We got some followthrough, though the Nasdaq lagged quite a bit. It's always interesting when you see changes in leadership, even if its short term. Today the financials led us higher. Gold did indeed get smacked down. Oil down early but after inventory #s squeezed like a mad beast and was up over $4!
The market still managed to stage a nice rally. We had a VERY nice day. We caught FSLR for an average of around $5.50, we got AAPL short for about $3 into lunch, we got out of our MER calls from yesterday's Option Trader play for a very nice gainer, we got X for about $4, we got a few others for nice gains, and we had 1 loser early on a stop out in GS for about $1.50 loss. ICO our small cap monster and Option Trader play finally starting to motor here, and TIE which I mentioned here last night got a late push. We'll see. I also called SOLF and CSIQ after hours on FSLR earnings. I think they should both gap up nicely and perhaps squeeze to the upside. We'll see but I think low risk entries were had by anyone after hours in the chat room who played them. As far as Thursday goes, it'll be interesting. This market is truly psychotic. And, it is truly a TRADERS market and nothing else. It gets pushed up and down on mere whims at this point. I still think its a bit early to get back into the financials short as we could get a further squeeze up. I hope so. I would love to see the S & P at 1350 area as that would be the perfect short. Get the ER to our 735 target and same deal. One note, GRMN, on our TOP TEN TECH SHORTS list proved us right so far by getting cracked, the puts I mentioned in the class already up well over 100%! Now thats a nice instant gratification! Watch GOOG and AAPL on the next round of selling. They both look very vulnerable. I would like to get GOOG to push to $500 area for the best short entry on it, and with AAPL get it to $175, if it can get that high and I'll be salivating. In the meantime, let's enjoy the ride, a gap down again is buyable more than likely. We've had 3 trendy like days in a row, its very very rare to get 4, so chances are we'll be whippy most of the day. I don't have much of a strong opinion on the day here, I think its likely to chew ya up if you overtrade, so hang tight and pick your spots, please. Like I said, I do like CSIQ and SOLF if they squeeze for a trade only. They both have earnings upcoming and after FSLR blowout chances are they will squeeze pretty nicely here! We'll see soon enough on all! RULE! Waxie
Wednesday, July 30, 2008
Tuesday, July 29, 2008
There ya go...
Day late, few dollars short, but we did and are indeed getting that pop we expected! Let's see if we can have any follow through on Wednesday after the Turnaround Tuesday! Pretty amazing how Tuesday truly goes get many snap back rallies! And, today was no different - WOWSA - very nice trend day UP, a day after we had a huge trend day DOWN!
That does not happen very often, but this market is full of psychotic surprises! The volatility is intense, and CASH IS KING here as we can't honestly predict from day to day whats going to happen here.
I suspect we get that 730s on the ER (it closed at 714) and perhaps the DOW can motor a bit more. From there we'll have a hard time I suspect, but again, I do think Oil has peaked at least short term and I think the dollar has some more upside and Gold has a LOT more downside from here. If it breaks (when) below $900 and holds below it, it could easily fall another $50 to $100 without blinking. Today we bought some depressed stocks and we played the MER $22.50 calls for a NICE sweet FAT gain! In truth, we also played initially the GS $180 puts and stopped out. That's trading, though. You make a mistake, you realize it and reverse. Net/net positive!
I like TIE potentially here.Stock is heavily shorted I believe, and its near its 52 week lows and the CEO just bought nearly 200,000 shares MUCH higher than here AND they have earnings August 4th or 5th! To me, that's a nice setup for a nice move with low risk since I would set a stop around $10.29. Would think $15 is within reach if the call is correct,otherwise worst case stop out. Today also there was a rumor about the company taking itself private. With the CEO buying a ton of shares, that could be possible, though rumors like that rarely pan out.
They are, however, often a precursor of a bigger move and I have to think that move will be UP and not down!
If we get a gap down Wednesday I think its an automatic BUY, at least for a trade, assuming there isn't any bad news.
I want to just briefly explain why the MER news today was so horrible cause clearly the market got it DEAD WRONG!
I point to two recent news items that are comparable. WB and WM.
I believe both are eerily similar, and what's even scarier is that the market reaction is nearly identical to their news as well!
Both WB and WM, and now MER took on new capital in the form of common stock sale BELOW current stock prices. Today MER sold $8.5 BIL worth of stock at $22.50.
The stock market took this as a sigh of relief, believing that there is now a "floor" at $22.50 that the stock is supported at. BUT, if you take a close look at the deal, at least my interpretation of it, these deals almost always involve WARRANTS for the purchaser to buy even more shares at the same or a lower price. That dilutes the share value even more. Further, these deals often have "puts" to the buyer which protects them above and beyond all others.
How does that work? Well, often times what happens is the buyer says "look, the market is bad right now, we don't want to buy your MER stock today at $22.50 and then you need more capital and you sell it to someone else at the same or lower price and crush our investment!
So, then the company basically "guarantees" that the investor would get locked in at the $22.50 or higher no matter what if they take on more investors in the stock. This has the affect of hurting their ability to raise additional capital as needed and it further still dilutes the value of the common stock.
Like I said, read the WB and WM deals, they are basically the same as best I can tell. And, both those stocks rallied (WB not really, but WM certainly did) on the news, and the pundits said the same thing, "now we have transparency!". WM sold shares at roughly $8.50 area if I recall and WB I think it was in the $20s. Since that happened WB has seen $8s and WM has seen $3s. MUCH lower than the investment prices.
As a trend player all I can do is go on historical data. We BOUGHT MER long today and made out nice! It's very VERY possible MER gets back to $30s here short term. Longer term I think the common stock of MER is DONE and I will be looking to short it once this move has run its course. I would love MER to see $35 or higher, to me thats an instant short unless some news changes things.
In the meantime, there ya have it, a lot of info, go get 'em!
RULE!
Waxie
That does not happen very often, but this market is full of psychotic surprises! The volatility is intense, and CASH IS KING here as we can't honestly predict from day to day whats going to happen here.
