DISCLAIMER

PLEASE READ THE DISCLAIMER AT THE BOTTOM OF THIS PAGE WHICH APPLIES TO ALL CONTENT IN THIS BLOG AS WELL AS ANY OTHER MATERIAL FROM WE ARE FUTURES TRADERS LLC. READING ANY CONTENT BELOW CONSTITUTES AN AGREEMENT BY ALL READERS THAT THEY HAVE READ AND AGREE TO ALL THAT IS SET FORTH IN THE DISCLAIMER AT THE BOTTOM OF THIS PAGE.


Tuesday, June 05, 2007

S&P 500
I apologize for having been so negligent in keeping up here. I have been juggling alot of different things, and have had tremendous internet problems at my home. Satellite internet sucks for the record!
As you can see, the Jaws of Death have shown up for the stock market. This is a pattern that has led to many severe declines in the past, so why am I still bullish and heavily long stocks?
Notice at the bottom, the heavy long position the commercials have established. What I think will happen is that the rally will continue for awhile, the commercials will gradually shift away from the long side, and if this happens, yours truly will exit his longs.
The trick with this formation is that is sometimes can persist for a few months to 6 months before anything happens. As a result, for the time being, it is just watch this closely for signs that it is leading to trouble. Sorry for the poor spacing, Blogger is not in the mood apparently tonight to allow me to put spaces between the paragraphs.

6 comments:

rikkicitos said...

welcome back!

i have been wondering about your take on the continuing divergence twixt stocks and bonds, since that is something you have often focused on... thanks for the update.

rich

Chris Johnston said...

Ironically we got the big down day right after I posted this. I still think we will hold up, but time will tell. This bond market is surprisingly weak, even though I predicted this at the beginning of the year, I did not think it ( the bond market ) would be as weak as it is now at this point.

graphrix said...

Yes satellite internet sucks. Sorry that you have to deal with that.

I don't follow bonds like you do but I have been surprised by the tailspin they have been in. I am still subscibed to the mortage market guide and for about the last 20-30 days I have been getting a warning phone call from them about every other day with drops from 16 bps to 28 bps.

I was hoping you would have an update on bonds soon too. I'm thinking we have little more downward movement to go. Looking at the mortgage bond chart tomorrow could see another break through the support level.

Chris Johnston said...

I will post on Bonds next. I think we might go a little further, but are close to the low there.

Lane said...

Great Blog. Check out
http://www.TraderBlogs.com
too. I think you'll like that one.

I also frequent
http://www.TradingEducation.com
- great articles there too!

Chris, do you talk about Forex much?

Thanks!

Chris Johnston said...

I do not cover Forex or trade it. I do dabble in currencies and occasionally will post something there. Thanks for the nice comments.