20090131 - EURPLN, CHFPLN

The EURPLN seems to continue its rally:



The uptrend still remains very strong. The high of 4.4656 hasn't been broken yet (price is still in error margin); nevertheless the odds are it will be crossed and new buy signal will be generated.

The CHFPLN has similar situation, however, the level of 3 PLN per 1 CHF has psychological meaning:



Therefore I would also wait for clear and confirmed breakout this level, before giving out a buy signal.

Generally speaking, both currencies are in uptrend and there is no sign of trend reversal as of now. Both currencies are near the important levels and any scenario is possible. We shall watch them carefully in the incoming week.

Also, there are economic related protests and riots are occurring around the world from Iceland to China (here).

Sources:
[http://hubpages.com/hub/Worldwide-Economic-Protests-and-Riots]

20090130

Today was rather boring session - greater volume, but still not much of action in the market:



Unfortunately, this week did not shown us the direction of market. It seems that traders are very careful now. Generally speaking, there is not much appetite for risk now in all markets.

Brian's video summarizing the week (here) - quite pessimistic.

Another US bank gone (here).

Sources:
[http://www.marketwatch.com/news/story/Regulators-close-three-more-banks/story.aspx?guid={882CF913-54E4-4C79-AABC-C5B1F4FD9745}]

20090129

There was almost no trading at today's session:



Yesterday's rally in US market did not help WSE. The situation haven't changed - the WIG Index is at the edge of fall. Very small volume makes it even more dangerous. Nevertheless, the market is still above the yearly low and we still have to wait for clarification.

The 850 million USD stimulus plan was introduced in US. There is some discussion about gold fundamentals (here).

An interesting article about hedge funds industry in 2009 (here).

Sources:
[http://seekingalpha.com/article/117279-850b-stimulus-plan-signals-gold-take-off]
[http://seekingalpha.com/article/117289-hedge-funds-will-the-bloodbath-continue-in-2009]

20090128

Today session's volume was surprisingly small:



The volume is declining, thus it does not confirm the downtrend.  Nevertheless, we are still on edge of yearly low. The US market had a rally today (Brian's video here), therefore we can expect high open on WSE as well.

20090127

The WIG Index lost -2.36% today:



The situation hasn't changed too much and it's still quite dangerous - the WIG Index is floating just above the important level of 24100. There is long- (weekly) and medium-term (daily) downtrend. The volume was small and the charts are giving no reason to open long positions, but we still didn't cross the yearly low.

Brian's video (here) also demonstrate lack of decision in US market.

The PLN interest rates were cut by 75 points to 4.25% (here). There weren't any special reaction on EURPLN or CHFPLN charts.

It seems the recession is well visible also in Poland now (here or here).

Oil still shows quite a volatility (here).

Sources:
[http://gielda.onet.pl/0,1904662,wiadomosci.html (via Google Language Tools)]
[http://gielda.onet.pl/0,1905119,wiadomosci.html (via Google Language Tools)]
[http://news.money.pl/artykul/rpp;ostro;tnie;stopy,215,0,422615.html (via Google Language Tools)]
[http://www.marketwatch.com/news/story/Oil-tumbles-9-market-looks/story.aspx?guid={BC12E984-63C6-4E6B-B35A-5CCDEA7D5AC1}]

20090126

The WIG Index did not cross the 24100 today:



Small volume tells us that the traders are waiting and the market is generally undecided. The WIG Index is in downtrend, therefore odds are we will cross the level of 24100. Aside from that there is not much to say and as we are not interested in short positions, we shall wait for further events.

Brian, in his daily video, suggest rather to stick to day trading, unless we get better idea what's going on.

Very interesting interview with Sphinx founder, but not owner anymore (here).

There are some thoughts for incoming inflation (here) and decreasing earnings (here).

Interesting, Bloomberg noted that divorces' number are increasing among finance (here).

Sources:
[http://wyborcza.pl/1,75480,6177176,Zagadkowe_pozeranie_Sfinksa.html (via Google Language Tools)]
[http://seekingalpha.com/article/116297-evidence-that-big-inflation-is-coming]
[http://seekingalpha.com/article/116442-monday-outlook-earnings-or-lack-thereof]
[http://www.bloomberg.com/apps/news?pid=20601213&sid=a0c4BFIwlSYU]

20090124 - EURPLN, CHFPLN

The EURPLN continued its rally:



Higher high generates buy signal. Weekly low is at the level of 3.87.