I suspect we get that 730s on the ER (it closed at 714) and perhaps the DOW can motor a bit more. From there we'll have a hard time I suspect, but again, I do think Oil has peaked at least short term and I think the dollar has some more upside and Gold has a LOT more downside from here. If it breaks (when) below $900 and holds below it, it could easily fall another $50 to $100 without blinking. Today we bought some depressed stocks and we played the MER $22.50 calls for a NICE sweet FAT gain! In truth, we also played initially the GS $180 puts and stopped out. That's trading, though. You make a mistake, you realize it and reverse. Net/net positive!
I like TIE potentially here.Stock is heavily shorted I believe, and its near its 52 week lows and the CEO just bought nearly 200,000 shares MUCH higher than here AND they have earnings August 4th or 5th! To me, that's a nice setup for a nice move with low risk since I would set a stop around $10.29. Would think $15 is within reach if the call is correct,otherwise worst case stop out. Today also there was a rumor about the company taking itself private. With the CEO buying a ton of shares, that could be possible, though rumors like that rarely pan out.
They are, however, often a precursor of a bigger move and I have to think that move will be UP and not down!
If we get a gap down Wednesday I think its an automatic BUY, at least for a trade, assuming there isn't any bad news.
I want to just briefly explain why the MER news today was so horrible cause clearly the market got it DEAD WRONG!
I point to two recent news items that are comparable. WB and WM.
I believe both are eerily similar, and what's even scarier is that the market reaction is nearly identical to their news as well!
Both WB and WM, and now MER took on new capital in the form of common stock sale BELOW current stock prices. Today MER sold $8.5 BIL worth of stock at $22.50.
The stock market took this as a sigh of relief, believing that there is now a "floor" at $22.50 that the stock is supported at. BUT, if you take a close look at the deal, at least my interpretation of it, these deals almost always involve WARRANTS for the purchaser to buy even more shares at the same or a lower price. That dilutes the share value even more. Further, these deals often have "puts" to the buyer which protects them above and beyond all others.
How does that work? Well, often times what happens is the buyer says "look, the market is bad right now, we don't want to buy your MER stock today at $22.50 and then you need more capital and you sell it to someone else at the same or lower price and crush our investment!
So, then the company basically "guarantees" that the investor would get locked in at the $22.50 or higher no matter what if they take on more investors in the stock. This has the affect of hurting their ability to raise additional capital as needed and it further still dilutes the value of the common stock.
Like I said, read the WB and WM deals, they are basically the same as best I can tell. And, both those stocks rallied (WB not really, but WM certainly did) on the news, and the pundits said the same thing, "now we have transparency!". WM sold shares at roughly $8.50 area if I recall and WB I think it was in the $20s. Since that happened WB has seen $8s and WM has seen $3s. MUCH lower than the investment prices.
As a trend player all I can do is go on historical data. We BOUGHT MER long today and made out nice! It's very VERY possible MER gets back to $30s here short term. Longer term I think the common stock of MER is DONE and I will be looking to short it once this move has run its course. I would love MER to see $35 or higher, to me thats an instant short unless some news changes things.
In the meantime, there ya have it, a lot of info, go get 'em!
RULE!
Waxie
Monday, July 28, 2008
Whoops there it is!
Well, so much for a Monday rally! Man, they are relentlessly punishing this market! And, unfortunately, rightfully so! This may be make or break time here, folks. We're going to get cracked hard all around, or we'll get another turnaround Tuesday and a snap back.
I'm gonna stay neutral. obviously longer term I feel STRONGLY that we are TOAST, and that the DOW sees 7500 before it ever sees 14,000 again (or probably 13,000, or maybe even 12,500!). But, as a trader I try to keep as neutral as I can day to day. Bear markets snap back like we had last week and if you aren't on your toes you get them broken when the elephant steps on them.
I have been watching and trading and analyzing the markets for over 10 years now. I have to tell you guys and gals that I have NEVER felt this kind of heaviness. Yes, we've had many steep declines and a couple of Bear markets, but there is a heaviness that is much more "in the know" in my belief. We very well may wake up one day and see 200+ points washed away from the S & P, and that 1000+ points on the DOW and 250 points on the Nasdaq. That's why I really don't see any safe havens in this market. Sometimes there isn't any "Bull Markets" somewhere!
Let's stay neutral. I hope it's turnaround Tuesday, it'll help us establish some positions soon in the market from the short side again.
In the meantime, trade SMART! The short class is and will rock in my view. SO far so good! That's why we leg into stuff so we have some exposure to the plays no matter what.
let's see what shakes and go from there manana!
RULE!
Michael "Waxie" Parness
I'm gonna stay neutral. obviously longer term I feel STRONGLY that we are TOAST, and that the DOW sees 7500 before it ever sees 14,000 again (or probably 13,000, or maybe even 12,500!). But, as a trader I try to keep as neutral as I can day to day. Bear markets snap back like we had last week and if you aren't on your toes you get them broken when the elephant steps on them.
I have been watching and trading and analyzing the markets for over 10 years now. I have to tell you guys and gals that I have NEVER felt this kind of heaviness. Yes, we've had many steep declines and a couple of Bear markets, but there is a heaviness that is much more "in the know" in my belief. We very well may wake up one day and see 200+ points washed away from the S & P, and that 1000+ points on the DOW and 250 points on the Nasdaq. That's why I really don't see any safe havens in this market. Sometimes there isn't any "Bull Markets" somewhere!
Let's stay neutral. I hope it's turnaround Tuesday, it'll help us establish some positions soon in the market from the short side again.
In the meantime, trade SMART! The short class is and will rock in my view. SO far so good! That's why we leg into stuff so we have some exposure to the plays no matter what.
let's see what shakes and go from there manana!
RULE!
Michael "Waxie" Parness
Sunday, July 27, 2008
Rally early this week?
Two more regional banks failed over the weekend. It'll be interesting to see how that impacts the overall market. Congress decided once again to do the absolute WRONG thing with this new housing bill. Why don't they just give people their houses for free? We can re-become a homestead country. I'm going to rush out and claim some land in NYC tomorrow! Why not? It's the most idiotic thing yet, these guys and dolls are so completely clueless we'd be better off having Hannah Montana running the country. Or, a hampster. I think they may have better ideas and insights. I know, I rant and rant, but it's just so frustrating to see these politicians muck everything up worse. I think the notion of another check being sent out is not even absurd, its assnine. Like the first check helped! NOT!
