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Insight on the bearish options bets that initially sparked the thousand point decline on the Dow, with Nassim Taleb, “The Black Swan” author.
The major averages ended lower in November after encountering resistance near their April 2010 highs. Furthermore, the 12 week rally which was confirmed on the September 1, 2010 follow-through day (FTD) ended on Tuesday, November 16, 2010. This corresponded with a steep rally in the US dollar and a fresh round of European debt woes.
LIKE THIS? JOIN OUR FREE NEWSLETTER Has copper lost its importance? The basic premise is that for the past few years, copper and other industrial metals, no longer play a critical role for global economic growth. Don’t take my word for it; the proof is in the charts. Since 2011, copper prices have been…
2010 is set to be a promising year for the hedge fund industry, according to research from Moody’s. Uncertainty over regulation and the economy means the industry isn’t out of the woods yet, Odi Lahav from Moody’s told CNBC Tuesday.
Market Action: Price & Volume B+
As we know, the major averages topped out in October 2007 and then proceeded to precipitously plunge until they put in a near-term bottom in early March 2009. Since then, the market snapped back and enjoyed hefty gains which helped send the major averages to one of their strongest 18-month rallies in history. The small cap Russell 2000 Index was the standout winner, surging a whopping +117%. The tech-heavy Nasdaq Composite is a close second, having vaulted +100%before reaching its interim high of 2,535 on April 26, 2010. The benchmark S&P 500 Index raced+83% higher before hitting its near term high of 1,219 on April 26, 2010, and the Dow Jones Industrial Average soared +74% before printing its near-term high of 11,258 on April 26, 2010.
This data indicates that Monday, April 26, 2010 appeared to be a very important day for the market because that is the day that most of the popular averages printed their near-term highs and negatively reversed by closing lower from new recovery highs. In addition, after such hefty moves, the 11-18% pullback was healthy enough to help shake out the weak hands and send the major averages higher last month. However, if the 2010 lows are further breached, then odds will favor that even lower prices will follow. Allow us to be clear: the action since the July low has been robust, very healthy, and suggests the bulls are now back in control of this market. Trade accordingly. Never argue with the tape, and always keep your losses small.
Goldman Sachs CEO Lloyd Blankfein testifies regarding charges the firm used a strategy that allowed it to take the opposite side of investments it was selling to the firm’s clients.