The CHFPLN is still in uptrend and generated buy signal as per higher high:



The weekly low is at 2.57.

Not much can be said as both currencies are in uptrend. Unfortunately for polish mortgages' owners there is no sign of trend reversal.

The OECD (Organisation for Economic Co-operation and Development) publishes reports and forecasts for about 30 member countries. The one for Poland can be found here.

Sources:
[http://www.oecd.org/dataoecd/6/32/20213254.pdf]

20090123

The WIG Index is in really interesting situation:



The WIG Index touched today the yearly low from 27th October 2008 (actually index has broken this level for ca.100 points, but it's still in the error margin). Breaking this level would generate strong sell signal and target price ca.20800 (from triangle).

We have to wait until next week for possible clarification (in case of downtrend continuation). I guess, the weekend will be quite nervous for all positions' holders.

Some thoughts on bank nationalizations in Bloomberg's video.

Jim Rogers forecasts economic disaster in UK and urges to immigrate (here).

Sources:
[http://www.thefirstpost.co.uk/people,1883,soros-business-partner-jim-rogers-predicts-end-of-sterling,72083]
[http://business.timesonline.co.uk/tol/business/economics/article5555898.ece]

20090122

The WIG has shown extreme volatility today:



We are still above critical level of 24100, but it's very hard to forecast the market now. It could be the long-awaited second bottom or just the steep before fall continuation. In situation like this, it's better to stay with money.

Brian Shannon from AlphaTrends blog suggest only day trading in his daily video (here).

Today's number of worse-then-expected information in US market has its weight (here or here).

Microsoft announced layoffs (here) and it confirms, that the information technology sector is no longer safe-heaven for computing professionals (Google here; IBM, Sun and Intel here). On the other side, Google earning's report was better then expected (here). The Certification Magazine's Salary Survey 2008 could be interesting source of information for future trends (here).

As for polish economy, two interesting reports were published: average salary and employment report (here via Google Language Tools) and real estate transaction prices (here via Google Language Tools), which suggest the offers are higher 10-15% than real prices).

Sources:
[http://www.marketwatch.com/news/story/US-Stocks-Continue-Slide-Dow/story.aspx?guid={3BCE165C-2277-4E48-940A-71BEB1B75695}]
[http://www.marketwatch.com/news/story/Microsoft-reports-drop-earnings-plans/story.aspx?guid={663A9759-FA41-4DE9-8397-A7EC546BEDA0}]
[http://www.marketwatch.com/news/story/Googles-profit-slips-company-beats/story.aspx?guid={19E90AF2-E02A-4331-A2B7-26109E2DAD9A}]
[http://www.certmag.com/read.php?start=0&in=3656]
[http://www.thedisciplinedinvestor.com/blog/2009/01/22/market-notes-thursday-january-22-2009/]
[http://www.egospodarka.pl/37156,Zatrudnienie-i-place-polskie-firmy-2009,1,39,1.html (via Google Language Tools)]
[http://www.egospodarka.pl/37163,Ceny-transakcyjne-nieruchomosci-XII-2008,1,39,1.html (via Google Language Tools)]
[http://www.forbes.com/2008/11/26/google-layoffs-contractors-tech-enter-cx_bc_1126google.html]
[http://www.theregister.co.uk/2009/01/22/it_vendor_layoffs/]

20090121

Today's session has shown some volatility:



Regardless impressive rally, the WIG Index has made lower low and that generates sell signal. We are close to the important level of 24100 and there are various emotions in the market.

Small cap companies could give us some clues. Let's focus on the sWIG80 chart:



and also the mWIG40 chart (the breakout is clearly visible):



We can note, that the both indexes have broken their supports and are making the lower lows now.

Nevertheless, we still are within 24100-29600 area and before we leave that we shall not take any action.

The Holder portal published another report (here via Google Language Tools, also note pdf file) about polish mutual funds actions. It seems mutual funds are increasing their exposure for polish shares (especially in electroengineering, information technology and chemicals sectors).