Having said that, I think the market can get a decent sized bounce potentially this week. Watch the early Monday action for a clue. If we dont get sold early I would think we get a decent sized bounce that provides better short entries. I would probably buy a gap down today, I think we should get some type of bounce, but we shall see.
Going to bed, see ya all tomorrow!
WAXIE
Having said that, I think the market can get a decent sized bounce potentially this week. Watch the early Monday action for a clue. If we dont get sold early I would think we get a decent sized bounce that provides better short entries. I would probably buy a gap down today, I think we should get some type of bounce, but we shall see.
Going to bed, see ya all tomorrow!
WAXIE
Thursday, July 24, 2008
TECH WRECK
It's begun...
Tonights class went well, hope many of you made it. You can get the archive still if you want it. I think we have some good ideas that will pay off handsomely. Unfortunately, when the Dow is 8000s it's gonna be pretty bloody.
We had a total trend down day Thursday. Early on, I have to admit, I was looking for a bounce, but then it quickly became apparent that we weren't doing anything but falling. Trend days are usually the easiest trading days because you can pretty much pick a spot on any bounce and just follow the direction of the trend. We shorted AAPL late day for roughly $2.50, and we were long SKF via calls from the day before anyway (another 100% winner in a day!).
You'll notice that oil practically pinned the $125 strike price for the monthly expiration. It's a handy trick to have as you can trade things around strikes when you have something hovering around a specific strike. I got asked about oil a lot today for whatever reason. I'm kinda neutral on it right now, but I do think there's a decent shot it retraces to around $100. Too many people still look at it as something that has to go straight up, and the govt is really trying to assert itself to push it down. LONG term I think it's $250. I'm a peak oil theory guy. And, unless there's world peace unfortunately there will be a lot of supply disruptions. It's interesting, the commodity trade was so crowded it had to tank hard. Having said that, it's unlikely that we've seen the last of food commodity madness. There's simply too little food and too many people. Everyone is supply/demand. So, there ya go, my sorta meaningless info about oil and commodities, without committing either way. Why? Cause I really don't have an opinion this instant, so I prefer to not make something up.
As far as the overall market, I suspect we'll get at least an attempted bounce Friday. Friday is often a day people square up their positions ahead of the weekend. We'll see, but I stick to my thesis that any rally is shortable here. Upside remains pinned to under 12,000 and downside is limitless. I guess there's a chance we get a rally higher than 12,000 but I would indeed be surprised - very. I will say I have no idea who was buying MER at nearly $35 thinking it was a bargain! I know the shorts had to cover, but funds were in there as well. Oy, thats painful, these stocks are simply not going anywhere for a long while. Yeah, ok, they will get massive squeezes at times, but the overall downtrend is going to be hard to truly break for a while. Snap back rallies in Bear markets tend to be violent. We got that and we'll get more of the same. A sustained bull run doesn't happen all at once, it kinda creeps up on ya usually and is a stutter step move, not all at once. The economy is getting worse, not better. I'll really refrain from going off as usual on what the powers that be are doing in destroying any real hope we have of a real sustained economic rebound. Every day there is another insane and insepid bill someone is trying to get passed, or that does pass that is just setting us back more and more. It's like a confederacy of dunces. I really think they should just make it so you can't short the market AT ALL. In fact, just make it so that the market has to go up only, just shut down the markets if a single seller of stock emerges. Lunacy, sheer lunacy. It would be one thing if it were to help, but it can't possibly help.
You want to know what to do to get the economy out? Let it tank hard and fast and then rebuild. Delaying the inevitable just means it lasts a whole lot longer. Sucks, but truth.
See ya manana!
RULE!
Waxie
Tonights class went well, hope many of you made it. You can get the archive still if you want it. I think we have some good ideas that will pay off handsomely. Unfortunately, when the Dow is 8000s it's gonna be pretty bloody.
We had a total trend down day Thursday. Early on, I have to admit, I was looking for a bounce, but then it quickly became apparent that we weren't doing anything but falling. Trend days are usually the easiest trading days because you can pretty much pick a spot on any bounce and just follow the direction of the trend. We shorted AAPL late day for roughly $2.50, and we were long SKF via calls from the day before anyway (another 100% winner in a day!).
You'll notice that oil practically pinned the $125 strike price for the monthly expiration. It's a handy trick to have as you can trade things around strikes when you have something hovering around a specific strike. I got asked about oil a lot today for whatever reason. I'm kinda neutral on it right now, but I do think there's a decent shot it retraces to around $100. Too many people still look at it as something that has to go straight up, and the govt is really trying to assert itself to push it down. LONG term I think it's $250. I'm a peak oil theory guy. And, unless there's world peace unfortunately there will be a lot of supply disruptions. It's interesting, the commodity trade was so crowded it had to tank hard. Having said that, it's unlikely that we've seen the last of food commodity madness. There's simply too little food and too many people. Everyone is supply/demand. So, there ya go, my sorta meaningless info about oil and commodities, without committing either way. Why? Cause I really don't have an opinion this instant, so I prefer to not make something up.
As far as the overall market, I suspect we'll get at least an attempted bounce Friday. Friday is often a day people square up their positions ahead of the weekend. We'll see, but I stick to my thesis that any rally is shortable here. Upside remains pinned to under 12,000 and downside is limitless. I guess there's a chance we get a rally higher than 12,000 but I would indeed be surprised - very. I will say I have no idea who was buying MER at nearly $35 thinking it was a bargain! I know the shorts had to cover, but funds were in there as well. Oy, thats painful, these stocks are simply not going anywhere for a long while. Yeah, ok, they will get massive squeezes at times, but the overall downtrend is going to be hard to truly break for a while. Snap back rallies in Bear markets tend to be violent. We got that and we'll get more of the same. A sustained bull run doesn't happen all at once, it kinda creeps up on ya usually and is a stutter step move, not all at once. The economy is getting worse, not better. I'll really refrain from going off as usual on what the powers that be are doing in destroying any real hope we have of a real sustained economic rebound. Every day there is another insane and insepid bill someone is trying to get passed, or that does pass that is just setting us back more and more. It's like a confederacy of dunces. I really think they should just make it so you can't short the market AT ALL. In fact, just make it so that the market has to go up only, just shut down the markets if a single seller of stock emerges. Lunacy, sheer lunacy. It would be one thing if it were to help, but it can't possibly help.
