Abenomics: medicine or poison for Japan?

[The Don]

its a good job I dont have to get my news from the BBC isn't it?

Am I wrong about the current level of the Nikkei 225 ?

As far as I can see, the current level is c14,000, down around 40 on the day.

iyes, you are correct, it could be due to any or all of those things, we will never know. what we do know is that is that since the cash market closed, the futures (JPN225 above) has dived 400+ points from its recent highs and is very likely heading towards the previous 13600-13400 zone again today, at least intraday anyway.

I'm getting futures at 13,870 is that generally the same region you're looking at ?

this is entirely expected market behaviour, (and why I'm now short) - after a breakout, eventually comes a re-test of the broken-through level, again in every timeframe you look at.

we dont know the answer - ie succeed/fail when it gets there - ie bounce and up again, or bounce, re-test and fail [the 2 options] so if we get there I'll just close the trade right around where I expect the next lot of stoprunning will go on (in the opposite direction to my position) and reassess then.

but this is of no interest until we get there and I'm looking for trades at those levels, in the meantime getting a few hundred points out of the slides is my only interest.

I suppose the reason Im showing you this view of things is because you all still seem to think equities are driven by fundamentals. they're not, certainly in the short term anyway, they're driven by people like me, but with a lot more money

I think most of us realise that the short-term market is driven my a mixture of fear and greed. I guess where you and I differ that I believe that the underlying market trend is driven by fundamentals (or at least the perception of what the fundamentals are likely to be in 18-24 months) whereas I believe that you think the market is manipulated by a handful of powerful financial institutions whose objective is to perpetuate the status quo regarding fiat money and the global economy.

 

[The Don]

Looks like the only way is up though ........



Not that I believe that lines on a graph can forecast anything

 

[kevsta]

Looks like the only way is up though ........

[qimg]http://img33.imageshack.us/img33/7299/b8iq.jpg[/qimg]

Not that I believe that lines on a graph can forecast anything

it's about time somebody else started playing. you need my intersecting bear line through the top, right about where we are now.

and see, the thing about trendlines is that markets do tend to track along them, as the easiest path of resistance, and you need events or news to bring in heavy buying or selling to alter the current trend.

so we can say that if there are no news or events, that markets tend to track trendlines, if that helps?

 

[kevsta]

Am I wrong about the current level of the Nikkei 225 ?

As far as I can see, the current level is c14,000, down around 40 on the day.

no but I am referring to futures, as you subsequently worked out

I'm getting futures at 13,870 is that generally the same region you're looking at ?

again yes, in fact I just closed out both trades prior to ADP number.

+72.50 (0.725%) and +245.93 (2.45%)

I think most of us realise that the short-term market is driven my a mixture of fear and greed. I guess where you and I differ that I believe that the underlying market trend is driven by fundamentals (or at least the perception of what the fundamentals are likely to be in 18-24 months) whereas I believe that you think the market is manipulated by a handful of powerful financial institutions whose objective is to perpetuate the status quo regarding fiat money and the global economy.

what Im not sure lots of people (including me btw, although I feel I have more insight than most) dont really get, is what the modern markets actually consist of.

I have another rhetorical question, I'll spare you the image unless you want it, but the balance on this (real) account is now + $513 (5.13% across 7 trades, 6 of which were in the last 10 days)

so that extra $513.. where did it come from? whose was it? is even it real money at this point? if so where is it currently? and doing what? if not, then when if ever does it become real money?

..do you believe this is air, you are breathing, in this place..? ( )

oh, and yes, how is it exactly that me and all my mates can alter the opening price of the real Nikkei, while it was closed and no stocks were bought or sold? I would seriously like to know the exact mechanics of this , because it definitely happens every day.

 

[Puppycow]

I don't know if this is another example of traders seeing good economic news as bad, but that's how Bloomberg is interpreting it:

U.S. Stock Futures Retreat as ADP Jobs Data Tops Estimate

U.S. stock-index futures remained lower after a private report showed companies added more jobs than economists forecast last month, fueling concern the Federal Reserve will begin to reduce monetary stimulus.

Futures on the Standard & Poor’s 500 Index (SPX) expiring in September slipped 0.6 percent to 1,598.3 at 8:17 a.m. in New York.

Companies in the U.S. boosted employment by 188,000 workers in June, figures from the Roseland, New Jersey-based ADP Research Institute showed today. The median forecast of 38 economists surveyed by Bloomberg called for an advance of 160,000. Estimates ranged from gains of 100,000 to 196,000.

On the other hand Asian and European markets were down today before the ADP report was released, so maybe this was just going to start out as a down day to begin with anyway.

There was also good news from automakers. Although I'm not sure if the results beat analysts' expectations or not.

