TCM Notes : 5/27/09

• Tuesday's session put the market back in a confirmed uptrend according to IBD. Broad strength indicated institutional buying, but it was noted by Execution LLC that order flows are "slooooow" on the equities desk. He said this suggests that program buying by institutions is driving the rally, and that smaller traders/retail are not participating. I bought some more UYG at 3.76 on it's trend line after hours Friday (so I'm participating!.) 7% pop today on that to end above the 3.98 (23.6%) Fibonacci line. Market hasn't rolled over yet with the moving averages/retracements still providing support, so I'll continue to trade with the trend.
• Glenn Rudebusch at the San Francisco Fed cited the Taylor Rule and said the fed funds rate could stay near 0% for years. Apparently this rule implies that the rate should be -5% by year end. This stuff is above my pay grade, but here it is if interested. Lack of accounting for real time data is the major flaw with this rule. As is the problem with most backward looking policy decisions. http://en.wikipedia.org/wiki/Taylor_rule
• Getting back into the swing of things again.....getting caught up on reading was a nightmare but it's done now.
• DBA has settled above it's 200dma for several sessions now as has MOO. And MOO continues on with the 50dma getting ready to cross up through the 200dma. This is known as a Golden Cross. And yes, it's bullish. Most professionals are using these two more now instead of the underlying futures and single company exposure to agriculture. Of course this type of lazy investing does provide opportunities for those that can stock pick. I'm somewhere in between at the moment.