Tuesday’s Trading
The Panic is Over!
That’s the good news. Now the bad news: the Depression has begun. The explosion on Capital Hill today was the political version of Dick Fuld’s suicide bombing of Wall Street a couple weeks ago. Confidence in both our financial system and political system has been lost. And in case you are wondering, none of this is “healthy” - this is a total disaster. Some traders are looking for a giant rally after today’s panic selling. Not me. I’m sticking a fork in America.
McCain Knows He’s Toast
John McCain spoke briefly after the market closed. He sounded like he was delivering a eulogy at a funeral - and he was - his own. I wonder how many decades the Republican Party, a.k.a. The Depression Party, will be consigned to opposition status in Washington?
It’s Time for Congress to Abdicate
It’s pretty obvious that the USA’s experiment with democracy has been a failure. As Congress’s last act before abdicating, they should hire a management team from Singapore to take over. It is no longer acceptable for the world’s largest economy to be managed by rubes.
America is Stupid
Stop and think about what just happened. Ben Bernanke is an acclaimed scholar who has distinguished himself by doing groundbreaking work on the causes of the Great Depression. And here in this new Depression, the American people have told him to pound sand!
Hank Paulson is no scholar, but he is a top practitioner, and is the perfect compliment for the egghead scholar. Even if you don’t like Ben and Hank, you have to admit that you couldn’t find a team with better resumes for this job. But now they are pounding sand. Well, I’m sure that the masses will come up with a better solution…
Stomach Turning
Watching my country commit suicide has interfered with my concentration. But now that I am cheering the rubes onto their new Depression, I am back to enjoying life and should be posting more comments.
Watch the comments for updates throughout the day.
September 29th, 2008 at 11:50 pm
Matt - that’s the sound of two hands clapping. Here, here, Encore.
As long btw as you’re applauding the bald twins let’s add they both perform well under extraordinary pressures that perhaps only a combat veteran would know worse of. But that veteran wouldn’t be responsible for the well-being of millions of his fellow citizens nor be called on to tolerate being treated like a sub-human cretin in order to do his job.
This is public service at its’ finest.
It is a singular tribute that literally within less than an hour that Paulson was issuing we shall continue to strive press conference and headed back to the White House and up the Hill to plot the next moves.
The guy’s stamina, resilience and discipline are amazing.
September 30th, 2008 at 12:11 am
Matt,
it’s time to go long again. Nikkei and Hang Seng in Asia recovering. The losses are not too big and the American futures are up. Biggest losers of yesterday’s bailout rejection:
1.) Pres. Bush
Nobody is listening to him any more. Lame duck.
2.) Pelosi
She is completely unprofessional.
3.) McCain
Interrupted his campaign last week. Obviously nobody listened to him either. Lame duck already even before becoming something like a duck.
Don’t let yourself down, Matt. Life goes on. See the opportunities. “Going long” is the motto of Tuesday’s trading.
September 30th, 2008 at 12:15 am
Dblwyo,
Yes, I was surprised to see Paulson talking to reporters Monday evening, and then going back to work. I would have given up and been in a bar drinking.
Matt
September 30th, 2008 at 12:18 am
Dressguard,
I’m long in the futures, though I might get stopped out while I’m sleeping.
Matt
September 30th, 2008 at 12:39 am
Guys,
are you going to be continuing to short any and all rallies here for a while? Futures are way up right now, but it is expected. I think that there was panic during the final few minutes of trading today and it took a while for the ticker to correctly calculate the exact total of the bloodbath today. I wonder what tomorrow brings??
September 30th, 2008 at 1:27 am
Paulson’s big mistake was his original plan that he submitted to Congress. He asked for a LOT of power and no oversight. Perhaps it was a negotiating strategy (ask for more than you want), but now he has lost some credibility. Coming from Goldman Sachs, he already had that to overcome in the trust department, and blew it in my opinion. I’ll refrain from judging Paulson (positively or negaively) until I see how he uses the power that he will get. Maybe I have been judging paulson harshly, but I’m not forgetting that he was a huge part of the problem as head of GS.
Bernanke has been put in a difficult position. Looking back, I really can’t fault the guy. Plus he has to take public sh*t from @ssholes like Cramer that ignore their own big mistakes (but admit their little ones) and trumpet their own successes. Spotting a problem is SO much easier than coming up with a solution.
September 30th, 2008 at 2:03 am
I am looking for a short lived pop to SPY 116 to 118 then back down lower. with the futures up now and a gap up tomorrow, if this sticks, this is usually not how a bottom works. I should have stuck with my first take on that false bottom the government put in last thursday. the stochastics on the weekly is still too high. no near term bottom has ever been made in this bear market under these conditions. After further review I also take back my capitulation comment I posted earlier. It still was the second worse distributuion day in ten years though.
September 30th, 2008 at 6:05 am
Sorry to disagree, but Paulson is “working” for GS and not to save the country. There are three ways to motivate - fear, sex, and money. Paulson needs to help his friends of Hank club and if left alone, the markets will recover and a great bull market will begin. He is driven by money as everyone else on the Street. I know, I was one of those masters of the universe for many years.
Many years ago and long forgotten by just about everyone, Paul Volker did what many thought was a desperate attempt by an out of control lunatic to stop interest rates from truly going “banana republic”. Bad, bad recession, but look what followed.
Consumers incorrectly became drunk on MEW and the choking off of credit is the reality of a borrower who has no capacity to take on more debt.
Everyone is talking about the equity losses. Huge profits were made in the long end of the govie market, consumers enjoyed a huge uptick to purchasing power with the decline in oil prices and the jump in the USD. It is not so one sided and for once, everyone needs to understand buying stocks is not an video game with the buyer always a winner.
The bailout bill should carry a huge stick to those who need and use it. Over the past several days there have been some huge rescues and major amounts of equity have been invested in the deals. The free market works and it only needs a little bit of govie lubricant. Not the huge amount of grease Hank and Ben are proposing.
