Financial topics

[Higgenbotham]

As far as the "golden cross" concept, there are exceptions. In April 1930, the Dow nearly made a golden cross as it peaked and plummeted toward the 1932 low. In November 1973, the Dow barely did make a golden cross as it peaked and plummeted into the 1974 low. I have the charts and can upload them but it's kind of a pain. Unfortunately, I don't know of any free links that show this.

[OLD1953]

What periods are you using? Simple moving averages for variable periods are easy to set up on googles stock chart. OFC, if you use something like 15 day and 50 day, they cross over quite a bit, and aren't very predictive, IMHO. Not that I'm a chartist anyhow.

[Higgenbotham]

What periods are you using? Simple moving averages for variable periods are easy to set up on googles stock chart. OFC, if you use something like 15 day and 50 day, they cross over quite a bit, and aren't very predictive, IMHO. Not that I'm a chartist anyhow.

The "golden cross" is the 50 and 200 day. From post on previous page:

The index’s 50-day moving average is 0.2 percent away from exceeding the average price for the prior 200 days. The formation, known as a “golden cross,” will occur for the first time since 2010 and is historically a signal that more gains are likely to follow, Birinyi Associates Inc. said.

OLD, I personally don't use moving average crosses to try to predict the market. I don't know of any free Internet sites that show the golden cross from as far back as 1930 or 1973. It seems to me that the overall environment might be quite similar to those times, both of which, oddly enough, the golden cross indicator failed badly.

It appears to me that this is one more false indicator the herd may be chasing, which is another ingredient in the recipe for possible panic.

[Higgenbotham]

January 29, 2012

PARIS: French President Nicolas Sarkozy insisted Sunday that measures taken to end the financial crisis threatening Europe and the rest of world had started taking effect.

"Europe is no longer on the edge of the abyss," he said, adding that "the financial crisis is calming down."

"The elements of a stabilisation of the financial situation in the world and in Europe are in place," Sarkozy said in an hour-long television interview to unveil reforms aimed at lifting France out of the economic doldrums.

http://www.brecorder.com/world/global-b ... kozy-.html

May 1, 1930

“While the crash only took place six months ago, I am convinced we have now passed the worst and with continued unity of effort we shall rapidly recover. There is one certainty of the future of a people of the resources, intelligence and character of the people of the United States—that is, prosperity.”

—Herbert Hoover, Address at annual dinner of the Chamber of Commerce of the United States

[Higgenbotham]

This chart was posted 3 weeks ago and was accurate as of January 9. It can be viewed for reference to the dates and time periods cited below. January 26, 2012 was last week's stock market high and the high of the move since the August crash.

October 11, 2007 (all time high) - January 26, 2012 = 1568 days
May 19, 2008 (retrace high) - January 26, 2012 = 1347 days
May 2, 2011 (2011 high) - January 26, 2012 = 269 days

1568 days is approximately 1/2 of a "pi cycle" of 3141 days.

1347 days is approximately 6/7 of 1568 days.

269 days is approximately 1/5 of 1347 days.

While a forecaster could have made a case for an important high occurring last week (or could make this case in hindsight) I would not have expected it, as there were stronger resonances on other dates. But it was the Fed meeting and it appears the Fed can still influence the market.

I'm not actually trying to make a case for anything based on these calculations, but they do exist.

http://i44.tinypic.com/2wqzc5d.jpg

[Trevor]

What else can he say? He's got to put the best spin possible on things, particularly since he is up for reelection this year. He's got a decent chance of losing, especially with France's downgrade. Of course, some are saying this not because of politics but because they have to convince themselves that we will somehow avoid what's coming, avoid a crash, even when the evidence says otherwise.

[aedens]

http://confoundedinterest.wordpress.com/

[Higgenbotham]

http://confoundedinterest.wordpress.com/

Also,

http://confoundedinterest.wordpress.com ... ed-only-2/

Inventories rose by $56 billion in Q4, the largest build since Q3 2010. This contributed 1.94 ppts to growth (70% of the headline rate of growth) which is why real final sales, which exclude the impact of inventories, rose by just 0.8% in the quarter.

[OLD1953]

There are two things about technical indicators that I don't like, they try to predict stock movement from past value and they become self fulfilling prophecies. A widely believed technical indicator that shows positive can easily pull up a market, even if it sent a false signal. This is no different from computer programs that chase the market by predictive stock prices, if they ignore the actual value of the company and the actual economic trends, then they will have the same problems of self fulfilling success. Large brokerages use analyst input to stock trading programs, but it's all weighted vs the constantly generated internal "charts" as well.

Every prospectus says "past performance is not an indicator of future success", and charts fly directly in the face of that statement.

I thought the periods had been stated, but looking back I just didn't see it. I'm familiar with the google charts and quite a few other sites as well, I pop up the indicator lines to make sure I'm not fooling myself about long term trends.

We see that inventory bump almost every year in December, but it's often touted as "unexpected" news. Kind of like the gas supply "surprise" we have almost every summer, even when the public is driving less and staying home more. I guess I'm getting old, because this nonsense has passed from amusing to irritating.

[aedens]

I agree Old in a very large regard but TBTF appears TBTS " to big to survive". Many will regard the struggle of the individual against the central planners as mechanisms we have covered for our regard to GD to underpinnings of construct.
I alluded to Hume on a few facets and many others as all do to not assert a ideological view but of course as Hume observed and countless others it will not matter. Hume conveyed the problem of induction, and the distinction between fact and value.

"I guess I'm getting old, because this nonsense has passed from amusing to irritating." Nope, denied since you see the world and the actors IMO