You want to know what to do to get the economy out? Let it tank hard and fast and then rebuild. Delaying the inevitable just means it lasts a whole lot longer. Sucks, but truth.
See ya manana!
RULE!
Waxie
Wednesday, July 23, 2008
AMZN, BIDU and TECH...
I will tell you one thing - AMZN and BIDU are NOT on the TOP TEN TECH short list! Why? Well, AMZN makes too much sense as a play on high oil to me. More people stay at home and order online through a place like AMZN rather than drive out to pick stuff up live. Will that hold up long term? Well, AMZN is vastly overpriced, but for the reason above it could see higher before lower. I wouldn't be surprised if it gets to $85 today. Closed afterhours trading at $76s. I'm not calling it, just saying that they blew out and in this market blowing out is a HUGE sigh of relief and shorts get clobbered.
BIDU is still a growing mini-GOOG and relatively "cheap" though when it gaps up $40 today more than likely its certainly not "cheap" to most value investors. What investors and funds don't look at much is reality. AMZN is $76 after hours. MAYBE they will earn $1.50 this year - MAYBE. So, at $75 they are trading at 50 X's this years earnings. That's absurd in any market thats reality driven, but right now if a stock beats, it squeezes. So, best to stand clear of earnings and let other's guess.
We recalled SKF today at $111 and sold some at $122ish, for better than a $10 gain in about an hour or so. I think financials MIGHT have one more push up and then we should start to back and fill. Tech will at least start off very strong due to AMZN and BIDU, and from there we'll see.
Watch the action early on in some financials, the cool thing is they are trading in WICKED large ranges, which means you can trade them now intraday. That's a very good thing because I find that these types of stocks are more predictable in terms of support and resistence. FNM is having a really hard time holding over $15, thats something to watch if it gaps up again tomorrow/today. Might be worth a short, if it can't hold $15 it should head back toward $12, and then $10 and then...we'll see.
I think the market here is "ok" so I don't see the rush to short everything in sight. In fact, we went long some stuff today for gains, and we shorted GS for better than $2 and RIMM for about $1.50. But, in the end the market ended higher and you need to respect that and not buck the TREND. What we do long term is meaningless, its short term that means ALL!
See ya tomorrow in my TOP TEN TECH SHORTS class!
RULE
Waxie
BIDU is still a growing mini-GOOG and relatively "cheap" though when it gaps up $40 today more than likely its certainly not "cheap" to most value investors. What investors and funds don't look at much is reality. AMZN is $76 after hours. MAYBE they will earn $1.50 this year - MAYBE. So, at $75 they are trading at 50 X's this years earnings. That's absurd in any market thats reality driven, but right now if a stock beats, it squeezes. So, best to stand clear of earnings and let other's guess.
We recalled SKF today at $111 and sold some at $122ish, for better than a $10 gain in about an hour or so. I think financials MIGHT have one more push up and then we should start to back and fill. Tech will at least start off very strong due to AMZN and BIDU, and from there we'll see.
Watch the action early on in some financials, the cool thing is they are trading in WICKED large ranges, which means you can trade them now intraday. That's a very good thing because I find that these types of stocks are more predictable in terms of support and resistence. FNM is having a really hard time holding over $15, thats something to watch if it gaps up again tomorrow/today. Might be worth a short, if it can't hold $15 it should head back toward $12, and then $10 and then...we'll see.
I think the market here is "ok" so I don't see the rush to short everything in sight. In fact, we went long some stuff today for gains, and we shorted GS for better than $2 and RIMM for about $1.50. But, in the end the market ended higher and you need to respect that and not buck the TREND. What we do long term is meaningless, its short term that means ALL!
See ya tomorrow in my TOP TEN TECH SHORTS class!
RULE
Waxie
Tuesday, July 22, 2008
RALLY HOOOOOOO!
Dudes and Dudesses, we need to talk!
Yes, that's right, YOU and me, we need to have a little chit chat, ok?
Today I got a couple of emails from people who read the blog. They were upset because the market is rallying and WAXIE said that LONG TERM the market is headed south!
In fact, one dude said that he read the blog and and he had taken SKF long and is wondering why it's not $250. In fact, he tried to sell it at $147 and just missed by 10 cents and is now "stuck" with it at $121s!
OY VEY. Double OY VEY.
1st off, let me set the record straight. I would not suggest you trade off longer term ideas without a trading plan no matter what.
2nd off, we SOLD SKF right near the open for better than a 50% gain on 3/4 of the calls that were called for OPTIONS TRADER clients yesterday, with the PLAN to stop out of the rest at plus $2 on the calls, which we did stop out of that last 1/4 share lot. So, overall the profit % was roughlly 45%! IN ONE DAY!
We are TRADERS, folks. We don't buy SKF and go "gee, let me ride it for $125" Does that and could it happen? Yeah, it could, but at some point you have to SELL and BOOK PROFITS - OR - sell (or cover) and eat a SMALL loss!
3rd off, I am not sure trading off the blog here is a great idea, particularly if you don't have a real hard and fast PLAN! I'll repeat - we do NOT INVEST!
That means we don't invest LONG, and we don't invest SHORT! Yes, I think we are headed lower and this is nothing more than another Bear market rally that will end ugly.
BUT, along the way we will get MANY MANY MANY rallies, and falls, falls and rallies. We're TRADERS, not investors! Riding a stock from $147 to $121 and saying "now I"m stuck with it" will get you one thing and one thing only - DEAD BROKE!
Hopefully that clears things up.
Now, as far as tomorrow; we will probably chop around a bit. I would fade the open either way, we're overbought here and if we gap up decently it should make a good short, at least for a trade. I would be surprised, but not shocked, if we got much traction either way unless there is some news that moves us. Oil looks shot here, Thursday is the expiration of this month's oil contract and Oil MIGHT get hammered to $125, which would be a nice pin job for them. We'll see.