Anyone want to take a bet that Ben ends up at Goldie with a huge pay package? He is being motivated by one of the three things I mentioned at the start of this sermon. Thx for reading it.
September 30th, 2008 at 7:19 am
Boat52;
Welcome. Nice to have your insights.
Food is a motivater for me.
September 30th, 2008 at 8:05 am
BBT - dropped $6 close to the closing bell yesterday. THAT’S why I’m out until the “deal is done”, if ever.
On the other hand, had I been watching closely, I would have jumped in at EOD.
September 30th, 2008 at 8:16 am
Please watch this video if you think John McCain is toast. http://www.rightsidenews.com/200809302090/editorial/burning-down-the-house-what-caused-our-economic-crisis.html
September 30th, 2008 at 8:30 am
Jim;
Revealing video. Like I always say, things aren’t always what they seem to be.
September 30th, 2008 at 8:31 am
Jim:
We’ve been pretty suspicious of the entire process for a while. Hopefully the McCain campaign does a good job of marketing that, I’m surprised that they haven’t been pointing fingers already.
September 30th, 2008 at 9:00 am
This video is from the McCain campaign. Wake up, Awake! LOL
September 30th, 2008 at 9:03 am
lol, whoops, I don’t think that was made clear in the vid, or maybe I missed it
was watching another video that is a carbon copy of that last night on youtube, some kid ostensibly made it.
Kinda sick of barney frank and pelosi tearing the republicans up all over the place when its pretty clear whose policies are to blame for this mess…
September 30th, 2008 at 9:09 am
This is called guerrilla marketing.
September 30th, 2008 at 9:30 am
Here we go
September 30th, 2008 at 9:43 am
damn NCC haha
September 30th, 2008 at 10:00 am
I got stopped out of my long position in the futures while I was sleeping last night at 1144. I got in at 1133, so I caught 11 points. At the open, I bought some SDS and went short in the futures. I have stops set just above opening prices.
September 30th, 2008 at 10:07 am
I just got stopped out of my short futures position, but not my SDS yet.
September 30th, 2008 at 10:09 am
We’ll have a 777 point up day today (lol).
Man, I knew I should have gotten BBT last night. But my rule says no.
September 30th, 2008 at 10:10 am
SSO 15 minute MACD went positive. Will see if it clears it okay.
September 30th, 2008 at 10:13 am
K;
You should be doing okay with NCC. Good trade.
September 30th, 2008 at 10:14 am
I got stopped out of my SDS and it looks like the rally will stick for a while. The NYSE TICK is in a very strong uptrend, volume is light, the market is still oversold, and it’s the last day of the month. So, the big funds are having their way with the tape.
September 30th, 2008 at 10:15 am
I flipped over to the long side and am long in the futures at 1144.
September 30th, 2008 at 10:15 am
The way I figure it, just about all the bad news has been absorbed, anything else will be noise or perceived as good news. That doesn’t mean we can’t tank more though, but the bias should be toward the upside for a while.
September 30th, 2008 at 10:17 am
Only 500 more points on the DOW will give us a 777 point gain.
September 30th, 2008 at 10:17 am
Ya gotta love this stuff.
September 30th, 2008 at 10:20 am
The futures are a few points ahead of the SPX today, so my long position at 1144 is 4 points into the money.
September 30th, 2008 at 10:20 am
There will be a lot of folks bailing out on the way up.
September 30th, 2008 at 10:20 am
K
nice play on NCC overnight
in SKF here
September 30th, 2008 at 10:26 am
Will ICE make the $10 move up today? We’re at $6 and counting.
September 30th, 2008 at 10:27 am
soy estupido sold at 1.80
in hopes i;d get back lower. never did. quotes were lagging for me. oh well I still can;t control the urge to trade after 1PM
getting there
September 30th, 2008 at 10:30 am
I got stopped out of my long position with a 2 point gain. I am keeping stops tight since I don’t trust this market any farther than I can throw a cat. Two points on a futures trade is good money.
September 30th, 2008 at 10:30 am
George
how would i go about tradin ICE
have accounts @ td amer & thinkor swim
September 30th, 2008 at 10:31 am
ICE lol i think you can buy
September 30th, 2008 at 10:34 am
damn george. when will the ice melt? i want some melted ice to freeze again
September 30th, 2008 at 10:40 am
Average guy;
My broker has it available for me. I just put the ICE symbol in the trade screen. I would assume it is readily available.
September 30th, 2008 at 10:41 am
ICE trades on the NYSE. So, when you buy or sell ICE you don’t need access to ICE’s exchange. You trade it just like any other stock.
September 30th, 2008 at 10:42 am
Ameritrade and scottrade have it too. (ICE that is)
Good call George
I won;t trade till later again.
so tempting but yes i must follow MY rules
September 30th, 2008 at 10:44 am
Just remember that ICE is a creature with a bipolar personality. But when it moves - wow.
September 30th, 2008 at 10:47 am
SDS nearing 15 minute 36 MA, when it hits, expect something to happen.
September 30th, 2008 at 10:53 am
Be careful with ICE at these levels. Follow indicators for exits.
September 30th, 2008 at 10:57 am
Matt,
Bernanke is a self-proclaimed scholar of the Depression, but his conclusions were wrong. He concluded the Fed did not come up with enough creative ways to inject new money and credit. Hence the Fed’s recent unprecedented maneuvers. But the reason they were in the mess then and we are in this mess now is because of an over-saturation of money and credit. I have not seen your analysis on this, but I believe this crisis is an unnatural phenomenon that had nothing to do with the free market. Money has a supply and demand like everything else, and when you hold interest rates below market equilibrium (1% following the popping of the NASDAQ bubble), you create excess. In this case the excess credit poured into homes. That coupled with Fannie and Freddie and various Community Redevelopment Acts, Banks, etc. supporting loans for people who otherwise would not qualify created a massive, unsustainable distortion in the markets.
Do you or anyone here agree with this assessment? I believe it to be critical because if you do, how can you reason that a problem caused by inflation can be cured with more inflation? Also, what about Paulson and Bernanke’s comments in months past? Bernanke actually said the sub-prime market was “well anchored”. And Paulson was parading around on television saying the markets are strong and flexible. Now these people are going to save us?