Sources:
[http://www.holder.com.pl/fm.shtml?id=4144&fm=11154&c=38400729002 (via Google Language Tools)]

20090120

The WIG Index continued its fall (also sell signal was generated as per lower low):



The gap form 19th November 2008 has been fully covered. Right now the WIG Index does not show any sign of recovery. There is not much to say; however, note that we are still moving in the 24100-29600 area.

It seems the global crisis did not spare polish economy and some polish companies are preparing mass layoffs (here). Unemployment forecast are quite big (here). Nevertheless, in my opinion Poland won't be hit as hard as more developed countries.

Barack Obama was sworn as the 44th US president (here).

Bank sector took another hard hit today (here).

The SeekingAlpha portal published an interesting chart about US economy: median income vs. median house price (here).

Airelon (from Investor and Trader blog) created quite interesting video about individual's finance (here).

Sources:
[http://www.marketwatch.com/news/story/Obama-says-Americans-meet-challenges/story.aspx?guid={EF817384-CFDE-4AB5-B2C1-954AA6FDB639}]
[http://www.marketwatch.com/news/story/Banks-battered-sector-matches-worst/story.aspx?guid={3746153F-B946-4C22-8870-66BC92C0B31B}]
[http://gielda.onet.pl/0,1900968,wiadomosci.html (via Google Language Tools)]
[http://praca.money.pl/wiadomosci/artykul/700;tys;polakow;moze;stracic;prace,97,0,419937.html (via Google Language Tools)]
[http://seekingalpha.com/article/115464-new-home-prices-vs-median-income-chart]

20090119

First session in this week didn't show much of optimism:



The WIG Index open was high, but we have finished barely above the 168% Fibo level (as per picture). The RSI and CCI seem to confirm the fall. The sell signal was generated (as per lower low), nevertheless we are still above the 24100.

We are still in struggling between those two levels (24100 and 29600). There was no session in US today.

It seems the US treasury notes are no longer popular among foreign investors (here).

Obama Barack will be sworn tomorrow as the 43th president of United Stated of America (here).

Another bank in UK with financial problems - Royal Bank of Scotland (here). Overall commentary on bank bailouts here.

Sources:
[http://seekingalpha.com/article/115246-foreign-governments-dumping-u-s-assets]
[http://www.marketwatch.com/news/story/Support-Obama-strong-economic-mood/story.aspx?guid={A63C3368-1A8A-409F-BE17-B86410A675CC}]
[http://www.marketwatch.com/news/story/RBS-shares-slammed-after-bank/story.aspx?guid={66ECB27B-0895-4A08-BDBC-655340762EB3}]
[http://money.cnn.com/2009/01/19/news/loans.banks.fortune/index.htm]

20090117 - EURPLN, CHFPLN

EURPLN has generated long-term buy signal (the high of 4.2050 taken):



CHFPLN has similar situation (buy signal generated after taking the high of 2.8196):



As for now, both uptrends stay intact and there is nothing suggesting trend reversals.

There are good news for polish mortgages - banks will be forced to accept payments in credit's currency, therefore the spreads will have to be more competitive.

20090116

The WIG Index had the highest volume ever:



I don't know how to interpret this big volume. Right now it looks the index bounced from trendline (and also from gap), however the RSI and CCI are suggesting south direction rather. Break of last high also suggest continuation of downtrend, at least on daily basics.

Generally speaking, the market gives mixed clues. It's hard not to get impression (it's subjective), that market is recovering. Nevertheless, charts are not suggesting to take any long positions yet. The chart still looks bearish in wider timeframe:



Brian's video for today here.

A rather interesting article about leveraged ETF funds (here).

Sources:
[http://online.barrons.com/article/SB123155505487470527.html]

20090115

The WIG Index continued its fall:



The CCI also confirmed south direction today. The WIG Index is near the gap from 11th Nov 2008 and also 168% retracement from last daily swing (ca.25400) - those two areas can provide support. However, any support in downtrend is just potential support before it is actually tested.

Money.pl portal gathered few forecasts for Poland's GDP in 2009 (here).

Crude oil shows tremendous volatility (here). Morgan Stanley seeks a supertanker to store crude oil. About 80 million barrels of crude oil are being stored in tankers, the most in 20 years (here).

More bad news on US housing market - foreclosure filings have risen dramatically on year-to-year basics (here). Nevertheless, also a good ones can be found - lower average rates  (here).