Someone asked why the airlines moved so much % wise. Ah, the beauty of catching a short squeeze. The market moves mostly on PERCEPTION. Anyone notice that a few days ago the sky was falling and now those same stocks are all rallying like crazy and funds are panic buying them, despite the ridiculous moves they've all had so fast? I mean, GS was $152 and closed today nearly $190! That's a SICK move. Many of the financials have DOUBLED in a short period of time. No, that can not be sustained and won't be. PERCEPTION is that we're still on track to have an economic rebound. I'm sorry, but that's really ridiculous and not based on anything other than wishful thinking. This rally may get a wee bit more, but we're setting up for a very nice short, and yeah, we'll get back into the SKF shortly here. In fact, its looking MIGHTY yummy right about now. If it dips to around $115 to $117 I think its time to stick toes back in the water for a TRADE, but we shall see what shapes up. SKF was $100 about 6 weeks ago, went to over $200 last week and is now down roughly 40% in a few days! That's absurd! Absurd, but thats what happens when you get a big short squeeze and the government restricts, even if its just PERCEPTION, some shorts way of doing things. So, its unlikly without news that we give this up right away. It may be a stair case down this time. We are now back in that denial phase. It's funny, I walk around New York and EVERY DAY more and more stores shut down, but Wall Street and reality take a while to meet and right now, for today, we are all giddy that the bottom is in! If I hear that one more time, I'm going to puke. There is no such thing, its fiction. It's a meaningless word in the markets. It has to be defined. In the meantime, watch for oil to continue to pull back and if so the PERCEPTION may just take us to 1300 on the S & P's. I doubt we got more than that best case in the tank, but we'll see soon enough! RULE! Waxie
Yes, that's right, YOU and me, we need to have a little chit chat, ok?
Today I got a couple of emails from people who read the blog. They were upset because the market is rallying and WAXIE said that LONG TERM the market is headed south!
In fact, one dude said that he read the blog and and he had taken SKF long and is wondering why it's not $250. In fact, he tried to sell it at $147 and just missed by 10 cents and is now "stuck" with it at $121s!
OY VEY. Double OY VEY.
1st off, let me set the record straight. I would not suggest you trade off longer term ideas without a trading plan no matter what.
2nd off, we SOLD SKF right near the open for better than a 50% gain on 3/4 of the calls that were called for OPTIONS TRADER clients yesterday, with the PLAN to stop out of the rest at plus $2 on the calls, which we did stop out of that last 1/4 share lot. So, overall the profit % was roughlly 45%! IN ONE DAY!
We are TRADERS, folks. We don't buy SKF and go "gee, let me ride it for $125" Does that and could it happen? Yeah, it could, but at some point you have to SELL and BOOK PROFITS - OR - sell (or cover) and eat a SMALL loss!
3rd off, I am not sure trading off the blog here is a great idea, particularly if you don't have a real hard and fast PLAN! I'll repeat - we do NOT INVEST!
That means we don't invest LONG, and we don't invest SHORT! Yes, I think we are headed lower and this is nothing more than another Bear market rally that will end ugly.
BUT, along the way we will get MANY MANY MANY rallies, and falls, falls and rallies. We're TRADERS, not investors! Riding a stock from $147 to $121 and saying "now I"m stuck with it" will get you one thing and one thing only - DEAD BROKE!
Hopefully that clears things up.
Now, as far as tomorrow; we will probably chop around a bit. I would fade the open either way, we're overbought here and if we gap up decently it should make a good short, at least for a trade. I would be surprised, but not shocked, if we got much traction either way unless there is some news that moves us. Oil looks shot here, Thursday is the expiration of this month's oil contract and Oil MIGHT get hammered to $125, which would be a nice pin job for them. We'll see.
Someone asked why the airlines moved so much % wise. Ah, the beauty of catching a short squeeze. The market moves mostly on PERCEPTION. Anyone notice that a few days ago the sky was falling and now those same stocks are all rallying like crazy and funds are panic buying them, despite the ridiculous moves they've all had so fast? I mean, GS was $152 and closed today nearly $190! That's a SICK move. Many of the financials have DOUBLED in a short period of time. No, that can not be sustained and won't be. PERCEPTION is that we're still on track to have an economic rebound. I'm sorry, but that's really ridiculous and not based on anything other than wishful thinking. This rally may get a wee bit more, but we're setting up for a very nice short, and yeah, we'll get back into the SKF shortly here. In fact, its looking MIGHTY yummy right about now. If it dips to around $115 to $117 I think its time to stick toes back in the water for a TRADE, but we shall see what shapes up. SKF was $100 about 6 weeks ago, went to over $200 last week and is now down roughly 40% in a few days! That's absurd! Absurd, but thats what happens when you get a big short squeeze and the government restricts, even if its just PERCEPTION, some shorts way of doing things. So, its unlikly without news that we give this up right away. It may be a stair case down this time. We are now back in that denial phase. It's funny, I walk around New York and EVERY DAY more and more stores shut down, but Wall Street and reality take a while to meet and right now, for today, we are all giddy that the bottom is in! If I hear that one more time, I'm going to puke. There is no such thing, its fiction. It's a meaningless word in the markets. It has to be defined. In the meantime, watch for oil to continue to pull back and if so the PERCEPTION may just take us to 1300 on the S & P's. I doubt we got more than that best case in the tank, but we'll see soon enough! RULE! Waxie
Monday, July 21, 2008
TECH SHORT, see ya!