September 30th, 2008 at 11:10 am
Freewheeler, I think something needs to be done but no bailouts. Not for wall street and not for the people who borrowed excessively during the credit binge and now are defaulting. Maybe guarantee bank deposits and money markets and let the investors and bondholders understand that investing can make OR LOSE money.
September 30th, 2008 at 11:12 am
thanks 4 the help
ICE is an exchange ?
September 30th, 2008 at 11:15 am
So is everyone staying out of the market right now?
September 30th, 2008 at 11:16 am
freewheeler
i agree . i also think inflation is the
only tool left to control the “Mob”
September 30th, 2008 at 11:16 am
I will. except my gold position which is small and today going down thanks to the rally. Got me a lunch date so screw making money hehe
September 30th, 2008 at 11:16 am
be back later
September 30th, 2008 at 11:17 am
The DOW traced exactly 38% of the move from yesterdays high to it’s low at 10,676. The 50% fib is 10,767.
But there is also a tendline going down on the 5 minute that looks to be lining up with the 38% fib at 10,676. That would appear to be a key point as resistance for at least today.
September 30th, 2008 at 11:18 am
Oh, and BTW, I don’t think much of Bernanke. He is smart academically; you can see it from the way he talks. But he built a life and a career on blaming the FED for the great depression. Yes, some of the policies during that period worsed the problems. But the depression was caused by silly lending in the 20s (i.e. FED policy of the 20s which I think was an attempt to help Britain). Plowing grain and liquidating blindly just made everything worse.
Some balance of punishment and bailout via inflation is in order. Handouts are not. We have some serious issues raising their ugly heads like retirement of the boomers, SS, medicare, peak oil, global warming, inflation if China finally decides to give a living wage to its workers, etc. The federal governments fiscal house is in disarray and we need to have something left to fight all of them with.
Too much money printing and we will have a currency crisis. And we definitely DO NOT want that.
My 2c…..
September 30th, 2008 at 11:24 am
I went by a gas station today and saw a line. Hot Dang, GAS. They were having a sale on Cokes & stuff, going out of business.
All I want is some gasoline.
September 30th, 2008 at 11:27 am
LOL George. damn them.
I’m back on schedule for trading after 1pm.
September 30th, 2008 at 11:28 am
That’s not all I want, I’d like to have my charts sync up. They’re out of whack again.
September 30th, 2008 at 11:37 am
George, et.al. - SPX bumping into resistence at the G-line of 36MA on both 5 and 15 min. G-line is my new name for the George-derived indicator btw.
For all the folks condemning Uncle Ben you understand that the GD was in fact causes by the Fed cutting money supply in 1/2, tax increases and a lack of fiscal stimulus ? This is rather well-documented by some sixty years of empirical and theoretical studies.
What we don’t understand well is how booms and busts propagate because we don’t have a good understanding of dynamics.
But far be it from me to disrupt your thought processes with actual facts. Trade as you like and if it works sobeit !
September 30th, 2008 at 11:39 am
Thanks Dblwyo…
September 30th, 2008 at 11:46 am
Dblwyo, nice catch!
September 30th, 2008 at 11:48 am
ICE - also note those little dips, depending upon market conditions, turn in to $1-2-3 scalps.
September 30th, 2008 at 11:53 am
See, this is screwed up. SSO has a way to go to get to the overhead 36MA resistance, while SDS is trying to break down below its 36MA resistance. Skewed charts = screwed trader.
September 30th, 2008 at 11:55 am
Thank you My Master.
s/Grasshopper
Political Pathology of a Failure: http://tinyurl.com/539ajb
September 30th, 2008 at 11:55 am
I’m diggin DIG today, too.
September 30th, 2008 at 12:06 pm
i should have DUG DIG instead of selling at 57 hehe
September 30th, 2008 at 12:14 pm
Crimson Ghost,
I have deleted your last comment. Exactly what part of “stop pirating content from other sites” don’t you understand?
September 30th, 2008 at 12:17 pm
I have had to delete three comments in the last 24 hours. Just because you can copy-and-paste something from another site to here doesn’t mean that you should. In fact, it is against copyright law and punishable by very steep fines.
This is distracting me from my trading. If it continues I will shut down comments.
September 30th, 2008 at 12:21 pm
does the dollar’s strength relate to the massive swap transactions taking place between the central banks? I have no idea how these things are settled - anyone have an idea?
September 30th, 2008 at 12:32 pm
Yerk - mainly ignorant myself but mechanically it’s largely a movement of existing credits on the books of the BIS.
Perhaps more importantly the $ strength is more a reflection of the flight to safety. Ironic in light of the comments here and elsewhere.
Fascinating socio-pathology if you’ll pardon the observation that people who make their livings in markets take their existence for granted while not understanding their ecological roots. Ecological in the sense of institutional foundations.
September 30th, 2008 at 12:33 pm
Matt;
Looks as if your month-end analysis is playing out as predicted.
September 30th, 2008 at 12:38 pm
This move on SDS is still playing off the 15 minute 36 MA. It over shot it 3/4 of a candle, then is attempting a move back up.
Simultaneously, as Dblwyo pointed out, the 5 minute is bumping up against the 36MA resistance. In this case, the 1 minute is the arbiter.
September 30th, 2008 at 12:40 pm
why are bank stocks trading flat now? that’s why i got out of NCC hmm
September 30th, 2008 at 12:41 pm
Always drop down to a lower time frame when support or resistance is hit. That will tell immediate direction.
Go to a higher time frame when finding the overall direction or verification of a lower time frame move.
That’s what I do. After a while, getting used to the time frame relationships, it will literally tell you when to get into and out of trades.
September 30th, 2008 at 12:42 pm
“Crimson Ghost, … Exactly what part of “stop pirating content from other sites” don’t you understand?”
