Venda do Novo Banco pode representar 8% do M&A na banca europeia este ano

[Pata-Hari]

Deixa-me sublinhar por repetição dois nicos, já que a interpretação que temos lido tem sido inversa...

Here's a little bit of research I did last night: Right now the 50-day Historical Volatility on the SPX is 21.3. The VIX (which measures the implied volatility on OEX options) is at 37.02. That means the VIX is 1.74 times as high as the Historical Volatility. How often does that happen? Less than 10% of the time over the past 5 years. What does that mean? It means that the market has been relatively calm compared to the expectations of investors. It means there is a lot of anxiety and not much movement.

Meanwhile the 20-dma of the Put/Call Ratio has turned down from a level above 0.94. The ONLY time in recent memory that the Put/Call Ratio has been higher than that was between 10/4/02 and 10/17/02.

All the indicators we look at suggest that investor pessimism is at an extremely high level.

[Pata-Hari]

pena não termos as imagens.... é didáctico e interessante hoje. Aliás, aprecio a modéstia com que é escrito. Gostei.

[Eagle Eye]

THURSDAY a.m.
February 27, 2003



The Other Head-and Shoulders
by David Nichols

It's just so easy these days to get caught up in all the negativity. How could you not? News flow is terrible, and the reaction in stock prices is invariably poor. This has been a psychologically debilitating market.

So this morning I want to step back and actually discuss the unthinkable: What if the markets actually start to do well here? What could that look like?

Please don't scoff. I realize it's very unfashionable to even talk about a bullish case. And please don't get me wrong. I'm not hopping on the bullish bandwagon. I'm just saying I'm not opposed to doing that, if the situation warrants it. As always, the goal is to stay flexible and let the market guide us.

Right now the markets feel hopeless. There are a gazillion reasons why the markets should stay down, or go lower, but only a few reasons why they should go up. (Adam makes a great point about pervasive negativity in the dashboard section below.)

To my way of thinking, this is a time when we have to consider contrary outcomes, and stay aware of all the possibilities. I haven't heard anybody really talk about bullish possibilities, except of course those discredited Wall Street strategists that have never said anything bearish in the last three years.

One of the main pillars of the bearish case is the widely-recognized long-term bearish head-and-shoulders pattern, which is often cited as a particularly ominous bearish portent. I've seen projections of this pattern that takes the S&P 500 all the way down to 350.

Fist, the background: The head-and-shoulders pattern has the market tracing out 3 distinct moves. The middle one is the tallest (the head), and the two surrounding it are the shoulders. The pattern holds that when the base "neckline" is broken, the projection for the move is the about the same distance as the height of the head.

Here's what this long-term head-and-shoulders looks like:



I must admit that I'm not a big fan of the head-and-shoulders pattern, particularly when it is applied to long-term price structures. Looking back myself, I've never seen an instance where the market traced out a multi-year head-and-shoulders pattern. Of course we could be making history here. But this pattern was originally characterized to describe short-term market actions lasting days and weeks.

If I'm wrong on this, and there is a multi-year head-and-shoulders that you can show me, then please, send it my way. Maybe I just haven't looked hard enough.

Now, as long as we're discussing this pattern in relation to a longer time-frame, then we've got to at least acknowledge the possibility that the markets are building an inverse head-and-shoulders pattern right now. This would be highly bullish, if this were indeed playing out.

Interestingly, the neckline of this possible inverse pattern is the same as the neckline on the bearish one. It's right at SPX 950 or so.



So if the unthinkable happens, and the markets start to inexplicably rally, then you don't necessarily want to cling too tightly to well-entrenched bearish notions. That's all I'm saying. Again, please don't read this the wrong way. I'm not suddenly going to start citing projections from Abby Joseph Cohen and Joe Battapaglia. I only want us to acknowledge some other possibilities besides a horrible wipeout for the markets.

But if another wipeout is coming, we'll take advantage of that situation. A panicky sell-off from here should actually provide another really good buying opportunity, with bungee cord gains of 15% or 20% in a short amount of time. In a way, that is the easiest thing for the market to do right now -- and the market never, ever likes to make it easy.

It almost feels like the trickiest thing would be for the markets to start to inexplicably rally -- slowly but surely -- and move all the way up to trigger this inverse head-and-shoulders pattern. I haven't seen anybody else even acknowledge the possibility, which definitely makes it worth pausing to consider.

Sentiment Dashboard
by Adam Oliensis



SENTIMENT TANK: The tank filled by 3% to 82% full of negative sentiment on Thursday. It's been fluctuating within a narrowing range for a couple of weeks now.

Here's a little bit of research I did last night: Right now the 50-day Historical Volatility on the SPX is 21.3. The VIX (which measures the implied volatility on OEX options) is at 37.02. That means the VIX is 1.74 times as high as the Historical Volatility. How often does that happen? Less than 10% of the time over the past 5 years. What does that mean? It means that the market has been relatively calm compared to the expectations of investors. It means there is a lot of anxiety and not much movement.

Meanwhile the 20-dma of the Put/Call Ratio has turned down from a level above 0.94. The ONLY time in recent memory that the Put/Call Ratio has been higher than that was between 10/4/02 and 10/17/02.

All the indicators we look at suggest that investor pessimism is at an extremely high level.

SHORT-TERM: The short-term gauge was solidly neutral most of the day on the SPX.

MID-TERM: The mid-term gauge continues to creep up a point at a time in its weakly developing advance phase. On Wednesday it moved up to 10%. However our CDI regressed to 0.

LONG-TERM: The long-term gauge remained unchanged at 51% in its decline phase. The CDI progressed bearishly to 3 on a scale of 0-7.

Within the recent consolidation on the tank the internals have been sloshing around from bullish to bearish inclinations and back again.

On absolute bases there is an extremely high level of negativity in the market. The question is, Is it enough negativity considering how negative are the geopolitical and economic situations? There's still room for another whoosh down. But there continues to be more room on our sentiment measures for upside in the market. (But that will likely take some good news out of the Middle East.)