Before the Open (May 20)

Good morning. Happy Friday.
The Asian/Pacific markets closed mixed. Only India (up 1%) was a significant mover. Europe is currently mixed – no big movers there. Futures here in the States point towards a down open for the cash market.
The market moved down Mon and Tues and then up Wed and Thurs. The up days were bigger than the down days, so we have a gain for the week so far (exactly what was needed per the open-interest data posted Mon), but volume has dropped off the last two days. The indexes are in decent shape but not great shape. Overall I’d consider the long trend to be up, but short term things are still cloudy.
Here’s the SPX daily. There’s nothing wrong with this chart. We got a breakout at 1340 and now a falling wedge.

Yesterday LinkedIn (LNKD) did great on its first day of trading, but as I said at the time, they got screwed out of a lot of money while the bankers and all their friends are laughing all the way to the bank. There’s some evidence out there that a hot IPO market is not a good sign for the market, that market tops tend to form around the same time. This is partly due to the bankers having a pretty good pulse on Wall St. and advising their clients to go public at the exact right time. It’s also due to the increased float of stock – same demand with more supply pushes prices down. I don’t think LNKD is big enough to mess up the supply/demand equilibrium too much, but if a couple other companies (Facebook, Twitter, Groupon, Zynga) see LinkedIn’s success and move their IPO dates forward, I’d be very worried.
More after the open.
headlines at Yahoo Finance
today’s upgrades/downgrades
yesterday’s sector performance
this week’s Earnings
this week’s Economic Numbers

0 thoughts on “Before the Open (May 20)

  1. My, “Two Cents”: I’m going to predict a volatile Summer market and a renewed Fall. A Summer market that reacts to news and rumors while waiting for concrete word of QE3. Will the Fed delay QE3 in hopes that the nation will take up the slack and move forward on its own? I would, if I was the Fed. At some point business has to stand on its own two feet.
    The EUR/USD and SPY look like Siamese tweens at the moment with the EUR being the more hyper. Implications: if the USD goes up in value this will put downward pricing pressure on the SPY (and everything else priced in USD). Up until now the SPY has been going up in price while the USD has been going down in value. The cessation of QE2 spending and money printing should reverse the USD devaluation causing the SPY to go down in price unless investors think the US Equity market (SPY) has more value than the other markets. The TLT has been going up in price because the FED has been buying bonds; the cessation of bond buying should cause the TLT to go down in price. It looks like the cessation of QE3 will cause everything but the USD to go down in price so where will all these losers go? I’m guessing the SPY, why? Because I think the US Industrial might will put both feet on the ground and get’r done. I hope they realize the US was there to bail them out now they need to bail out the US.

  2. Neal, –are u trying to imetaite the fed–did u throw tantrums when u where a baby
    –did u love ur mother/father–what was ur childhood like

  3. what neal is probably trying to say is that central banks world wide are trying to hold the statis quo—go nowhere markets and turn usa into another zombi japan for the next 20 years
    we will be alowed wild intraday or even weekly wilds but returning to the net zero line
    big banks have devised a system that will serve the feds purpose–note german deauthcher bank,
    neal can tell us all about this alfa type of trading,when he stops being the perfect master
    CENTRAL BANKS WILL FAIL AS WILL GOVTS AND WE ARE GOING TO ZERO

  4. a example of zombi behaviour
    today the company that runs the destroyed nuck plant in japan –said it cant meet its debts
    –bankrupt right–well the banks and govt pleaded with it—no no dont say that we will extend ur debt repayments at zero percent forever,even give u a bigger bailout
    —that way the banks dont have to right of the debt and its on the banks books as a good loan

  5. how much does the terminator want
    california is broke u know and has even been tapping the pension funds of the beurocrates
    june 9th –california to default and file bankruptcy——–?????????????

  6. The Perfect Master will wait & see,
    If tomorrow ends it’ll bring him Glee,
    Arnold copied his Dad from the SS,
    his Maid could only yield & say Yes.
    The Kennedys have lost another brick from the house of Camelot
    whilst Californication yields further into the Rot !

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