Every part of it. LOL
Btw, I am 100% in cash right now. Don’t see any good opportunities right now. Made some bucks earlier this day in European trading though. But it was pure luck. Actually was one second late with my original trading plan. Obviously I hadn’t enough courage to pull the trigger. Missed a 30% gain. Now watching on the sidelines how you are making some dough.
September 30th, 2008 at 12:44 pm
dressguard i missed a nice gain too NCC. oh well
September 30th, 2008 at 12:47 pm
@K: Can happen.
September 30th, 2008 at 12:48 pm
Crismon Ghost. you can quote a paragraph and post a link. ok? better explanation?
September 30th, 2008 at 12:49 pm
The cycles being created are the ones being scalped. I just make sure a move is not false.
Another tip. If watching say, the 1 minute stochastic, it will bottom out, check the 5 minute to see if that stochastic has bottomed out. If so, there is a high probability of a move up. Wait until a price bar clears the higher time frame
This differs with my overall method in that it doesn’t require the stochastic to bottom out. That method allows you to get into a trade when a trend has already begun instead of waiting until it plays out.
Look at a 1 and 5 minute chart and you’ll see them all the time. When I was trading only 1 or 2 stocks, I would keep a 1 and 5 minute screen side-by-side on one monitor and just trade that setup.
Good stuff.
September 30th, 2008 at 12:50 pm
dblwyo,
Do you not find it interesting that the Fed came into existence in 1913, we had the roaring 20’s, and then a collapse? The Fed pumped up a bubble with artificially low interest rates and it went into stocks. Then when it crashed, they imposed measures to keep wages and other prices up, when the market was demanding them to fall. The 60 years of empirical and theoretical studies that you claim to stand upon must have been Keynesian in nature. No fiscal stimulus? What about the causes of the Depression? How about the New Deal? I agree taxes should be lowered, especially in tough economic times. As far as boom and bust theories go, the Austrians have had that figured out for some time now, predating the GD. That is why they were able to predict this collapse. When you distort markets, they will correct. The damage was done during the housing boom, the correction is merely the messenger of reality.
And Gigi, all of your problems you listed have been either caused or exacerbated by government policy and intervention. And I disagree with your belief that what we need is more inflation. For a blog that is suppose to have a libertarian bent, I can’t understand why there is no faith in free markets (or worse, faith in those with the power to coerce), and how so many can be ok with stealing money from others, either through taxation or inflation. The government caused this. But instead of rolling back their influence, they will do what all governments do in times of crisis: grow.
September 30th, 2008 at 12:51 pm
I hope I explained that okay…. busy right now - lol.
September 30th, 2008 at 12:54 pm
The only problem with using the “bottomed-out stochastic” method, is that moves will be missed when a higher time frame is already positive and you don’t have to wait for confirmation, like in a trend.
But they come along often enough in day to make a living.
September 30th, 2008 at 12:55 pm
Freewheeler, I am not in favor of inflation, just offering it as a compromise.
Dblwyo, I am actually trading this bailout passes
But very small. No convictions here.
September 30th, 2008 at 12:58 pm
K;
How did you miss a gain in NCC?
September 30th, 2008 at 12:59 pm
i forgot is not 1 yet. should see some nice moves coming
TRIN is 0.56 in this past hour. going higher. sucks. lol
September 30th, 2008 at 1:00 pm
well george i put a limit at 2.25 in premarket it opened up high but i guess there were too many shares wanting to go and i wasn’t top priority.
September 30th, 2008 at 1:02 pm
If ICE gives me that $10 today, Expect to see a “YIPEE”. I’m getting my wife a wide-screen Samsung TV for her birthday.
Actually, it already has given me ten bucks, but I just want to see it go that high to give me a high.
September 30th, 2008 at 1:02 pm
My Master (George): 5Min now trading in 36/72MA consolidation range.
Failing rally ? Suggest so w/o catalyst.
Speaking of conviction try ROC again - seems to tell you whether a move is serious or not.
Have you considered having the local U build you a war room ala War Games ? Get them to treat it as a DSS research project.
September 30th, 2008 at 1:03 pm
Sellers are back from lunch.
September 30th, 2008 at 1:07 pm
Dblwyo… how do you play the ROC? if it’s above 0 and gaining momentum is a good move?
September 30th, 2008 at 1:13 pm
Dblwyo;
I don’t know what it is going to do. I’m in the SSO via the 15 minute chart (my hero) all AM. Then swing it and SDS 1-5 minute. I won’t get out of SSO 15 until MACD goes to zero. Meanwhile, I’m doing 1 minute swings which are very nice today. And, if the SSO 15 minute does turn over, doesn’t matter because that means I’m already in SDS. The two don’t offset each other because I am always swinging. It adds up at EOD.
I keep it going for sure. Hmmm, I hadn’t thought about it but I really am playing multiple time frames.
September 30th, 2008 at 1:15 pm
Dblwyo;
Yes, ROC is nice. I haven’t traded it yet, but I have it on my Mac ‘puter chart.
September 30th, 2008 at 1:15 pm
I tell ya… my broker luvs me!
September 30th, 2008 at 1:16 pm
“Boy, why don’t you just put that money in and leave it?”
Well, I’ll give you 777 reasons I don’t do that.
September 30th, 2008 at 1:20 pm
C’mon, ICE!
Just $1.50 more.
September 30th, 2008 at 1:21 pm
the brokers said that? haha
September 30th, 2008 at 1:22 pm
Only 470 more points to get 777 DOW.
I wanna trade BBT so BADLY.
September 30th, 2008 at 1:24 pm
Finally, SSO almost bumping up against its 36MA resistance.
September 30th, 2008 at 1:24 pm
come on ICE listen to george. these charts today look like CRAP so i’m staying put.
September 30th, 2008 at 1:28 pm
So, I have 3 choices with 15 minute SSO. Wait until 15 minute MACD takes me out, sell at resistance, or drop down and let the 5 minte take me out.
I’ll let it ride since I will get a profit if MACD takes me out, and there is a chance it can move higher.