Sources:
[http://www.money.pl/gospodarka/wiadomosci/artykul/rostowskikryzys;nas;nie;dotknal,227,0,413923.html (via Google Language Tools)]
[http://www.marketwatch.com/news/story/Oil-tumbles-10-economic-troubles/story.aspx?guid={483E6FFB-04AF-47B5-9411-5450493124B8}]
[http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aZ8zTUi12IkY]
[http://www.marketwatch.com/news/story/Benchmark-30-year-mortgage-falls/story.aspx?guid={781E33BA-96DE-40EB-86A4-A48DBE686DA1}]
[http://www.marketwatch.com/news/story/US-foreclosure-filings-2008-rose/story.aspx?guid={1B0E993C-88D5-44B6-8C50-C02410082B5E}]

20090114

The WIG Index has broken weekly low (26700):



That generates sell signal in long-term, also confirmed by RSI and volume. Nevertheless, we are still within 24100 - 29600 area and it's better not to make any bets before we get out from those levels.

The CHFPLN today has broken its high (2.82) and that generates long-term buy signal (chart thanks to ChartStation):



That is not pleasant situation for polish mortgage owners.

The polish property market is in interesting stage. Let's take a look at polish property prices (charts thanks to DomiRynek portal):



We are more interested in second hand prices as offers from developers are focusing on not-yet-built houses. We can note a huge drop (from ca.8350 PLN to ca.7500 PLN per square meter, makes ca.11% drop) in Q3 2007.  Nevertheless, since then there was no big differences on yearly basics. We can also see the charts filtered for Warszawa's, Krakow's or Wroclaw's offers, but there is nothing like the huge price drops in US or UK.

Of course, the developers are adding more value for the price (like a finished flat, car garage, etc.), however the most of transactions are done in second hand market. Also, there is an interesting report for December 2008 (here via Google Language Tools).

Sources:
[http://www.domirynek.pl/chart/time_avgprice/flat/-/-/-/fsthand/-/]
[http://www.domirynek.pl/chart/time_avgprice/flat/-/-/-/sndhand/-/]
[http://inwestycje.pl/nieruchomosci/raporty_nieruchomosci/raport_rynku_mieszkaniowego___grudzien_2008;46946;0.html (via Google Language Tools)]

20090113

The WIG Index is in interesting situation:



Breaking 26700 would generate long-term (weekly) sell signal (if fact, the index reached 26651.31 today, but it's still within 3% error margin). Overall situation is an interesting one, but we still shall wait until 29600 or 24100 is broken.

It seems there will be more disruptions in Russia's natural gas transfer. After few hours, the transfer was stopped again (here via Google Language Tools).

Ben Bernanke wants more government action and additional money to strengthen the financial system (here).

Brian's daily video here. Brian has given very nice tutoring today.

Sources:
[http://news.money.pl/artykul/druga;odslona;gazowej;wojny;kurki;znow;zakrecone,184,0,417720.html (via Google Language Tools)]
[http://www.marketwatch.com/news/story/Bernanke-says-no-recovery-without/story.aspx?guid={887B399E-613E-4CA0-A8ED-6B1ABA78738C}]

20090112

The WIG Index continued his fail:



Today's session also negates target from triangle (we probably will also have to alter the upper trendline). Some forums' users and bloggers are convinced this is the bottom of the market, but overall situation is confusing. Let's wait for 29600 or 24100.

The transit of natural gas to Europe should be soon restored, as Ukraine and Russia reached agreement (here).

There are tons of information about Madoff's scam already in the Internet, however there is an interesting document floating around  (here), titled "The World's Largest Hedge Fund is a Fraud". Interestingly, this paper has been sent to SEC in 2007.

Brian's daily video here (quite pessimistic whatsoever).

Sources:
[http://online.wsj.com/documents/Madoff_SECdocs_20081217.pdf]
[http://seekingalpha.com/article/114041-america-is-this-the-end-of-an-era]
[http://www.marketwatch.com/news/story/Russia-Ukraine-reach-deal-natural/story.aspx?guid={730CFC71-1681-4CB9-B4CB-7AB0593A615B}]

20090110 - EURPLN, CHFPLN

The EURPLN failled from its top (charts from ChartStation):



Nevertheless, the EURPLN is still in long- and medium-term uptrend and the odds are 4.2 will be taken.

