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The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
* Major World Market Indices * Futures Markets * U.S. Sectors and ETFs * Commodities * U.S. Bonds * Forex

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* If the dots don't connect, gather more dots until they do...or, just follow the $$$...





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Thursday, December 15, 2011

Where are the "Fat Cats" hiding and what are they up to?

Where and what, indeed! Methinks their hiding place is within the "Thin Ice Zone" that I mentioned in my post yesterday: http://strawberryblondesmarketsummary.blogspot.com/2011/12/some-bears-are-still-awake.html

I say this because what has been "hatched" from within this zone since August of this year has been one clever-sounding rumour after another, and cleverly-timed press releases, the results of which have made little or no impact on resolving global economic challenges as countries' politicians struggle with fiscal/unity problems. In the meantime, we're left with this volatile and unpredictable market of 2011.

For example, as I mentioned in my post of December 3rd: http://strawberryblondesmarketsummary.blogspot.com/2011/12/fat-finger-look-likes.html, immediately after Standard & Poor's downgraded the U.S. credit rating, price plunged down towards the upper end of the former "Fat-Finger" candle on the Weekly timeframe of the YM, ES & NQ, and mid-way into it on the TF...a violent re-test of this extremely volatile action...pre-planned or coincidence?

Manufacturing may have been up on this latest monthly data release, as shown on the graph below, but business inventories also rose this past Tuesday, as shown on the second graph (both graphs courtesy of www.forexfactory.com). We'll see whether the smoke continues to billow from those chimneys or whether it will reduce to a wisp as growth slows in global economies...something to add to the "Watch" compartment in my  "little grey cells" as a potential negative influence/drag on the equity and commodity markets.

By the way, the TF has re-visited the "Fat-Finger" zone since my post of December 3rd and is currently trading within...the ES dipped its toe into that level just after mid-night last night and has closed today just above...the updated Weekly chartgrid of the YM, ES, NQ & TF is below...the important "Fat-Finger" levels are 11000 for the YM, 1200 for the ES, 2050 for the NQ, and 730 for the TF...a hold below those levels could set the stage for more violent plunges ahead.

The ES, NQ & TF are still trading within their respective "Thin Ice Zones," while the YM trades above.

The VIX closed above 25.00 again today, as shown on the Daily chart below...as I mentioned in recent posts, it's my opinion that anything above this level holds the potential for large volatile swings in the S&P 500...an important level to be held by the bears.

Finally, be sure you know who's waiting under the mistletoe before venturing underneath...it could be a Santa-imposter!