Energy Weighs on the Market

By Jeff Pietsch | March 18, 2010 | 1:09 PM |  0 CommentsTweet This

Well, the Financials and Semi's aren't helping the bulls much either. Internals are seeing a slow deterioration along with price. I can't call this, nor do I foresee, a break down by any means (heck the VIX is hardly budging), but this market needs a rest!  Maybe the real question is whether we see a retrace that survives the final hour?

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The $QQV Factor

By Bob Barnes | March 18, 2010 | 9:22 AM |  0 CommentsTweet This

Old Crow brought the $QQV (NAZ100 volume index) to my attention yesterday. Actually, what he said was "What do you think of the $QQV?" and, frankly, I've never monitored it before. But, after a cursory look at the QQVs fractal behavior relative to the VIX, it does inspire some genuine curiosity.
Above and below are 10 minute Qs charts with QQV and VIX overlays.
Is anyone a bit surprised to see the correlation?

And, just to confirm a longer range correlation of the QQV and VIX, the lower 2 Qs charts are based on daily bars. There's really only a single divergence in these 2 charts as reflected in December, when Qs volume rose, but VIX declined. What happened there?
So, despite the complex formula of SPX put and call reconciliation involved in calculating the VIX, is it, in fact, just a reflection of volume? It certainly has an uncanny relationship to the QQV and that must be considered a major factor when evaluating the utility of the VIX as a trading tool for the Qs.
Of course, the VIX is a measure of the volatility of the SPX not the Qs. For that we have the $VXN, which looks a little bit different and I'll be probing some of those implications later this week.

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EUR/USD Suffers on Greece Worries

By Greg Michalowski | March 18, 2010 | 8:22 AM |  0 CommentsTweet This

The EURUSD has remained under pressure on the back of the Greece funding situation. The cost is too high (+310 basis points over comparable German bond yields) and they do not want to go to the IMF but they are not getting anything concrete from the EU.  The EU Trade Balance was better versus a year ago as exports show good strength.  The lower EURO seems to be helping in this respect and the news caused the EURUSD to bounce higher toward upside resistance. 

From a technical perspective, the EURUSD has remained below the 100 bar MA on the 5 minute chart currently at the 1.3684 level.  A move above this level should solicit some additional profit taking today. with the 1.3706 being the next target (200 bar MA on the same chart).

Looking at the hourly chart the 1.3681 level is also a key level.  It represents the 200 hour MA resistance level for the pair.  1.3671 is trendline support and the 50% of the low to high range comes in at 1.3627.  The market is back below the key 1.3691 level which has been a level the market has been paying attention to over the last few weeks.  Back in the meat of the trading range after peaking at 1.3817 yesterday.

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Day 14 Higher for SPY

By Jeff Pietsch | March 17, 2010 | 2:37 PM |  0 CommentsTweet This

The market is putting in a solid trend-day follow through to yesterday's FOMC inspired launch.  While internals look very strong, the SPY is seeing strong mid-day resistance at its second pivot of $117.20.

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My Favorite Trade: AUD/NZD Update

By Kathy Lien | March 17, 2010 | 2:37 PM |  0 CommentsTweet This

Last week, I wrote that shorting AUD/NZD is my favorite trade. At that time, I said that if the currency pair rallies back above 1.31, then the uptrend has resumed and my call is wrong. However, AUD/NZD tortured me and came within 2 pips of 1.31 (1.3098) before reversing sharply lower. There is no major support in the currency pair until 1.2775, but as indicators adjust to the movements in price, so have support levels. The 1.2850 level is now the new support and that's where I am targeting.

On a side note, I am kicking myself for not posting an official call because the moves have become deeply oversold in these currencies. However I think USD/CAD is going test parity (currently at 1.0105) and EUR/GBP is could fall to at least 0.8915 (now 0.8975).

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