The CHFPLN has touched the Fibo 61.8% retracement  level:



Situation is similar to the CHFPLN. As the long- and medium-term trend direction is north, the odds are the 2.82 will be taken.

The latest swings can be still called a correction. However, the currency market in the past year was everything but forecastable; we shall observe it continuously.

Good news for polish mortgages owners are that the lowered Swiss Frank interest rates (this post) should have already lowered the theirs payments.

20090109

The WIG Index covered the gap from 5th Jan:



The preferable scenario from yesterday's post failed and the market is now below the trendline (ca.350 points). Nevertheless, the market stills look quite optimistic in medium- and long-term - as least unless the low from 23rd Dec (26700) is broken.

Open Finace published quite interesting rating of selected polish investment funds (here). We should note exceptional returns from bond funds. As per Market Cycle theory (this post) after rally in bonds comes rally in stocks.

The session in US was quite rough, as pointed by Brian Shannon in his video.

Smith Barney, Citigroup Inc.'s brokerage unit, might form joint venture with Morgan Stanley (here).

It seems some fund managers are saving their cash and waiting for the end of bear market (here).

US unemployment levels hit their record high (524 thousands) since Second World War (here).

Sources:
[http://www.marketwatch.com/news/story/Citi-talks-sell-brokerage-business/story.aspx?guid={7C719005-0F86-4991-91AD-C0767906F5E1}]
[http://www.marketwatch.com/news/story/For-some-stock-fund-managers/story.aspx?guid={A3199816-B1A9-4A7B-8816-9A3F0120B7E9}]
[http://gielda.onet.pl/0,1894402,wiadomosci.html (via Google Language Tools)]
[http://www.money.pl/gielda/wiadomosci/artykul/usa;najwiekszy;wzrost;bezrobocia;od;34;lat,191,0,413887.html (via Google Language Tools)]

20090108

The WIG Index dropped today:



Nevertheless, situation has not changed - we are still in careful uptrend. Not much can be told about market now - we are still in sleepy consolidation and no direction is certain. There is preferred scenario the index will rebounce from trendline, however we shall wait until tomorrow's close to see if this trendline holds.

Brian is bullish in his daily video, but waits for confirmation.

Seems the Madoff's scam will live longer then few weeks (here or here).

And some more talking over US economy stimulus package (here).

The negotiation over delivery of Russian natural gas through Ukraine to the EU failed (here).

Sources:
[http://www.miamiherald.com/business/story/814537.html]
[http://www.nytimes.com/2009/01/09/business/09madoff.html]
[http://www.marketwatch.com/news/story/Obama-warns-dire-consequences-without/story.aspx?guid={C1FD3A05-08DB-4B94-896D-E7338532C1D7}]
[http://gielda.onet.pl/0,1892909,wiadomosci.html (via Google Language Tools)]

20090107

Today's session was less impressive one (-1.44%):

We shouldn't make any forecasts (ever), but we should note well visible uptrend (higher high & higher low pattern). The overall situation has not changed and we are waiting for 29600 (or continuation of fail).

The natural gas transit through Ukraine from Russia has been completely cut off (here). This situation will have serious consequences.

Satyam Computers, one of the India's largest technology outsourcing company seems to be next Enron (here or here).

US job market took another hit with labor market report for December (here).

There also seem to be great volatility on crude oil (here). Ca.-14% drop in just few hours (chart thanks to ChartStation form Netdania):



Sources:
[http://gielda.onet.pl/0,1892080,wiadomosci.html (via Google Langage Tools)]
[http://www.michaelmoore.com/words/latestnews/index.php?id=13004]
[http://business.timesonline.co.uk/tol/business/industry_sectors/technology/article5464908.ece]
[http://www.marketwatch.com/news/story/Oil-tumbles-12-most-seven/story.aspx?guid={E6A90B85-A7A2-49E1-AA67-D5606D7173A2}]
[http://www.marketwatch.com/News/Story/adp-data-show-693000-private-sector/story.aspx?guid={11A2598F-2D9D-48D2-A934-144BA5E1BB9C}]

20090106

Another rally today, this time also the volume seems to confirm bullish sentiment:

The WIG Index has broken the level of 28600 - weekly high from 10th Dec 2008. That generates another buy signal on long-term. However, the real test will be the level of 29600 (we are quite near it).