Rising consumer confidence and a rebounding construction industry pushed auto sales to near pre-recession levels in June.

Automakers sold about 1.4 million vehicles last month, a 9% gain from the same period a year earlier. The brisk sales amounted to an annualized pace of about 16 million, a threshold not seen since 2007.

"America's families are better off than they were at the beginning of the year and they believe — with good justification — that the economic expansion is going to continue," said Mustafa Mohatarem, General Motors Co.'s chief economist.

Much of the growth came from booming truck sales, fueled by the recovering housing and construction industries. GM saw its biggest increases in pickup truck sales, with a roughly 30% gain in June from the same month a year earlier.

"Trucks are hot. There is no question about it," said Kurt McNeil, GM's sales chief.

Both Ford Motor Co. and Chrysler Group posted 24% sales gains for their F-Series and Ram trucks, respectively.

You might think all this good news might be positive for Wall Street, but no. Good news means it's more likely that the Fed will take away the proverbial punch bowl and that's bad.

 

[Puppycow]

this is entirely expected market behaviour, (and why I'm now short) - after a breakout, eventually comes a re-test of the broken-through level, again in every timeframe you look at.

So in a way it was inevitable that the Nikkei would come back down and retrace some of its gains after a run-up like that (over the end of last year and first 5 months of this year, and not a reason to freak out. I think when the Nikkei fell 20% after gaining about 70% that a lot of people came out the woodwork to pronounce Abenomics a failure or at least in deep trouble. I think the jury is still out, but so far at least it appears to be a net positive.

I suppose the reason Im showing you this view of things is because you all still seem to think equities are driven by fundamentals. they're not, certainly in the short term anyway, they're driven by people like me, but with a lot more money

I don't doubt that if you are talking about the short term, but surely in the long term companies that are more profitable and grow faster and create hit products will be valued higher than those who don't. Would you trade based on the technicals when an earnings report is about to be announced? BTW, I don't doubt you are a successful trader with a system that works for you. I don't think you could have easily faked those screen shots. And if it really works, then it probably isn't entirely illogical. And you have a rational basis to keep using your system if it has been reliably increasing your wealth.

But I also think that there are other ways to make money in the stock market that are also good. I don't think that Warren Buffet pays much attention to what's happening to the price from minute to minute, but rather to the fundamentals and the long-term earnings prospects of a company, and this approach has clearly been very successful. IOW, I think that for long-term investors, fundamentals are more important than technicals.

 

[kevsta]

So in a way it was inevitable that the Nikkei would come back down and retrace some of its gains after a run-up like that (over the end of last year and first 5 months of this year, and not a reason to freak out.

no, definitely not, markets always retrace prior movement, eventually.

I think when the Nikkei fell 20% after gaining about 70% that a lot of people came out the woodwork to pronounce Abenomics a failure or at least in deep trouble. I think the jury is still out, but so far at least it appears to be a net positive.

not arguing really, time will tell. what I would say is that the rapid rise didnt make it a success either though, although of course its a positive sign.

I don't doubt that if you are talking about the short term, but surely in the long term companies that are more profitable and grow faster and create hit products will be valued higher than those who don't. Would you trade based on the technicals when an earnings report is about to be announced?

actually, yes, but not until it was already out and the false move and trap had already been sprung.

BTW, I don't doubt you are a successful trader with a system that works for you. I don't think you could have easily faked those screen shots. And if it really works, then it probably isn't entirely illogical. And you have a rational basis to keep using your system if it has been reliably increasing your wealth.

thank you, I wouldn't go that far yet, but I can honestly say there has been zero fakery, and I genuinely do think I'm onto something.

whether I can make it work long term, who knows, fingers crossed.

But I also think that there are other ways to make money in the stock market that are also good. I don't think that Warren Buffet pays much attention to what's happening to the price from minute to minute, but rather to the fundamentals and the long-term earnings prospects of a company, and this approach has clearly been very successful. IOW, I think that for long-term investors, fundamentals are more important than technicals.

yes, I agree, if you're actually buying to own stocks you're 100% right.

but, what percentage of volume are long term held, compared to the enormous volumes of derivatives (futures, options, swaps etc) traded by dark pools with virtually limitless funds and this tail wagging dog thing we see everywhere?

they certainly can make your buy and hold journey very difficult along the way at the very least.

 

[kevsta]

I don't know if this is another example of traders seeing good economic news as bad, but that's how Bloomberg is interpreting it:

You might think all this good news might be positive for Wall Street, but no. Good news means it's more likely that the Fed will take away the proverbial punch bowl and that's bad.

strange dynamic in play today... irritatingly I cant short the Egyptian stock market.

stocks soar on Egypt news and ongoing Portugal crisis crude ran up through $100 a barrel to $102 overnight, currently at $101.xx and the tanks have been deployed in Egypt.