September 30th, 2008 at 1:30 pm
Poop, ICE s/b going through the roof. I tell ya, it’s a mental case.
September 30th, 2008 at 1:31 pm
O man, what a day.
September 30th, 2008 at 1:33 pm
SSO 15 minute almost has clearence, Clarence.
Get ready for SDS to talk back.
September 30th, 2008 at 1:35 pm
SDS has big support ~71 area.
September 30th, 2008 at 1:36 pm
Ha! That 71 area is also the SDS 30 minute 36MA support.
September 30th, 2008 at 1:36 pm
K - very carefully. I’m still learning it and it needs to be watched w/MACD, SlowSto, whatever else you use. Tricked me yesterday into a slight loosing trade on SDS as it’s quick and early. That said I treat it as an indicator of flows and momentum - rather like cash flow or Chaiken’s but more sensitive.
George - good lord, I bet he does ! 1 min swing trading. How many trades do you do in a day anyway ? Sounds like 20-30 ? And do you always use a “straddle” (offsetting pair trade) like that ? Interesting.
September 30th, 2008 at 1:39 pm
Ironically, that is not the resistance area for SSO - it still has a long way to go on the 30 minute to hit 36MA.
I think the secret to skewed charts is just to go by the one that actually has the event next. So, I will judge it by the SDS 36MA.
Sounds like a plan.
September 30th, 2008 at 1:39 pm
Nice FASB rally going here. I got in just before it began using George Method. One day, I will be a scalping ninja just like George. Hey George, if we were younger, we could start a hedge fund and tear it up!
September 30th, 2008 at 1:40 pm
Expect a 1 minute cycle here.
September 30th, 2008 at 1:41 pm
Matt;
hehe. I REALLY wish I had started this in my 20s. I wouldn’t be here right now - LOL.
September 30th, 2008 at 1:43 pm
ROC test coming up. It just tipped over on 5 and 15 min. Would suggest SSO goes with it with a lag.
September 30th, 2008 at 1:45 pm
Dblwyo,
I know a guy who does over a thousand scalps a day. He’s a mathematical genius, and aced the math part of the SAT. Got a perfect score. That’s what you’re up against!
Matt
September 30th, 2008 at 1:47 pm
Every time frame will cycle. Key is recognizing that and take advantage like SDS right now.
The 1 minute seems miniscule, but it is what makes the trends and upper time frames move.
Who knows, this could be the beginning of a major reversal. If not, get some coins and get out. If it is, stay in a enjoy the ride.
Thing is, We don’t know and we don’t care. We just ride the waves.
September 30th, 2008 at 1:48 pm
i got 660
close enough.
September 30th, 2008 at 1:48 pm
Freewheeler,
I completely agree that excessive credit was the culprit, and until house prices fall below their trend lines (as comapred to GDP, income levels, and rental prices), we are in trouble.
There are two ways to bring house prices in line: let prices drop, or let incomes and GDP rise (inflation). The most fair method is to let prices drop, but then you can have panics and other problems. Inflation is a cushion in the system. Unfortunately, inflation is a hidden transfer of buying power from the poor to the rich, since the poor can’t afford to invest in assets (houses, stocks) that appreciate, while still having to pay more for goods.
Anything we do to prop prices will just pushes the problem further out, and moves the losses from the banks and homeowners to the general population (inflation).
September 30th, 2008 at 1:49 pm
In case you missed the news, there is talk of changing a FASB accounting rule dealing with “marking to market.” That’s what triggered this move up.
September 30th, 2008 at 1:49 pm
anybody like a long term gamble? HTOG in 31k at 0.0042 LOL
September 30th, 2008 at 1:50 pm
ICE ain’t what it used to be. Back in the day, it would be up $18 by now.
It’s just not the chip off the ol’ block it used to be. I need to find another bronco to ride.
September 30th, 2008 at 1:52 pm
Bless it’s heart, ICE got offended and moved up within .75 of my target.
September 30th, 2008 at 1:53 pm
Anybosy notice that XLV (healthcare) and XRT(retail) are not participating in this rally at all? They are both negative. XLE (energy) is the sector leader, followed by XLF (which is pricing in legislation). This doesn’t seem to be a sustainable rally under these conditions.
September 30th, 2008 at 1:53 pm
Double bottom on SDS 1 minute…
September 30th, 2008 at 1:55 pm
@Paul: Are you making any money in the stock market or are you just posting:?:
September 30th, 2008 at 1:59 pm
YES!!!!
ICE - $10.00 for a moment.
September 30th, 2008 at 2:10 pm
September 30th, 2008 at 2:16 pm
K - thanks, ICE and I needed it.
September 30th, 2008 at 2:20 pm
anybody going long or short overnight? WTF down 777 up 777
just kidding
looks like the market doesn;t need a bailout. it self corrects
September 30th, 2008 at 2:21 pm
That SDS 36MA support is and often will create ranging which leads to whipsaws. Get rid of the noise by going to a higher time frame. If the 1 minute is too busy, go to 5 minute, etc.
It will smooth the direction.
September 30th, 2008 at 2:30 pm
K; lol…
Look at the daily SPX. That green candle looks smallish next to the red candle.
September 30th, 2008 at 2:46 pm
we’re losing 50 pts tomorro on spx and gaining 50 the next day
September 30th, 2008 at 2:48 pm
Thanks, Matt. That is really ironic. It’s not like Mark-to-Fantasy actually changes the value of the assets, although I did read someone’s (Dblwyo?) link on how unreasonable some assets are priced at.
Still, more transparency, not less is what is needed.
On the other hand, Mark-to-Fantasy solves the liquidity issue, since it makes banks solvent by the new accounting standards. So we will see in a year or two’s time when housing stops dropping if solvency or liquidity was the bigger issue
September 30th, 2008 at 2:50 pm
Does anyone actually get it?
Our economy is doomed based on two simple principles:
1.) our assets are over-valued (i.e. a house that was valued at 400Kis worth only 200K)
2.) our debt service costs are greater than what our income can cover.