Well, after the close AAPL blew out, but posted poor guidance going forward - DUH! Stock is trading down roughly $15 from the close here now, and looks like it wants the other side of $150.THUSDAY of this week I will be unveiling my TOP TEN TECH SHORTS, I suggest you ALL attend. An alert is going out today and tomorrow to sign up. Yes, its going to cost ya, but if you are an investor here, or a trader I STRONGLY urge you to come to the class. It might just save your butt, or make you oogles of money! I have 10 TECH stocks that I believe will drop AT LEAST 50% in the next 12 months. I'll be detailing some ways to play them, and we'll go over them. Before the class giving the actual plays there will be a SHORTING class I'll teach that will show you how to short stocks if you have never done it. Look, folks, you can believe me, or disagree with me, or whatever you want, but the bottom line is - the stock market is going WAY WAY WAY down over the last few years. You want to sit there with some cotton in your ears, I can't stop you, but if you are investing in this market you are gonna get wasted. Trading? Well, now you're talking! We will get many tradeable rallies/bounces, but eventually most will be fades and shorting opps. AXP reported that hings are HORRIBLE and the stock get CRACKED here. Today we called SKF calls, this is the ETF for the financials. We called it when it was roughly $132.50. It's trading at $143ish after hours and looks like $150 could come tomorrow potentially. Whoops, there goes AAPL below $150, ho hum, who knew? You need to trade this market, forget investing, its a very bad idea folks. The market is going DOWN, and you need to be able to protect yourself AND learn to profit as it goes down. Wake up and smell the coffee even if you don't eat breakfast. TECH is the next sector to CRACK completely. All the idols of the analysts are going to get CRUSHED. AAPL is under $150 and headed LOWER. It's time to get with the program and its time for us to start profiting from what we know is going to happen. FNM hit $18.80 today! Are you kidding me? It's going to ZERO. I stick with that call, and I stick with the SKF to $250 short term and $400s longer term. I'm sorry, I hate to be the grim reaper, but last week's rally was nonsense, it couldn't possibly last long. Join me on Thursday in the TOP TEN TECH SHORTS class I'm giving. Price is $149.00 for the class. The shorting pre-class is $29.95. Ok, I said it all, you can email me if you need further info on the classes - waxie@trendfund.com. So, the day was pretty much flat and choppy. Yes, we were down, but all eyes were on AAPL and AXP...whoops, AAPL is now headed to $147s! Jeez louise, they are cracking this I-Pod monger! We chopped around all day. I called some stuff for Options Trader and we had GDP long for a nice pop late day. I got stopped out of my BIDU short, though that thing looks like it wants to lose it as well with GOOG pushing down heavy (and headed MUCH lower long term). CLearly tomorrow we're going to get a HEFTY gap DOWN. DO we bounce? If so, how much? THese are good questions. I suspect we'll get a nice bounce somewhere intraday, but the overall trend remains DOWN and anyone picking bottoms here is gonna get CRACKED long term I believe. AGs worked again, so did oil as people fled the financials and tech. See ya all tomorrow, lets see what shakes and where AAPL finally lands. Wow, this thing going WAY WAY down here, still falling like a ROCK! Sorry, but just cause a company has good products does not make it worth $150 BIL! Take that to the bank and smoke it, or hash it over! RULE! Waxie
Saturday, July 19, 2008
What now?
OK, so this week Monday's close will be crucial to the health of the market here, particularly TECH, which we feel will be the next in line to sell off. AAPL reports earnings after the close. The stock, like GOOG was, is trading horrendously. Does that mean it sells off post earnings? Not necessarily, but it'll be interesting nonetheless.
The RUT puts played out nicely Friday if you played them. I am staying a big neutral here to see how the week plays out. We may get another push a bit higher. One market that is interesting here remains CHINA. The Olympics are 3 weeks away and their market is cracked, it could get a bounce here that is tradeable. We played the FXI and CAH before with nice results, its not a bad idea here if you use a stop loss. And, it could be a nice hedge if you do short some US stocks here.
We had some awesome calls this week, hopefully a lot of you guys are at least trying our services. Option Trader has been ON FIRE beyond belief. We had GOOG twice this week for HUGE gains, and we had USO puts that more than doubled in two days! We also sold our financial stock puts for HUGE HUGE HUGE gains (LM puts were like 500% gainer, literally!).
Option Trader is our single most popular service at the moment, give it a whirl for a month, no guarantees, but the results for the last year plus have been pretty amazing. I have a lot of testimonials to back it up if you are interested email me at waxie@trendfund.com
Our TOP TEN TECH SHORT class will be held later this week. An alert will go out by Monday for signups. Also, please fill out your survey's if you haven't already, you get a free $25.00 certificate good for use on any product we sell, including the short class, so it's a good use of time and will help us better serve you guys now and in the future.
Friday I made a couple of bad calls, I have to admit. I called LEH long at around $18, which was the right call, but then called SKF long as well, which was the wrong call. We looked early as though they might sell the news on C. I made the mistake of thinking SKF might get pinned higher, which didn't happen, they basically pinned $135. My bad. Hey, it happens. We got MF and made some nice sheckels late day, though, so there ya go, and MF could get a nice gap up Monday if the market decides to stay a bit positive. Monday's open should be a nice fade either way. I think the Bulls and the Bears are lined up and are going to have a nice fight here. A lot of people were caught short, and a lot of funds came in with both fists buying, sending the market zooming. You'll notice what happened, the stuff that was and has been red HOT and the so-called safety stocks, like energy, AGs, and such all SOLD OFF HUGE (hence our USO puts being so steller!). Commodities are cracked here. There is definately a pairing in this market which is a good way to guage and profit from the market. Commodities up, financials and consumer staples down. Commodities down, reversal. Oil $150 was strong resistence, a lot of funds that were long unwound the position over $145. I'd like oil to pull back here as much as anyone, I think $125 looks to be the next level. This weekend if there is good news out of Rice's trip to Iran, and US policy looks to have short term solved that issue, oil SHOULD pull back in a big way and the markets could get a further boost UP.
I like that scenario, I think thats how it plays out, which is why I am backing off the idea of flat out shorting the market this instant. Let's wait and see how it pans out. For the moment, I think oil heads lower unless news overcomes that view. You can short oil futures, I did this week, with Terra Nova (http://www.terranovatrading.com/). That's who we recommend as a broke, and who I use. Tell them Trendfund.com sent you and they'll give you some nice discounts and some free trades I believe.
In the meantime, its a beautiful day in NYC and I intend to enjoy it! See ya all Monday!
happy trading!
RULE!
Waxie
The RUT puts played out nicely Friday if you played them. I am staying a big neutral here to see how the week plays out. We may get another push a bit higher. One market that is interesting here remains CHINA. The Olympics are 3 weeks away and their market is cracked, it could get a bounce here that is tradeable. We played the FXI and CAH before with nice results, its not a bad idea here if you use a stop loss. And, it could be a nice hedge if you do short some US stocks here.
We had some awesome calls this week, hopefully a lot of you guys are at least trying our services. Option Trader has been ON FIRE beyond belief. We had GOOG twice this week for HUGE gains, and we had USO puts that more than doubled in two days! We also sold our financial stock puts for HUGE HUGE HUGE gains (LM puts were like 500% gainer, literally!).
