Sunday, December 14, 2008


This is a very interesting week. It's kinda an in between week. We're not close enough to the end of the year for Window Dressing, or technically January Effect, but based on last week's action we SHOULD go up, potentially dramatically. Sellers look about spent and the market is reacting to every piece of bad news as though its meaningless. Shorts have to be frustrated at this point. There is, however, the flip side which is that reality is anyone buying here for more than a trade is going to lose their money in a big way, AND Friday's move up made a lot of sense since a gap down on a Friday of that magnitude means every short who has a brain covers. That's what the general media and guys on shows that shout military terms fail to get, good traders cover positions at extremely profits and the market goes higher. That doesn't mean that they lost money or are running scared or anything of the kind. To the contrary, it means that they were smart and covered without worrying about leaving some on the table. Capesh?
Here's another thing, I keep hearing that the notion is that if GS gaps down post earnings you should just buy. In fact, I heard one guy who seems like a horrible trader to me, that you should buy with "both fists". Maybe, maybe not, but I think that's kinda a dumb call to be that strong. Not necessarily a poor idea, in fact it may rally post earnings, but I don't think it's a no brainer. Yes, normally that's the trade I'd take, a buy the news situation, but GS may turn out to be a bit different. WE may buy GS post earnings, but let's see what shakes out, you all know long term I think GS sees under $25 and more like under $10. I think GS is worth ZERO, basically. I'm long here, I think you have to lean long until proven wrong here. Having said that, I am just very leery, it almost seems too easy based on every trend I know. That's what scares me, but then again this market has been pretty dead on easy for a while, and things that make sense are really working well (like Friday's gap fade). So, let's just go with it and ride the wave and see what shakes out. I lean long and I am long, but my stops, trust me, are set and I'll reverse if required, I think the stars are aligned, though, for us to get a bust out over 8500 and we should see 9000s this week if thats the case. We shall see soon enough, stay tuned!

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Tammy said...

Hi Waxie, I don't understand: you say: for us to get a bust out over 8500 and we should see 9000s this week if thats the case. But Friday it closed at 8629.68. Didn't it already bust out over 8500? Tammy Saxe

beach2788 said...

Waxie, who or what group of people are supposed to start buying? The average Joe is not goig start putting his money, same with retired people already hit hard, especially with all the bad news coming out. Day traders, ha, that rally will not last long. The only group left then, are fund managers , so I guess this supposedly upcoming rally will all be fund driven. What happens if the fund Mgrs get scared, and say lets sit and wait, how the 1st qtr plays out.

tokyo_yoyo said...

Damn, Waxie,
As if the concensus or ideas you receive through correspondence are worth nil.
Get it straight: You benefit your subscribers. You make a call. It's just a matter of percentages right v. wrong. No matter what you do, there is an equilibrium. There is always a sum, someone, on the other side of the trade.
I try to offer ideas benificial to all. For free.
Idea 1: Allow IRS IRA deduction to include Mortgage principal pay down.
Modification sent to Obama transition 12/16/08: 1 to 100% existing IRA/SEP/any retirement account, transfer to mortgage principal. Roth = 0% penalty. Traditional = 2009 Throw a Bone % penalty.
Dominoes topple other dominoes,
Ripples create new waves.

Email anytime,