The Paulson plan addressed neither of those indisputable facts. All the plan did was to recap the banks - essentially giving them the payoff on mortgages that reflected the inflated/untrue valuation of housing. This would, of course, free up the credit markets, but who could actually borrow? the consumer who now owes 400K on a house that will be valued at 200K in the near future? the company that sees its inventory levels rise and demand slacken due to the debt-strapped consumer? Nope.
Also - just to show that this 700B would be similar to shredding money, losing it in a blackhole or, to quote Denninger - piss it into a tornado - Bernanke injected 630B into the markets BEFORE the vote even started. A lot of good that did…
FYI - look into the NY FED meeting on AIG - note that there was a non gov’t official involved in the discussions and they were from GS - THEY WERE THE ONLY ONE. Look into it and you’ll see Paulson’s true motivations.
September 30th, 2008 at 2:54 pm
also the volume today…anyone have any real stats? seems reallyyy low
September 30th, 2008 at 2:55 pm
Dressguard,
Making money today, but as I wrote, I was too long healthcare yesterday, so I’m still down about 2% the last two days.
September 30th, 2008 at 3:04 pm
questioning,
Here’s the issue: there are plenty of methods that the government can use to prop up asset prices. I agree that in the long run, they won’t work. What do you suggest an investor do?
If you stay out of the markets completely, inflation (caused by govenrment intervention) will reduce your buying power.
If you short the market long-term, you run the risk of the PPT screwing you over, or the market ignoring fundmentals, so by time you are proven right, your funds are gone.
September 30th, 2008 at 3:06 pm
Sorry to hear that. I just admire how you are trading and posting at the same time. Are you more a long-term speculator/investor. I normally don’t daytrade. Except today. But that was only because I wanted to get out. Gut feeling wasn’t too good after all. I hold my FXP babies just two days or so but would have hold longer. But yesterday they exploded and I sold them (prematurely).
September 30th, 2008 at 3:07 pm
unlike mccain who plays the blame game …
Obama calls on Americans to support rescue plan
http://news.yahoo.com/s/ap/20080930/ap_on_el_pr/obama
September 30th, 2008 at 3:07 pm
questionning,can you post a link to thatAIGmeeting? Thanks
September 30th, 2008 at 3:08 pm
The market is starting to look wedge-y to me. If I were long at the moment, I would be taking profits here.
September 30th, 2008 at 3:11 pm
I think I’ll clean out. Just scalp remainder of day.
I am proud of ICE today, still moving, too. Hope you all got some of that action.
September 30th, 2008 at 3:14 pm
i got none but it’s ok i don’t want to stay awake all night. so today i won;t even take an overnight trade.
September 30th, 2008 at 3:14 pm
I expect sellers to pour it on the last half hour, but you never know. I’m not sure how much fear there is. I guess not much since most of the population didn’t want the bailout.
September 30th, 2008 at 3:15 pm
Hey, my fault for relying on Congress for my investments.
I don’t daytrade, so that gives me more time to post. Also, I’d prefer holding my investments for a few weeks to 2-months, but there is so much unpredictable (intervention) volatility, that is getting risky. I’ve been holding for shorter and shorter periods. I’m defintely a beginner when it comes to daytrading.
September 30th, 2008 at 3:18 pm
SKF can;t seem to break MA am in at 105.9 screw it her we go!!!
September 30th, 2008 at 3:19 pm
5 min MA is 105.99 so i was betting on it to break. that’s all.
September 30th, 2008 at 3:20 pm
K;
Which chart are you watching? Time frame?
September 30th, 2008 at 3:20 pm
Okay
September 30th, 2008 at 3:25 pm
ok i i am estupido once more haha
not a prob hold it overnight and go bankrupt tomorrow.
September 30th, 2008 at 3:25 pm
Matt - wedgy ? Tech term
Take your point, had similar conclusion but based on indicators + looked up an up-channel getting broken just eye-balling it. You eye and education is better than mine.
p.s. - 1K/day. Wow and ouch. Not my game. Ambition is to get in, ride and trend and get out. Preferably on a multi-month/multi-week basis. In this chaos no feasible so daily.
George - climate of opinion is evolving rapidly. All the ideologues won Mon but all the silent majorities who though the bill would pass are speaking up in the last 24 hrs going WTF - get your damm acts together or we’ll brand you (that’s a euphemism and you need to know what else happens during branding season)
All the corp execs are speaking up, David Brooks just wrote one of his angrier WTF columns and Barry stood up and said we damm well have to pass this as ugly as it is. Did a better job explaining than anybody else so far. Keeps it up and elections over. That’s an assessment btw not a positional statement of preference before the electronic letter bombs arrive.
Sentiment will change therefore IMHO. Should have heard the callers-in on CSpan yesterday… they were breaking down.
September 30th, 2008 at 3:25 pm
The market is moving up on another FASB news story saying that an accounting rule change could come as early as today.
September 30th, 2008 at 3:25 pm
am watching 1, 5, 10, 15
September 30th, 2008 at 3:28 pm
shoot - right after I sold my position the market jumped up. Next ppt/sec nonsense I suppose.
September 30th, 2008 at 3:29 pm
Use the 1 minute with confirmation of the 5, or 5 and 15.
Any time below the 36MA, don’t expect a big move = fighting the trend. Can’t expect the 15 minute to confirm a 5 minute under that condition unless the 15 minute candle clears the 9 MA.
September 30th, 2008 at 3:30 pm
at least you made profit. hehe i can;t seem to pass one day without losing my brain and making stupid moves
September 30th, 2008 at 3:40 pm
the best thing would be to get out now.. but i somehow smell another dead fish tomorrow.
September 30th, 2008 at 3:41 pm
It has been down all day on the 15 minute but has made some good 1-5 minute moves. The 15 minute is like a big boat, takes a while to turn around.
Do you have a stop?
September 30th, 2008 at 3:42 pm
it’s not a big position so no stop on this one. just 10 shares..