Courtesy of the BBC's Jeremy Bowen, we can see that the tanks in Cairo are now deployed. Surely this will add at least another 10 points to the Stalingrad and Propaganda 500 on anywhere between 2 and 3 contracts in today's hilarious zero volume revolutionary melt up.

it's definitely a funny old game, at the very least - I laugh more during trading than every job I've ever had, but one.

 

[kevsta]

GS Euro Trade Update

Update.. in case people wonder about the daily forex manipulation I go on about all the time, I've shown it in the highlighted ovals. this is a text book setup, rarely are they as clear and easy as this.

now ask yourself, is it possible that the best informed people in the markets might have known yesterday, that... [today's news]

Next target Stolper's stop loss at 1.28 if history is anything to go by

Ok so I have been following this trade along screenshotting and adding my comments as I go along, because it's obviously easy to explain what has already come before. And it might appear that I (along with ZH, although using entirely different methodology) have had a modicum of success predicting what was to come..?

So I'll explain through what I think was going on and the nuances of manipulation chart by chart, and then I'll say no more about it, in the Japan thread anyway. Its just that obviously I started here so... so the above chart now shows a first SM push down (70-90 pips avg) and the system now has us biased and looking for manipulation at a higher level, before commencing the second push down.

Its probably worth explaining now, that the ADR (average daily range) line is pre-calculated from previous history, they are dotted if not touched, and go solid red when touched on that day. Notice how price nearly always responds there, and not only that, often to the exact pip ? why's that, hmm? anyway next day.. price wanders out of Asia and does not even breach the Asian highs (orange oval) indicating no clear order (stoploss) taking, then starts to fall.

however as we are expecting a fall, and sometimes on day 2 you get what is called a "straightaway trade" - ie - no spikes first, because they just want to further demoralize the trapped traders with rapid declines.. [remember, trapped negative is not a profit for them, they need to shake you out and cash in your losses, to make their profits.

so some, more aggressive or experienced manipulation traders would take that orange trade, to me it was suspect, so I left it alone, even though it did fall. If you had taken it you could have pulled a decent profit if you were quick, or at worst should have been stopped at breakeven. the price then touched the lower ADR to the pip and bounced [yawn] before powering higher to my new HPM (high probability manipulation point) but it didnt show manipulation there, it just blew straight through and gave a powerful stoprun and confirmation reversal at the upper ADR, before sinking back into the range again and accumulation, - classic 1 day fake out.

I am in theory short right here as shown -in practice it was late and I dont leave trades on overnight, so I didn't, but that was a valid entry.

Then price drifts overnight as SM further accumulates their positions, tending to trend down as they are selling, but with one little headfake high during Asia to induce some buying, but otherwise trending downwards steadily. then we have some classic textbook manipulation through the 200EMA (blue line) - you have to remember, those 2 red pins to the highs, were at one point big blue spikes flicking the top of those pins, looking like they were going to break out. two candles is 2 x 15 mins, for 30 minutes price teased emotional retail traders, before immediately selling down hard and reversing.. [who coulda know'd it? ]

also, note how if I had moved the stoploss down to breakeven from my entry the previous day, those pins took me out at zero, before dropping? [sure its all coincidence]

you'll see the "shift bar" again, at this point, we kinda know'd it..

BOOM! action time arrives...

and at the ADR 80% of the trade comes off, 20% still on looking for Stolper's stoploss at 1.28

The above charting is my analysis platform, I trade Forex on an ECN account, here's the live trade, also notice on this chart, the overnight orange trendline, those 2 pins were headfaking a breakout at. you can also see on this one I actually took it prior to those pins to the highs, because I had to go out, but was still confident from the day before.

I've said before, sometimes, it is ridiculously easy to see what they are doing. that was 75 pips (0.75%) x 0.4 of a contract ($40k) closed = + €230 (2.3% account size) with $10k still riding, but a "Guaranteed Win from Stolper" is always nice too

 

[Fast Eddie B]

Not that I believe that lines on a graph can forecast anything

Or, maybe that they CAN forecast ANYTHING!

 

[kevsta]

Or, maybe that they CAN forecast ANYTHING!

but think about this seriously please? is this actually technical analysis, or something else entirely? behavioural analysis would be a better description.

(Attempting to) "follow in the footsteps of the giants" is how we like to think of it.

MODS - if you want to cut all of this out into a "Forex Market - Manipulated or not?" thread at some point that would probably be good?

 

[Puppycow]

The EURUSD certainly does not look to be going Stolper's way so far.