Of course, it too early to call the bottom now and we won't know it was the bottom before we take the last market cycle high. But strong bullish sentiment is something we can use:

• daily uptrend (HH & HL pattern)


• broken trendline (with high volume)


• last weekly high (28600) taken


• CCI, RSI in uptrend

I'm personally waiting for strong and clear breakout of 29600.We don't know if bear market is over yet and if we can expect even more volatility. As per Elliott Wave Theory first wave is usually mostly retraced by second wave.

Therefore, I believe money management is very important and portfolio heat should be kept low now. Let's stay with small bets and restrictive stop-loss orders as for now.

Brett Steenbarger remains positive (here).

Sources:
[http://www.commodity-trading-solutions.com/portfolio-heat.html]

20090105

First session in 2009 showed us great rally with huge open gap:



We can hope this rally won't end soon and target level (ca.33400), however at first we should cross the important level of 29600, preferably also confirmed by high volume. Today's gain was huge, but we shall be still careful.

Warren Buffett seems to be optimistic in  long term (five years), but bearish in short term (five months) - article here.

Some more gloom & doom predictions for 2009 (here).

And Brian Shannon's video here.

There is an interesting article (here), where author come to conclusion that yearly stocks return are almost purely random. Let's see how it looks in last few decades for polish market:



Years' returns for DJIA, S&P500 and NASDAQ indexes are taken from 1stock1 site (here). Correlation coefficiency near zero mean the variables are almost independent; values close to 1 or -1 mean there is linear relationship (with positive or negative direction). Correlation is well explained in Wikipedia.

The polish market was very active in his first years (ten-fold gain in second year), therefore correlation values between US markets and WSE were low. Since 1998, we can note high correlation to US market.

The near zero correlation values for year and year+1 for those index show there is almost no correlation between preceding year's return and current year's return. Therefore, statistically speaking, we shall not expect any rebounce in 2009 only because 2008 year had great loss.

Sources:
[http://market-ticker.org/archives/689-Where-We-Are,-Where-Were-Heading-2009.html]
[http://www.marketwatch.com/news/story/Buffett-put-20-bln-work/story.aspx?guid={C55B33D2-BB7A-4636-B38F-5F1202B44E42}]
[http://www.marketwatch.com/news/story/A-review-stock-market-2008/story.aspx?guid={C804E9C8-2C7C-4E33-84E6-9A056024E3AE}]
[http://www.1stock1.com/1stock1_142.htm]

20090103 - EURPLN, CHFPLN

Welcome in first entry in 2009.

The market currency has shown amazing volatility in 2008 and it's hard to make any forecasts for 2009. EURPLN seems to lost its momentum in last week (I don't think there were many trades either):



CHFPLN also hovers just above 2.73:



There are few worth-reading articles: nice 2008 summarization from MarketWatch (here), quick look into corporations with large amount of cash and their performance (here), Brett Steenbarger's article about rising appetite for risk among investors (here).

Slovakia entered euro 1st Jan 2009 (here).

Also, there is interesting theory called January Barometer, stating that the performance of the S&P 500 in January sets the stock market’s direction for the year (here). There you can find academic paper, which seems to confirm this phenomenon:

(...) 11-month holding-period excess returns following positive Januarys are much more likely to be positive than are 11-month holding-period excess returns following negative Januarys. Indeed, following the 41 positive Januarys, there are only five years in which the 11-month holding-period excess return is negative. (...)

Sources:
[http://www.marketwatch.com/NewsCommentary/SpecialReports/YearEnd]
[http://seekingalpha.com/article/112828-cash-is-not-yet-king-when-it-comes-to-market-performance]
[http://www.investopedia.com/terms/j/januarybarometer.asp]
[http://seekingalpha.com/article/112952-hints-of-risk-appetite-returning-to-the-stock-market]
[http://www.nytimes.com/2009/01/03/business/03markets.html]
[http://www.marketwatch.com/news/story/Slovakia-becomes-16th-nation-adopt/story.aspx?guid={191E5EB8-6C24-4706-AD91-DE5415E806CE}]
[http://papers.ssrn.com/sol3/papers.cfm?abstract_id=663563]