Monday, August 22, 2011

State of World Markets via Country Fund ETF's: Unpleasantries

Captain obvious here, but things are pretty ugly around the world markets. Over 90% of these country ETF's are below their 200 day moving averages, indicating bear market territory. Only three of these ETF's are even up on the year. The market is now (and has been for a few weeks) guilty until proven innocent. If the market starts to rise on bad news, then I'd take notice for potential longs. Otherwise, it's bear time.


Ticker
Date/Time
Fullname
Close
% Above/Below
 200 SMA
YTD Change
TUR
8/22/2011
  Turkey Investable Market Index
44.58
-40.7
-32.67
EWI
8/22/2011
  Italy Index 
12.89
-34.47
-21.31
VNM
8/22/2011
Market Vectors Viam  
18.18
-29.43
-30.56
EIS
8/22/2011
  Israel Capped Investable Market
43.76
-28.65
-27.69
EWG
8/22/2011
  Germany Index 
19.62
-28.62
-18.05
EWO
8/22/2011
  Austria Investable Market Index
17.07
-28.41
-23.56
EWD
8/22/2011
  Sweden Index 
24.49
-27.35
-21.58
RSX
8/22/2011
Market Vectors Russia Trust Sbi 
30.47
-25.57
-19.63
EPOL
8/22/2011
  Poland Investable Market Index
27.9
-24.7
-16.94
EWN
8/22/2011
  Netherlands Investable Market I
17.33
-23.46
-17.83
EWQ
8/22/2011
  France Index 
20.96
-22.97
-14.27
EWY
8/22/2011
  South Korea Index 
50.31
-22.23
-17.78
EWZ
8/22/2011
  Brazil (Free) Index 
60.15
-22.21
-22.29
FXI
8/22/2011
 FTSE China 25 Index 
35.67
-20.68
-17.22
EPI
8/22/2011
Wisdomtree India Earnings 
19.94
-20.15
-24.44
EWP
8/22/2011
  Spain Index 
33.75
-18.95
-8.14
AFK
8/22/2011
Market Vectors Africa 
28.18
-16.84
-19.9
EWT
8/22/2011
  Taiwan Index 
12.93
-16.01
-17.22
ECH
8/22/2011
  Chile Investable Market Index 
63.46
-15.61
-20.28
EWK
8/22/2011
  Belgium Ivestable Market Index
11.91
-15.09
-9.29
EIRL
8/22/2011
  Ireland Capped Investable Market
18.44
-15.04
-9.21
SPY
8/22/2011
SPDR S&P 500 
112.73
-14.12
-10.35
EWH
8/22/2011
  Hong Kong Index 
16.52
-13.99
-12.68
EWA
8/22/2011
  Australia Index 
22.36
-13.8
-12.11
EWU
8/22/2011
  United Kingdom Index 
15.61
-13.19
-10.13
EWC
8/22/2011
  Canada Index 
27.9
-13.02
-10
MES
8/22/2011
Market Vectors Gulf Shares 
19.98
-12.35
-15.55
EWJ
8/22/2011
  Japan Index 
9.45
-11.42
-13.38
EWS
8/22/2011
  Singapore (Free) Index 
12.31
-11.01
-11.12
EWW
8/22/2011
  Mexico Investable Market Index
54.96
-10.56
-11.24
EZA
8/22/2011
  South Africa Index 
63.55
-10.04
-14.9
EWL
8/22/2011
  Switzerland Index 
23.26
-9.56
-7.26
EWM
8/22/2011
  Malaysia (Free) Index 
14.29
-1.85
-0.63
EPHE
8/22/2011
  Philippines Investable Market 
24.25
0.75
-2.73
THD
8/22/2011
  Thailand Investable Market Index
65.93
0.97
2.04
ENZL
8/22/2011
  New Zealand Investable Market 
31.15
2.12
6.02
EIDO
8/22/2011
  Indonesia Investable Market Index
31.24
4.13
7.35

Saturday, August 13, 2011

For The History Books: Unprecedented Market Action

The market has been extremely wild to say the least. I will admit, it punished me hard. Going through such challenging period makes you reflect and question some things. I question the trading decisions I've made. I question my trading system and its ability to handle such a volatile period. I question my own sanity at times. But since I am writing this post, it means I am not dead. And since I'm not dead, this experience can only make me STRONGER.

I got slaughtered the past couple weeks, and I wonder: could I have planned or anticipated this better?  At this point, I'm not really sure yet. But when I look at the market stats from the last week, I realize it is hard to plan for things that have never happened before. That's still no excuse, but here are some items to reflect on.

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- S&P Downgrades US Debt: NEVER HAPPENED! This is what I call a BLACK SWAN.

- Dow Jones Ind. 4 straight days of 4% moves: This has only happened 5 other times in history. November 2008, the 1987 Crash, then the 1929 - 1932 period. Rare indeed!

- Dow Jones Ind. 4 straight days of 400 point moves: NEVER happened. Granted it is all relative to the actual balance of the index. But still...

NYSE McClellan Oscillator (ratio adjusted): On 8/8/11, it hit -142.58. It has only been below -140 7 other times, the last being the 1987 crash.

Nasdaq McCLellan Oscillator (ratio adjusted): On 8/8/11, it hit -118.82 This is the first time it has been below -118 since the 1987 crash period. It hit below -140 on the crash day.

Zweig Breadth Indicator: It hit a low of 27.03 this week. It is a breadth overbought/oversold measure. It hasn't been this low since November 2008, one random day in 1990, then 1987 crash. Pretty rare.

NYSE Advance / Decline Volume: 90% up/down 4 straight days in row. If you take the NYSE volume of advancing issues compared to the volume of declining issues you get this indicator. We have NEVER had 4 90% days (up or down) in row ever. This lets you know how 'one way' the market has been, in either direction.

$SPX down over 13% in 5 days: Last time it happened was Oct/Nov 2008, 1987 crash, then 1940. Not a regular occurrence.

VIX 74% above its 10 day SMA: NEVER been this high. The day after the Flash Crash it was 67% over the 10 SMA.

VIX moved up 105% in 3 days: NEVER happened. The previous 3 day record was 80% in 2007.

VIX up 50% in one day: Only 5 other times in history.

*** Follow Sentiment Trader on Twitter and you will learn more. Here are some of his tweets from this week. Let that perspective soak in:

"Today has seen the widest-ever range in the NYSE TICK indicator (per Bloomberg data). From -1538 to +1560. $$"


"The only other times the a/d line has been this skewed were 5/13/40 and 5/21/40. Yeah, 70 years ago.$$"

"Nasdaq up/down volume on pace for worst reading ever (dating to 1984). The 2nd-worst reading was last Thursday.$$Don't have final figures yet, but this may be the worst-breadth day in history (since '40). 66 stocks down for every 1 up. $$"
"VIX jumps >30% twice in a week. The only one i show is 10/19/87."
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This was no garden variety pullback. Most indicator extremes can only be compared to previous crash periods (2008, 1987, 1929). When indicators get this extreme, they basically loose all meaning. I think it is safe to say that we just went through one of the craziest periods in market history!

There are lessons to be learned. I just need to clearly identify these lessons and create an action plan to address them. I hope you all can do the same.

Good trading.