9/16/11: 1130/50 churn area - line in the sand?

[brosin]

This is still how I feel:

Jun 13, 2011 13:08:09 GMT -5 brosin said:

LOL 1st things first. I'm still HOPING we bounce off 1130/50... if lending markets improve, maybe a double dip would be off the table.

It is seeming more and more clear to me that a double dip IS coming/here/whatever you want to call it though. However, whether or not we test 666 and go below, I have no clue. 1130/50 is good enough for me for now, especially since that's almost 250 SPX (18%) off the market highs.

Once 1130/50 hit, I stopped STFRs and started BTFDs ;D

Jan 29, 2011 20:18:53 GMT -5 brosin said:

Preface by saying I voted Yes, deep (>5%) - I'm sure this stuns everyone ;D

But yeah I've said that I think SPX 1150/60 is on the table and that I would strongly expect 1150 and/or 1130 to hold as the line in the sand for the market.



Strategy:
I was glancing back through my wrap posts to kind of gather how I had been playing it (I track them here if anyone is interested)

It looks like I was fully long biased since 9/7/10 inception through 11/4/10 & 11/5/10 when I would go to neutral (11/4) and then bear biased (11/5) through 11/16 (alot of it very bearish by looks of it) when I went full bull again. I would be long biased again until 12/7/10, and since then have been varying levels of short biased until 1/24/10 when I would become 100% short allocated.

My plan is to STFR until 1130/1150, which I do not really anticipate taking long. It will happen so fast that no one will want to be long again, forgetting about all the easy money and what is happening (massive inflation) over the multiple year outlook.

This was the first time I posted this chart



This is what it looks like now. Churn churn churn.

[brosin]

Wow I don't know how I missed hearing anything about this. Was just checking the Excess Reserves release to make sure there wasn't one this week, and found some recent news (I remember the days many months ago when there would be nothing on Excess Reserves at all)

And I did one of these

Goldman Sees Greater than 50% chance the Fed dumps the interest rate on Excess Reserves

Aug 9, 2011 10:17:02 GMT -5 brosin said:

The one thing the Fed CAN do is start to force banks to lend.

In other words, remove the interest rate attached with Excess Reserves. Stop letting the banks have a free ride - if he's deadset on creating inflation, I don't at all get why he's just letting them hold it in cash and not making them (or encouraging them) to lend it.

[erxtrader]

lol, maybe the Fed should go one step further and CHARGE them for having excess reserve ...

[brosin]

deal - we'll call it the underdraft fee ;D

[timber]

traders need to be aware of this....im banking of a year end rally now....1136 i think was the second bottom.....im not sure if they re-test that spike down to 1101 at least this year

[timber]

im actually thinking of getting rid of most of my hedges and letting my long bias ride now.....we could run into the meeting and never look back

[brosin]

I will be ready to capitulate under 1130 SPX, I'll say that much. Until then, I remain rainman bullish ;D

[rex]

Sept 21, 2011 20:21:45 GMT -5 brosin said:

I will be ready to capitulate under 1130 SPX, I'll say that much. Until then, I remain rainman bullish ;D

Tomorrow afternoon then? Bros., be careful. This is our 6th time down here in 8 weeks. One of these are going to break way down. I think you've got about a 16% chance of heading back up to 1220. JMHO GL

[brosin]

What makes you so sure it's not going to break way up though? Market hasn't been easy in months, I don't see it becoming that way now

[Rothschild]

Yeah, the internals are quite bearish; short-term the market has resistance at the S&P 500 1220 area and support at 1165. I believe the market is likely to trade in that range for the next few days and then make a move out of it to start a move that will last for the next several months. With that said, from failed moves comes FAST moves. We have established a pattern of lower highs and lower lows so therefore the case for the bulls remains suspect imo until proven otherwise

[commodityypro]

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This is a big channel and we have been in it since July only to briefly pop out of it a few times to only come back to it. Tough to short here is you think we continue to bounce in it. Until we break 1100, the coast is clear to trade this channel. We could easily open 140 or lower so hard to go short but you can, just be nimble. GL!

[brosin]

A more true thread title would now be

"the 1130/50 churn area - IS it the line in the sand?"


(CHART NOT UPDATED - just reposting it)