get to 1150. Its 6:30 AM Thursday morning, crude is up .21 cents and the SPH is UNCHED.

In Asia 10 out if 11 markets close higher with the one market that did close lower (Hang Seng) only off 0.15%.
In Europe 7 out of 10 market are trading higher. Our call? The S&P cash stats for the Tuesday before the JAN expiration has been up 15 / down 11 of the last 26 occasion.
Despite saying we wanted to sell rallies yesterday we lean to higher prices today and tomorrow. Buy weakness. If they don’t go up today they will tomorrow. We still have 1150-1153 and the 1180-1185 level as out next upside objectives.