September 30th, 2008 at 3:45 pm
so the market jumped because the SEC gives companies more leeway in guessing the value of illequid assets. Rally fueled by denial. Could they please start implementing rules which will bring transparency and not obfuscation.
September 30th, 2008 at 3:50 pm
is anyone going to establish a short position today? Huge rally today means.. no bailout required? or that it is a done deal?
September 30th, 2008 at 3:52 pm
oh tyey wull do the “bailout” don;t know when. they still have to save their asses and throw more on us. these fake rallies are great for us though
September 30th, 2008 at 3:53 pm
Yerk -
Hope this link works… 5th paragraph in….
http://www.bloomberg.com/apps/news?pid=20601203&sid=aTzTYtlNHSG8
As an investor - since fundamentals are no longer believable - I guess you have to go with the charts. 1160 here is no-man’s land… Make no mistake we are in a bear market - and will be for some time - like Matt said “Bear Market Growls Until January 2010″. COF looks juicy - might take a bite on some way OTM puts - Mar 09… Especially since both AXP and DSC have stated negative views, coupled with the fact that both AXP and DSC have higher standards on their apps.
As a citizen, I have to do what I feel is right - trying to stop Paulson from robbing us blind to help his buddies. Do you realize that the 5 positions on the supervisory board that was proposed on yesterday’s revised bill would have consisted of the 1.) Fed Chairman, 2.) SEC chariman, 3.) the Housing Secretary, the 4.) head of the Federal Home Finance Agency and - believe it or not - 5.) Paulson himself (Tres Sec.) - WHAT A JOKE. Do you think that these individuals want the true housing prices to establish themselves in the marketplace? Maybe - but only after all the banks are made whole…
September 30th, 2008 at 3:56 pm
1 min SKF looking ok. might hold overnight. we shall see in 5 mins
September 30th, 2008 at 3:56 pm
Charlie;
I’m flat at the end today. I’m clueless what will happen. If I had to guess, the SSO uptrend will continue until the 30 minute hits the 36MA. The 60 minute is moving up showing strength, but it is still in a down trend.
If I had to stick with something over night, it would be SSO.
September 30th, 2008 at 3:57 pm
hahaahh i love it how the second i say something it plunges!
September 30th, 2008 at 4:00 pm
Man, BBT just popped $2.00 to the upside.
September 30th, 2008 at 4:00 pm
ok so I’m long ovrnight on SKF
September 30th, 2008 at 4:02 pm
SKF had a popup, too. Go figure.
I know what that was, employee shares. It won’t hold.
September 30th, 2008 at 4:02 pm
This is a beautiful quote from that article…
“Paulson said Sept. 16 that he talked with lawmakers about AIG and on Sept. 17 endorsed the AIG financing package. The Fed appointed a member of Goldman’s board, Edward Liddy, to run AIG, replacing Robert Willumstad. Liddy resigned Sept. 26 from Goldman’s board.”
Cronyism at its best…
http://www.bloomberg.com/apps/news?pid=20601203&sid=aTzTYtlNHSG8
September 30th, 2008 at 4:05 pm
WOW MOMA!!! GOOG 200 today LOW lol and now back to 400. someone made some money there
September 30th, 2008 at 4:10 pm
4 million shares of google dunked in 3 mins and all the volume today was 12 million total. WOW what an unloading
scottrade shows Today’s low at $0.01 lol
September 30th, 2008 at 4:12 pm
Hate I missed GOOG. For sure. And I thought ICE was something.
September 30th, 2008 at 4:12 pm
I sold my SSO at 49.5 today.
Broke even on my purchase yesterday.
The next big drop will not occur until AFTER the bailout bill is passed IMHO.
Hopefully it will be better than the original.
September 30th, 2008 at 4:13 pm
damn so i guess sometimes we should put buy orders at 100% lower than the stock price at the end of the day and hope it gets filled?
September 30th, 2008 at 4:15 pm
my core is in TIP, USAGX(gdx)
SKF is a swing trade i am in denial
over …thinking should trade out
& start doing small daytrades until
i develope discipline
thanks to all
September 30th, 2008 at 4:26 pm
Thanks for the link… The second sentence below goes right in the face of those who proclaim that prices are too low, the market does not work and only govt can identify the right price. The stuff is overvalued and has to be written down. If overpaid by the govt the taxpayer pays to protect the bad and to hurt the good banks.
“S&P estimated that AIG had market-value losses of more than $37 billion as of Sept. 15. While it is possible that those CDOs are undervalued, S&P said “it is unlikely that any gains will be recorded before late 2009 or 2010.”
September 30th, 2008 at 4:34 pm
George - once we were past the gap up at the open it looked like the markets moved in an up-channel until the end of the day and closed above it and weigh away from the bottom. Perhaps so Big Mo going into tomorrow. IRX doubled - people are very complacent about a) bill approval and b) results. We get thru this mess and there’s still a real recession waiting in the wings. But I’ll take a) anyway ’cause the alternatives are really ugly.
September 30th, 2008 at 4:36 pm
PS - inflation won’t be an issue. Here’s a great link that will explain it all.
http://benbittrolff.blogspot.com/2008/09/inflation-deflation-money-velocity-and.html
“Forget about inflation. There has never been in the history of the world an inflationary run while land prices were declining. The amount of debt being destroyed as the monster of all debt bubbles implodes will suck down all asset prices and just absolutely collapse the velocity of money.”
September 30th, 2008 at 4:39 pm
Banks know that deflation is in the cards - that’s why they’re screaming so loud for this to pass now. Imagine the revolt if they were to ask for this after housing prices fell another 10%…
September 30th, 2008 at 4:43 pm
I know Matt and others mentioned End of Quarter and EoM markups. This rally seemed a bit overdone without a bill passed of yet. I’m
September 30th, 2008 at 4:50 pm
Yerk,
Not that I like defending banks, but I think that S&P quote is understood. The CDOs are priced in anticipation of certain loss levels. The banks’ default estimates are lower than the market’s. This is why the banks are claiming a liquidity problem: they say that over time. the true value of CDOs will be higher than the current market rates.