Option Trader is our single most popular service at the moment, give it a whirl for a month, no guarantees, but the results for the last year plus have been pretty amazing. I have a lot of testimonials to back it up if you are interested email me at waxie@trendfund.com
Our TOP TEN TECH SHORT class will be held later this week. An alert will go out by Monday for signups. Also, please fill out your survey's if you haven't already, you get a free $25.00 certificate good for use on any product we sell, including the short class, so it's a good use of time and will help us better serve you guys now and in the future.
Friday I made a couple of bad calls, I have to admit. I called LEH long at around $18, which was the right call, but then called SKF long as well, which was the wrong call. We looked early as though they might sell the news on C. I made the mistake of thinking SKF might get pinned higher, which didn't happen, they basically pinned $135. My bad. Hey, it happens. We got MF and made some nice sheckels late day, though, so there ya go, and MF could get a nice gap up Monday if the market decides to stay a bit positive. Monday's open should be a nice fade either way. I think the Bulls and the Bears are lined up and are going to have a nice fight here. A lot of people were caught short, and a lot of funds came in with both fists buying, sending the market zooming. You'll notice what happened, the stuff that was and has been red HOT and the so-called safety stocks, like energy, AGs, and such all SOLD OFF HUGE (hence our USO puts being so steller!). Commodities are cracked here. There is definately a pairing in this market which is a good way to guage and profit from the market. Commodities up, financials and consumer staples down. Commodities down, reversal. Oil $150 was strong resistence, a lot of funds that were long unwound the position over $145. I'd like oil to pull back here as much as anyone, I think $125 looks to be the next level. This weekend if there is good news out of Rice's trip to Iran, and US policy looks to have short term solved that issue, oil SHOULD pull back in a big way and the markets could get a further boost UP.
I like that scenario, I think thats how it plays out, which is why I am backing off the idea of flat out shorting the market this instant. Let's wait and see how it pans out. For the moment, I think oil heads lower unless news overcomes that view. You can short oil futures, I did this week, with Terra Nova (http://www.terranovatrading.com/). That's who we recommend as a broke, and who I use. Tell them Trendfund.com sent you and they'll give you some nice discounts and some free trades I believe.
In the meantime, its a beautiful day in NYC and I intend to enjoy it! See ya all Monday!
happy trading!
RULE!
Waxie
Thursday, July 17, 2008
Rally time...
And then,,,,MSFT = miss...GOOG = miss...MER = miss.
Futures down pretty deeply.
Dudes, and dudesses. We've had a nice rally/short squeeze. Be very afraid here, I feel strongly that TECH is the next giant to get slayed and all this rally did was set it up so we can take the financials short again next week! This rally is going to peeter out fast, folks. I like the RUT.X puts again and think the Russell should see the other side of $600 before the next options expiration (August). Maybe, maybe not, but I like tech short. The short class will be set tomorrow as far as date.
I think this market is setting up for a pretty steep decline near term. MER earnings show that things are not any better. The SEC and FED propping things up can only last a short period of time.FNM and FRE will be ZERO, period. That's my take.
I'm probably going to short (yes, evil, I know) FNM and FRE tomorrow. They will probably pin $7.50 and $10.00 on them. Watch pin action tomorrow. I think GS several issues look good here, but will reserve that for another forum.
GOOG down $50s after hours, BIDU down 4+%, MER down big, IBM down even after blowing out. This is a BEAR market rally.
I also like WM puts, the Augusts as I think WM is the next to fail. We'll see soon enough, won't we?
See ya all manana!
RULE
Waxie
Futures down pretty deeply.
Dudes, and dudesses. We've had a nice rally/short squeeze. Be very afraid here, I feel strongly that TECH is the next giant to get slayed and all this rally did was set it up so we can take the financials short again next week! This rally is going to peeter out fast, folks. I like the RUT.X puts again and think the Russell should see the other side of $600 before the next options expiration (August). Maybe, maybe not, but I like tech short. The short class will be set tomorrow as far as date.
I think this market is setting up for a pretty steep decline near term. MER earnings show that things are not any better. The SEC and FED propping things up can only last a short period of time.FNM and FRE will be ZERO, period. That's my take.
I'm probably going to short (yes, evil, I know) FNM and FRE tomorrow. They will probably pin $7.50 and $10.00 on them. Watch pin action tomorrow. I think GS several issues look good here, but will reserve that for another forum.
GOOG down $50s after hours, BIDU down 4+%, MER down big, IBM down even after blowing out. This is a BEAR market rally.
I also like WM puts, the Augusts as I think WM is the next to fail. We'll see soon enough, won't we?
See ya all manana!
RULE
Waxie
Wednesday, July 16, 2008
Senator Jim Bunning...
Had to be a pitcher, right? OK< here is the exact quote, I was fairly close...and I agree, it is mindboggling how we continue to make the same mistakes over and over and over again and keep going back to the source that made the mistake asking them what we should do...
This is off Senator Bunning's webpage, fyi...
____________________________________________________
Third and finally, since I expect we will try to get right to questions in the next hearing, let me say a few words about the G.S.E. bailout plan. When I picked up my newspaper yesterday, I thought I woke up in France. But no, it turns out socialism is alive and well in America. The Treasury Secretary is asking for a blank check to buy as much Fannie and Freddie debt or equity as he wants. The Fed’s purchase of Bear Stearns’ assets was amateur socialism compared to this.
This is off Senator Bunning's webpage, fyi...
____________________________________________________
Third and finally, since I expect we will try to get right to questions in the next hearing, let me say a few words about the G.S.E. bailout plan. When I picked up my newspaper yesterday, I thought I woke up in France. But no, it turns out socialism is alive and well in America. The Treasury Secretary is asking for a blank check to buy as much Fannie and Freddie debt or equity as he wants. The Fed’s purchase of Bear Stearns’ assets was amateur socialism compared to this.
Turnaround Wednesday!
OK, so Wednesday the buying came in fast and furious and we got a VERY nice TREND UP day at last! That's what you call a very nice SHORT SQUEEZE!
The squeeze was incited by several factors;
1)We were/are severely oversold
2)The Fed is basically saying that they will buy the stock market to avoid it going down more
3)Wells Fargo had (expected) good results
#1 is really the main reason, but the Fed really is doing investors an injustice long term. They are setting up even larger losses. We're putting together a really good onlinse seminar on HUNTING FOR BEAR, how to trade and profit from a Bear market. I think it's gonna be a home run class for a lot of reasons. One of the things I've learned over the years is that trending markets (up or down) have many similarities to each other, and if you can pinpoint them you can make oogles of money!
