Ford and Citigroup

Shares of Ford fell nearly 10% from a relatively mild offering of shares, compared to the amount of shares Citigroup is offering. I am waiting to hear details on when the sale of Citigroup shares will begin, as the full details of the sale have not yet been announced. I am considering taking a short position in Citigroup in the coming weeks.


Onlooker said...

Well, even with the high bullishness it seems that we may be kicking off the next leg up of this market with the very high up vol:down vol ratio so far. It's early but this kind of strong upside volume is usually indicative of strength that will allow us to hold new support levels and head further up.

But given the fact that we didn't get much, if any, retracement, this leg should be much more limited in gains.

I remain long with about 2/3 cash. Picked up a bit of gold stocks recently as the dollar looks like it's going to do a significant retracement here. That should also allow stocks to rise without the dollar's pressure.

Those who continue to try to pick the top and remain short here are going to keep being bled to death. The strength in this market's internals, even with the "overbought" conditions (which are just a sign of strength at this point) should warn off shorts.

Strange times.

Onlooker said...

HUGE call buying showing in ISEE this morning (equity only) may just be another "kick off" sign rather than a contrarian signal this morning. Also an odd divergence from the very low All Indices & ETF Only number.

It seems that we may have to see the $CPC 30 MA and $NYAD 30 MA come down a lot further before we get a significant top.

PJ said...

Something very odd has happened with the unemployment data ... the seasonal adjustment factors are published months ahead of time and I record them for use in my model of employment ... The last two weeks the government has altered its seasonal adjustment factor to reduce the headline number. With the previously published SA factors, it would have been 452,000 SA initial claims both weeks -- instead we got 445,000 and 439,000, an improving trend.

I have never before seen any such alteration in SA factors for initial claims. Was there some change to the SA process introduced two weeks ago that I missed, or are we in a coordinated market pumping operation?

PJ said...

Just looked through and compared all the weekly SA factors. They've retroactively changed the SA factors for January to make those weeks look worse than they were reported, and have adjusted the SA factors for the last two weeks and upcoming weeks to give better looking numbers. SA factors have to average to zero over 12 months, so they have to steal from one month to improve another.

I'd love to see the official explanation for this.

The effect is to increase January headline claims by ~10-15k per week and to reduce late March/early April headline claims by a similar amount.