Did that big red down bar coincide with the statement yesterday from the ECB? (I believe it was seen as dovish)

 

[Puppycow]

yes, you are correct, it could be due to any or all of those things, we will never know. what we do know is that is that since the cash market closed, the futures (JPN225 above) has dived 400+ points from its recent highs and is very likely heading towards the previous 13600-13400 zone again today, at least intraday anyway.

This didn't come true though did it?

Did you get caught out short? Nikkei is at 14,166 right now according to Bloomberg.

 

[Puppycow]

strange dynamic in play today... irritatingly I cant short the Egyptian stock market.

And probably a good thing for you that you couldn't:

Egypt's Stock Market Is Going Totally Bonkers

The dramatic events in Egypt hit a crescendo on Wednesday when the military removed President Mohamed Morsy.

Despite this political turmoil and uncertainty, the Egyptian stock market is exploding higher. Egypt's EGX 30 is at 5,334, up 363 point or 7.3% on the day. This is the highest level in a month.

 

[Puppycow]

Some charts and discussion here you might want to see:

http://www.businessinsider.com/bank-of-england-ecb-rate-moves-2013-7

 

[The Don]

The EURUSD certainly does not look to be going Stolper's way so far.

Did that big red down bar coincide with the statement yesterday from the ECB? (I believe it was seen as dovish)

Yes, I believe that it was.

 

[kevsta]

This didn't come true though did it?

Did you get caught out short? Nikkei is at 14,166 right now according to Bloomberg.

no I closed that trade at 13850 as price was looking sticky there and we had news due out, and yes 14300+ atm.

Did that big red down bar coincide with the statement yesterday from the ECB? (I believe it was seen as dovish)

the moves always seem to coincide with some news or other but you should be able to see that we (us manipulation traders) were already looking for a down move along with the "smarter" or better informed market participants. Today we are potentially looking for the same trade again, clear manipulation and the 3rd push down. also the "weekly" SM cycle doesn't have to fit into "working" weeks, it generally tends to run 3-4 days and can span 2 weeks across a weekend, so it's possible it doesn't come today. but if it does, another 80 pips from here hits my TP (on the remaining 10k) and Stolper's (imaginary) stop loss simultaneously. (Muppet bank transfer to GS & kevsta )

it's also possible it carries on running without letting me back in again safely with a new trade. the more aggressive manipulation traders take the countertrend longs too while waiting for the primary short to set up, but I'm not there yet.

 

[kevsta]

Yen seems to be strengthening against all currencies this morning, vertical red lines on all crosses Im watching. Looks like a good time to hit the Nikkei ShortiT! button again

the 2 charts show the Nikkei bigger picture (hourly, chart, 1 week view) as seen by CTist speculators and the usual 15min (trading view) we're back into the level 3 zone again at which point the CTists short the top of the zone and long the bottom of it until we break out one way or the other.

You can see it following the 3 push cycle fairly nicely, once you reach level 3, even if it's going to continue onwards you'll always get a "failed first push" in the opposite direction as SM unloads all their profitable positions and reset into accumulation again.

and the odds are still very good of price coming back down into the 2 moving averages area (hourly chart) even if it is eventually headed further upwards.

evil speculation underway muahahahahaha!!!

 

[The Don]

Given that, in the absence of any other major news, the Nikkei seems to have an inverse relationship to the Yen then shorting seems to be a good call as long as the Yen continues to rise.

I presume that you're considering movements in the timeframe of minutes rather than weeks. Please let us know when you short and at what price....

Nikkei is currently around 14,300

 

[kevsta]

Given that, in the absence of any other major news, the Nikkei seems to have an inverse relationship to the Yen then shorting seems to be a good call as long as the Yen continues to rise.

I presume that you're considering movements in the timeframe of minutes rather than weeks. Please let us know when you short and at what price....

Nikkei is currently around 14,300

charts actually show you that, dotted green line is the Sell at 14285.

with equities indices I don't generally use a normal stoploss, but an opposite hedging long position opened at my maximum loss amount, to lock in the loss, but not cash out and actually have the money removed.

that way you get another chance, as it's possible to release the long in profit at the top of the next likely looking spike and quickly close out the short as it retraces. there's always another parabolic spike at some point if you're patient enough.

the hedging long is set to auto open at 14405 in case it runs the wrong way.

and no, not really minutes, the trades are usually intraday, a day or two, in at clear manipulation and out at the ADR target, unless during the course of the day you bust straight through the ADR and keep going, but generally its best to not be too greedy and get out at the ADR or just past it if possible.

and to be clear I'm not shorting this because the yen looks strong today, it's because I think I've seen exactly what I'm looking for in the last dozen bars on the 15min chart and it's in exactly the right place. let's see.