If the US paid market-value rates on all the securities, then the plan would be GREAT for taxpayers. However, Paulson and Bernanke want to pay higher than market rates, but how much higher is the question.
September 30th, 2008 at 5:06 pm
questioning,
Inflation is an interesting term - because everybody (I’m including myself) talks about it without defining it. Even during Japan’s well-known deflation, prices increased on many goods.
Let’s observe:
1) Gas prices have been rising (will never drop below $3/gal)
2) Grocery food has been rising
3) Houses have been dropping
4) Restaurant prices have been dropping
5) Electronics have been falling
6) Clothing has been falling
7) Rents have been rising
I think all of these trends will continue, which hurts low-income workers the most.
September 30th, 2008 at 5:14 pm
RE: StockConsultant.com. Forgot to caution that this site also has “bullish/bearish” analysis that I’ve found to be about 50% correct, so I don’t use that aspect; however, it has tremendous resources that quickly gives you relevant news, support/resistant levels, etc., all in one place.
September 30th, 2008 at 5:21 pm
Paul F,
no need to defend banks
I still think s&p has a valid argument (omg, me defending s&p). The reason that there is no market is that house prices are still dropping like a stone and banks cannot afford to write down the credit and derivative exposure on their books. Some have jumped in way to early and a part of the hedge fund problem stems from this mess.
The 630 bln liquity last week infusion should have helped all these problems (if we were to have a liquidity problem) - the 700 bln bailout over years will not save the day.
September 30th, 2008 at 5:23 pm
I get it questioning.
September 30th, 2008 at 5:36 pm
Hi George Nubert,
you here again
I thought you must have had enough after Matt slapped you left and right. Remember: “Not only are you a shithead, but you are a stupid shithead.” 
September 30th, 2008 at 5:54 pm
thinking QID , SDS overnit
September 30th, 2008 at 6:26 pm
hehehehe
Nasdaq probing possibly “erroneous” Google trades
http://www.reuters.com/article/businessNews/idUSTRE48T8C220080930?feedType=RSS&feedName=businessNews
September 30th, 2008 at 6:33 pm
hi guys, congrats to whoever made $ today, i’m still on the sidelines for now, i admire whoever is handling the volatility…the mkt seems like a nutty freak show..
September 30th, 2008 at 6:59 pm
Dblwyo: Re: up channel.
I like seeing those charts where there are channels, flags, and things like that. They seem simple to follow.
I have two problems with them. First, I don’t know where to begin drawing the lines from point-to-point; secondly, I haven’t found out how to use those on real-time charts and which packages facilitate that function.
I’m taking some online tutorials right now that includes those. I’m in a “stochastic rut” right now, I suppose because it works for me. Nothing wrong with that, but I would like to get a broader scope with advanced tools.
September 30th, 2008 at 7:24 pm
George - it’s magic ! And Matt is the master for sure. That said I just started drawing (my timeframe worked better) using Powerpoint on clips. However Stockcharts lets you annotate a chart and with the topend membership will apparently keep them current as well.
Been doing it for a couple of years now and, seriously, the eye begins to see things. I like to draw mine at the open/close not the H/L of candlesticks because to me that’s the central tendency. But I’ve used line charts for longer timeframes as well.
I could upload today’s and let you take a look if you like.
September 30th, 2008 at 7:29 pm
i’d like to see it
September 30th, 2008 at 7:29 pm
buy QID , if market moves or gaps up ……
skf enough exposure overnit
September 30th, 2008 at 7:46 pm
I was sooo close to buying some SPY calls this morning but just couldn’t pull the trigger. Hell, VIX in the upper 30’s last week was preventing me from going short. This markets a bit to crazy right now.
questioning: I agree that the bailout doesn’t address the bigger picture, but we have come incredibly close to a complete systematic failure twice in the last two weeks. Do we really want to keep calling Wall Street’s bluff? The general public acts as if this isn’t their problem when in fact it is entirely their problem (though they may have played a minor role in causing it).
The public is too ignorant of the fact that lending (in moderation, of course) keeps the economy running. They all want to hang these banks out to dry but they assume there will be no consequences. We are arguing about who started the fire while we’re still in the burning house. Is it worth risking a depression just so we can say that our principles are intact?
I’ve looked at Karl Denniger’s plan briefly and it came off as incredibly unrealistic. He must think his readers are fools if he actually believes his plan would cost the taxpayer “nothing”. Direct cost and indirect cost appear to be two different things to him.
1. He wants the banks to mark to market. Don’t we all.
2. He wants CDS traded on a regulated OTC exchange. If they can’t get their act together, the contracts are void.
3. He want’s a limit on leverage of 12:1.
If it’s only 5% of the banks that have issues, I could see this working….What if they’re ALL insolvent? What if they all have major exposure to CDS’s? How do you instantly de-lever a bank from 30:1 to 12:1?
His plan is a great read of what we should have done or what we should do when we get out of this mess. I would support it fully as future regulation, but it appears suicidal right now. Sorta like self-amputation by shotgun.
Sure, half of us are unemployed, but it cost the other half “nothing.”
September 30th, 2008 at 8:36 pm
K/George: http://llinlithgow.com/bizzX/MktCharts/MktQ308/SP30Sept08.jpg
FWIW.
Towlie for a tour of the sausage factory: http://tinyurl.com/539ajb
Either we fix this or it fixes us (the same way we used to fix the yearlings into steers).
Everybody’s lost sight of the recent economic news but the 2nd most important economic stat, personal consumption, went into the tank. GDP is likely to be negative this quarter as a result…welcome to the tipping point.
September 30th, 2008 at 9:01 pm
WASHINGTON - In a surprise move to resurrect President Bush’s $700 billion Wall Street rescue plan, Senate leaders slated a vote on the measure for Wednesday — but added a tax cut plan already rejected by the House.
http://news.yahoo.com/s/ap/20081001/ap_on_bi_ge/financial_meltdown
Well my SKF might be dead but if the bill fails again…then BUEHAHAHAHAA