S&P Santa Rally or S&P Cliff Dive

[suby 10]

I realize this is the TA section of the website; however, given that the TA section is the most visited area of Traders Lab and that the majority of traders here are undoubtly S&P traders (Directly or indirectly) I would like to start a discussion in regards to market sentiment on the S&P going into the final stretch of this year.

 

Some of the greatest sources of wealth generation have been in one day market crashes (i.e. 1987, 2000, 2008, etc). On Thursday when speaker Beiner spoke the market dropped 8 points in a matter of 2 minutes. Nothing to wild; however, what was interesting to note about that 8 point drop was how fast and almost planned (algo execution) those 2 minutes were.

 

I realize you should probably never hold a bias towards your market direction; however, the last time the S&P approached the 1450 area we immediately proceeded to drop throughout the day to 1420. There is clearly a ton of volatility in today's market, specifically around each time a major economic announcment is made (pertaining to the fiscal cliff).

 

Where does everyone stand on the current state of the S&P. Do you feel we have room to run. Do you feel we are close to the roof and its only a matter of time until we dive off the cliff.

 

I am interested to hear where everyone stands on this issue.

[MightyMouse 12]

New highs in the next 3-6 weeks. New highs for the year and possibly an all time high.

[suby 10]

New highs in the next 3-6 weeks. New highs for the year and possibly an all time high.

 

Curious to hear how you've come to this MightyMouse

 

The relationship between the S&P500 and the VIX looks extremely tame right now but whats preventing this market from following off a cliff?

[MadMarketScientist 11]

I think it'll follow the last time we had a 'fiscal' issue ... drops towards the deadline and drops further after resolution. Then new highs in Feb\March

 

MMS

[MightyMouse 12]

Curious to hear how you've come to this MightyMouse

 

The relationship between the S&P500 and the VIX looks extremely tame right now but whats preventing this market from following off a cliff?

 

In spite of the cliff rhetoric, I think there will be a resolution soon. The shorts will be bloodied. There are lots of shorts which leads to buying pressure. 1500 is within spitting distance. I am comfortable thinking we will see s&p 1750 (arbitrarily chosen) before we see s&p 1250 again.

[suby 10]

In spite of the cliff rhetoric, I think there will be a resolution soon. The shorts will be bloodied. There are lots of shorts which leads to buying pressure. 1500 is within spitting distance. I am comfortable thinking we will see s&p 1750 (arbitrarily chosen) before we see s&p 1250 again.

 

MightyMouse,

 

Where can one obtain data pertaining to contracts short the S&P and Long the S&P...?

[MightyMouse 12]

MightyMouse,

 

Where can one obtain data pertaining to contracts short the S&P and Long the S&P...?

 

Delta ( contracts at ask-contracts at bid) is helpful. The rest is experience. More art than right edged science.

[suby 10]

Delta ( contracts at ask-contracts at bid) is helpful. The rest is experience. More art than right edged science.

 

Really Appreciate that!

[BlueHorseshoe 10]

MightyMouse,

 

Where can one obtain data pertaining to contracts short the S&P and Long the S&P...?

 

For a non-intraday view, take a look at Open Interest with the COT Report here:

 

Commitments of Traders - CFTC

 

Be careful about reading too much into the breakdowns though - commercials get it wrong sometimes (and have deep pockets to ride it out as they generally hedge physical stock in the underlying), and speculators often get it wrong as well, depending on what type of speculator is making up the volume in any given week.

 

BlueHorseshoe

[Tams 20]

here comes the cliff........................

[suby 10]

We are starring off the cliff as we speak

[MadMarketScientist 11]

Didn't they just jump off the cliff and ended up on another ledge with another cliff 2 months away? I second mitsubishi, at least these jokers are giving us something to trade.

 

Conspiracy theory says these guys do this crap so their wall street buddies can trade with inside info.

 

MMS

[suby 10]

Didn't they just jump off the cliff and ended up on another ledge with another cliff 2 months away? I second mitsubishi, at least these jokers are giving us something to trade.

 

Conspiracy theory says these guys do this crap so their wall street buddies can trade with inside info.

 

MMS

 

Could very well be at this point

 

At the end of the day its the big money that moves the markets really (i.e. the more informed traders not the noise traders)

 

I just can;t believe the price action this week.

 

Don't know what to expect if we break 1465; however, I still am looking for a juicy short in this envirnoment