Recent Market Instability

15 posts / 0 new
Last post
Lemonyellowschwin's picture
Lemonyellowschwin
Status: Platinum Member (Offline)
Joined: Apr 22 2008
Posts: 561
Recent Market Instability

Maybe I'm being totally obvious here, but for the last three weeks or so it seems like markets have become unstable after a period of relative calm (maybe for six months or so before that).

Among other things, we've recently seen:

-- The situation with Greece and the ad hoc efforts of the leaders of the core EU countries trying to figure out how to deal with it;

-- The $1 trillion solution to the Greek contagion problem, which I still do not understand and I'm not sure if very many people actually do;

-- Muli-month highs in Libor rates;

-- An unusual decoupling of the normal inverse ratlionship of gold and the dollar;

-- Currency gyrations up and down on the order of 1% or more per day;

-- Actual serious discussions about the Euro's future;

-- Gold hitting an all-time high (before backing off the last few days);

-- That crazy 1000 point stock market drop day;

-- More daily volatility in the stock markets (this is anectodal) than it seemed we had been seeing for some time with plenty of down days; and

-- Intervention in the markets by German authorities.

Am I crazy or doesn't it sort of seem like things are cracking up a bit?

Otoyolda Deprem Anı

 

docmims's picture
docmims
Status: Platinum Member (Offline)
Joined: Jun 17 2009
Posts: 644
Re: Recent Market Instability

There was a big spike down yesterday over just a couple minutes.  It's on the chart for the dollar and for the dow.  Anybody have information on that?  I was in court all day with no cell phone or contact with the outside world.

Subprime JD's picture
Subprime JD
Status: Platinum Member (Offline)
Joined: Feb 17 2009
Posts: 562
Re: Recent Market Instability

People are getting nervous again. Sovereign debt issues are now at the forefront. The year long euphoria is fading quickly. China's bubble bursting coupled with the eurozone/uk fears have shattered confidence. The US is the last stronghold for confidence. Once the aura of invincibility of the US eceonomy has been pierced, its game over for this phase as we enter the next.

Erik T.'s picture
Erik T.
Status: Diamond Member (Offline)
Joined: Aug 5 2008
Posts: 1234
Re: Recent Market Instability

I think today (May 20) will be a bloodbath. I knew we'd break 1100 today, but the fact that it happened at 7am (when markets are usually being ramped higher) and the speed at which it happened told me this thing is ready to blow.

Sadly PMs are selling off with equities (back to positive correlation), so for the moment I'm loosing more in metals than I'm making from my shorts. Not sure which was that's going to go, but I'm convinced it'll be a really big day.

Erik

 

idoctor's picture
idoctor
Status: Diamond Member (Offline)
Joined: Oct 4 2008
Posts: 1731
Re: Recent Market Instability

I think today (May 20) will be a bloodbath.

This maybe an understatement LOL. The Greeks are starting bright & early today. I bet "some" might be drinking thru the day.....look for trouble to happen toward the end of the market IMHO.

 Breakout the popcorn....showtime...

joemanc's picture
joemanc
Status: Martenson Brigade Member (Offline)
Joined: Aug 16 2008
Posts: 834
Re: Recent Market Instability

For a little while there, I thought it was just investors taking profits as the market had pretty much gone straight up since last March. But the instability has been going on for a few weeks now as LYS has pointed out. And the market moves during the day have been wicked. Something is definitely up(or is it down?). Undecided

SteveW's picture
SteveW
Status: Gold Member (Offline)
Joined: Jan 21 2010
Posts: 490
Re: Recent Market Instability

The instabilty started at the beginning of May, at least that's when the VIX started its climb to double its April 30 value.

Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
Re: Recent Market Instability
Erik T. wrote:

I think today (May 20) will be a bloodbath. I knew we'd break 1100 today, but the fact that it happened at 7am (when markets are usually being ramped higher) and the speed at which it happened told me this thing is ready to blow.

Sadly PMs are selling off with equities (back to positive correlation), so for the moment I'm loosing more in metals than I'm making from my shorts. Not sure which was that's going to go, but I'm convinced it'll be a really big day.

Erik

 

But Erik, CNNMoneyline said today that this is a great buying opportunity!

They said it. I'm all in. 100 S&P e-mini contracts please!!!

Yell

http://wallstreet.blogs.fortune.cnn.com/2010/05/20/buy-the-dips-now/

docmims's picture
docmims
Status: Platinum Member (Offline)
Joined: Jun 17 2009
Posts: 644
Re: Recent Market Instability
Morpheus wrote:

But Erik, CNNMoneyline said today that this is a great buying opportunity!

They said it. I'm all in. 100 S&P e-mini contracts please!!!Yell

In between the lines "please buy so we can sell" thanks.

investorzzo's picture
investorzzo
Status: Diamond Member (Offline)
Joined: Nov 7 2008
Posts: 1182
Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
Re: Recent Market Instability

I see a DOUBLE BOTTOM formed up. 

What I am going to do is hold steady and see if this thing turns. We may have another run up

 

docmims's picture
docmims
Status: Platinum Member (Offline)
Joined: Jun 17 2009
Posts: 644
Re: Recent Market Instability
Morpheus wrote:

I see a DOUBLE BOTTOM formed up. 

What I am going to do is hold steady and see if this thing turns. We may have another run up

That last bottom took out the 200 month trend line, though.  I hope you are right I haven't drilled my well or installed my solar yet. need a little more time.

Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
Re: Recent Market Instability
docmims wrote:
Morpheus wrote:

I see a DOUBLE BOTTOM formed up. 

What I am going to do is hold steady and see if this thing turns. We may have another run up

That last bottom took out the 200 month trend line, though.  I hope you are right I haven't drilled my well or installed my solar yet. need a little more time.

I don't think any of us know. I pointed it out because I think it's something to keep an eye on. I've been so busy watching the EUR implode that I missed a classical pattern staring me right in the face. 

Too early to tell. I want MORE confirmation. Friday was a "weird" trading day. Sorry, I don't trust that day's price action. 

There is one thing wrong with it that gives me great pause: The second bottom's volume is very very high. 

Yeah, the 200. Strike Two. 

MACD sucks, CMF improving. Dunno. Yell

Erik T.'s picture
Erik T.
Status: Diamond Member (Offline)
Joined: Aug 5 2008
Posts: 1234
Re: Recent Market Instability

My take is we're going to see a bounce from here to retest the 200DMA, presently at 1102. A decisive breakout above the 200 line would cause me to change plans (take off the shorts) and expect another leg up, possibly higher than the old 1220 high. But if we bounce off the 1100 level to the downside, I think we'll take out 1044.5 (feb. resistance) and the next bounce won't come till 1015 or so.

Erik

 

Nacci's picture
Nacci
Status: Silver Member (Offline)
Joined: Apr 22 2009
Posts: 194
Re: Recent Market Instability.

This is pretty damn funny and sobering.  Enjoy: http://www.silverbearcafe.com/private/05.10/questions.html

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Login or Register to post comments