Web Statistics The Sentiment Trader

Tuesday, 30 August 2016

Calm before the storm - Calm before the storm

Calm before the storm

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Calm before the storm ?



Calm before the storm
Calm before the storm



Calm before the storm

Is the stock market really in a situation of us seeing the calm before the storm... Is this true?

U.S. stocks closed lower Tuesday, with utilities falling 1 percent, as investors analyzed strong consumer data while keeping an eye on Federal Reserve ahead of Friday's jobs report.

"After coming off of Jackson Hole, ...all the attention is now to the jobs report," said Bob Phillips, managing principal at Spectrum Management Group. "If it comes out to be a decent number, I think the market will sell off."

Economists polled by Reuters expect the U.S. economy to have added 180,000 jobs in August.

Investors continued searching for clues regarding the Fed's next move Tuesday, after Fed Vice Chairman Stanley Fischer said the U.S. job market is almost at full strength. Fischer made his remarks less than a week after telling CNBC that the August jobs report will weigh on the central bank's decision on whether to raise interest rates.

"We are officially in a rate-rising market, even thought it's only been one rate rise," said Larry Rosenthal, president at Rosenthal Wealth Management Group. "People need to go back to basics and ... have lower beta portfolios." "Keep things simple."

The S&P 500 fell 0.2 percent, with utilities leading nine sectors lower and financials the only advancer. The financials sector has risen more than 3 percent in August, leading all 10 sectors.

Looking at the chart, the S&P has not done much for WEEKS!!! But as you can tell, this does not occur that frequently. Eventually this will break either way. We can say that the month of SEPTEMBER does tend to be a Negative type of month, so just a heads up. That is a statistic if look back 50 years. A break of 2150 spx would be bearish, but as we said, the smart money is doing nothing right now!. 

Calm before the storm


"The consumer confidence came in strong and that bodes well for the Fed to raise rates," said Peter Cardillo, chief market economist at First Standard Financial, but noted he does not expect the Fed to hike next month, rather later this year. "That shows consumer are cheerful and that spending will remain [high]."
Other data released Tuesday included the S&P CoreLogic Case-Shiller 20-City Composite index, which rose 5.1 percent year over year, versus expectations of 5.2 percent.

"These are the dog days of summer," said Bruce McCain, chief investment strategist at Key Private Bank. "It's a pretty boring time in terms of economic data and the net result is the market doesn't know what to do."
Stocks closed higher on Monday, with the S&P rising 0.52 percent, marking its 36th straight session without a 1 percent move higher or lower on a closing basis. At the close, Monday was on pace for the lowest trading volume day of the year.  -    Source : Cnbc.


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Monday, 29 August 2016

Are Bitcoins a Good Investment? - 4 Reasons They Are

Are Bitcoins a Good Investment? - 4 Reasons They Are

Since the end of 2015 the price of Bitcoin has steadily risen. As a result venture capitalists started pouring more money into the Bitcoin than they ever had before. Its really interesting because in an era when gold is not performing quite like many hoped and expected it to, Bitcoin is quickly turning into a safe haven for investments. 

If you have been on the fence about whether or not investing in Bitcoin is a good idea, here are four reasons you may want to jump on board. 

Reason #1 – There Is A Fixed Supply 

The one thing that will ensure the long term value of the Bitcoin is its fixed supply. Once 21 million Bitcoin have been released no new coins will be created. Experts expect this number to be reached by 2140. According to Chris Burniske of ARK Investment, the predictable growth of the Bitcoin and its fixed supply will make it a far more superior value than fiat currencies over the next several years. 

Reason #2 – Bitcoin Is Being Adopted For Various Practical Applications 

As Bitcoin becomes more ingrained in society, both businesses and individuals will need to own their fair share of it in order to function. As Bitcoin becomes the go to currency for transactions all over the world, demand will drive the price up which means now is the perfect time to invest in it. 

#3 – It Is The Number One Digital Currency 

While there are other digital currencies available, none can compete with the Bitcoin. At least not now or in the near future. Bitcoin has the largest market capitalization of any other digital currency. All the top digital currency wallets use Bitcoin. There are also several apps such as Abra and Circle that use Bitcoin for the sole purpose of transferring money. Bitcoins security and liquidity properties make it a very difficult digital currency to dethrone. 

#4 – Bitcoin Is Currently Being Undervalued 

When you compare Bitcoin to Gold you will see it is being undervalued. Just like gold, Bitcoin is also limited in supply and cannot be counterfeited. However, there is one thing that gives it an edge over gold and that's its utilitarian value. While gold is great for making jewelry and various other industrial production processes, when the price increases it is no longer as useful. 

Bitcoin on the other hand becomes more useful as more people will start to use it to transfer money and make financial transactions. 

Whether or not you should invest in Bitcoin will depend on your investment goals and the amount of risk you are willing to take. As with all investments, you should only invest what you can afford to lose. 


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Sunday, 28 August 2016

One trader has a strategy to win big from the Fed's rate ping-pong match

One trader has a strategy to win big from the Fed's rate ping-pong match

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One trader has a strategy to win big from the Fed's rate ping-pong match



One trader has a strategy to win big from the Fed's rate ping-pong match
One trader has a strategy to win big from the Fed's rate ping-pong match



One trader has a strategy to win big from the Fed's rate ping-pong match

One trader has a strategy to win big from the Fed's rate ping-pong match... What it is?

Well, One trader has a strategy to win big from the Fed's rate ping-pong match ...so here it is below.

The markets remain confused after Federal Reserve chair Janet Yellen's Friday morning speech at Jackson Hole. However, one trader is making a bet in case a rate hike becomes more likely.

Todd Gordon of TradingAnalysis.com sees a possible interest rate hike on the horizon, and believes that certain sectors are set for some big moves.

"The sectors that are responding the most are those interest rate sensitive sectors," Gordon said Friday on tv  "Trading Nation." These include consumer staples, which Gordon believes are in danger of a move to the downside should the Fed follow through on its hints to hike rates.

"Right now, it looks like the markets are starting to price in a Fed rate hike," he added. "If interest rates move up, that means the interest rate-sensitive sectors like XLP should move to the downside," Gordon said, referring to the exchange traded fund (ETF) that tracks consumer staples stocks.

Yellen said that "the case for an increase in the federal funds rate has strengthened in recent months," but pointedly refused to set a timetable for a possible increase of the federal funds rate target.

The XLP did see a drop following the Fed chair's speech as the markets attempted to decipher her words. Since it offers a dividend yield of nearly 3 percent as compared to 2 percent for the S&P 500, the ETF is relatively sensitive to bond yields. The ETF holds stocks such as Procter & Gamble, Coca-Cola, Philip Morris and Altria.

Looking at a chart of the XLP, Gordon determines that the ETF is on its way down. He looks at a previous drop from $56 to $54 to determine that the recent highs of $55 could go down by the same $2 different to $53.

Looking at the XLP chart, you can see how well this has been traveling in an upwards trend. So far so good, but we think there could be more downside to come, if this rising support line BREAKS  over the next few weeks, and the FED KEEP up this PRESSURE talk about the INTEREST RATES!.  That could be a likely scenario and a good trade to watch for. 


As a result, Gordon wants to buy the October 55-strike puts and sell the October 53-strike puts for $0.81, or $81 per options contract. Gordon's trade has him risking $81 to make a total of $200—a whopping 147 percent return.

"If XLP moves back above the $55 mark, I want to cut the trade, protect any premium that's remaining, and move on to the next trade," said Gordon. "But otherwise, we should be able to go down to the $53 in the face of a potentially increasing interest rate once this Fed ping-pong match is over." -    Source : Cnbc.


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