Today's kind of rally is a typical oversold SNAP BACK rally into a Bear market downtrend.
These rallies tend to be VICIOUS, like today's where they crush anyone short. We got long several things, including FSLR and GOOG (Option Trader intraday had a better than 50% gain on the $520 GOOG calls! SWEET!). We were/are also short the USO, which you'll notice was one of the few things/sectors downon the day, so DOUBLE Ka-chingo!
The trick/key is not to be exact in your time, the key is to limit your losses if you are on the wrong side of the market and not get greedy. SKF, which we basically called around $125 went all the way to $200 yesterday. Today it was down 20%! You need to make sure you are taking profits as things go and so if you get stopped out of a position you don't give back much of your gains. The worst thing a trader can do, and I've done it myself, trust me, is to have a nice gain and turn it into a break even, small gain or the worst - a loser!
OK, so thats the trading piece of things, though I will say that a nice gap down would be a nice buy for at least a bounce to green. Right now the futures are down here, so hopefully they stay down for the open decently and we can fade them. Remember, GOOG reports after the close Thursday and that is going to be a KEY report for the market, particularly tech near term. I think they will beat and guide up nicely, they usually do. How much by will dictate what happens to this market near term in techland. I'm hoping its total blowout like last quarter and we can get GOOG to $600s! That'll set up some nice shorting opps in the next few weeks. This is why I wanted to wait to do the TOP TEN TECH SHORTS class. So, now we'll set it for mid next week, I'll announce the date by Friday more than likely. I didn't want to do the class before we saw some earnings. JPM in the am will get the financials in gear some more, or pull them back in a bit. The question is, did we mark a near term "bottom" or was this a one day wonder rally like we've had in this Bear market several times? I think we could get some sideways action, and maybe move toward 11,500 - 11,700, but I would not be that hungry to be long here for more than trades just yet. You see the problem with these types of rallies is, they happen so fast its hard to get in, and usually what happens in a Bear market is that people get in at the last minute, when the rally is all but over.
The Fed is basically making us a socialist country. It's funny, on Tuesday there was a senator who really went after Bernanke, I didn't catch his name, so someone please email me to let me know, but he had a great line, and I paraphrase "yesterday I went to bed at night and when I woke up I didn't realize I was in France, but I was" or something like that. He was saying (and said) that the actions of the Fed, and the govt. are tantamount to socialism. The government is not, and never should (and I don't think ever has) be buying up stock on the open market. That's absurd. And, it artifically creates an illusion of safety.
Why do I say that? Think about this, a couple of months ago when the Bear Stearns debacle happened a ton of analysts said you should buy LEH stock. The rationale? That the FED had put a "FLOOR" under the stock and it couldn't possibly fall any further than the roughly $25 to $30 it was then trading at. The stock went all the way to close to $50.
This week LEH traded in the $11s (yesterday). The Fed can do anything they want, they can pump money into the economy, they can say FNM and FRE are solvent, they can make anything they want up, but in the end there is a saying, you may have heard it - Water seeks its own level.
FNM and FRE are worthless. You know what the Fed should do? They should BUY OUT FNM and FRE at $25 a share each! You want to drive the market to 15,000 in a jiff? Have the Fed do that! Then everyone who is smart and short these crappy stocks will get crushed (I'm not currently short them, but am drooling at the notion they may go higher so then I can short them! - NOT naked though! Hehe). You would then have the basic setup that the Federal govt of this country has become the world's largest investor in the US stock market.
That's almost as smart as bailing out the housing crisis by rewarding people who bought things they couldn't afford. I've used this analogy before, I lost a LOT of money in several ventures. It sucks losing hard earned money. Why doesn't the Fed bail me out of those bad investments? What's the difference? There isn't any, but this is an election year and so as I've said also before, the perfect storm is brewing and in the end its gonna unfortunately be EXTREMELY ugly.
Oh, one more idea, why doesn't the Fed just print like 10 TRILLION dollars and send every American like $100,000 check? That'd be cool, and everyone would then go out and spend and that would, I think, jumpstart the economy! Why not? They will spend that much anyway with these ridiculous things they are doing now. Might as well just give everyone a nice big fat check - ka-chingo! I'd be happy to get $100,000 check! Sweet!
I actually heard today that there are politicians talking about how they should abolish short selling! ROFLMAO! Yes, the evil short sellers! My gawd, sometimes I watch these hearings during the day and I just want to shake my TV.
Listen, you may or may not agree with what I say, that's fine either way, this is a country built on ideas. But, trust me, NONE of this problem, and I do mean NONE of it, has anything to do with "short sellers". I short sell the market SOMETIMES, and I long it SOMETIMES. That's what good traders do. If the idea is that the market needs to go up always, that's not a market, thats another handout and it'll just devalue the dollar to nothing and then it won't matter, we'll all be using a well barrow to buy a loaf of bread.
This Fed is possibly worse than the last one. And one last rant (ok, maybe two!), what's TRULY scary is that many of the ideas that booyah head is coming up with, the Fed is doing! They all watch his show and then think he knows what to do!
Oy vey. Now we go back to the uptick rule. It's unreal. You can't stop the market ultimately from falling, I'm sorry. It won't work, all it'll do is it'll hurt even more investors. It won't hurt the dreaded and evil "short sellers' it'll hurt the average investor who will have a false sense of security, only to find out that the market will fall no matter what in the end. And, that's tragic, my friends. History is and should be a good guidepost. The best way for the market to find that elusive bottom for real? Let it fall til it finds it and then we can build from there. Right now there is this insane witch hunt for who's at fault, and the TRUTH is, when you point a finger at something, THREE FINGERS point back at YOU!
WATCH GOOG, and fade the gap today!
'Nuff said.
Evil doer out,
Waxie
The squeeze was incited by several factors;
1)We were/are severely oversold
2)The Fed is basically saying that they will buy the stock market to avoid it going down more
3)Wells Fargo had (expected) good results
#1 is really the main reason, but the Fed really is doing investors an injustice long term. They are setting up even larger losses. We're putting together a really good onlinse seminar on HUNTING FOR BEAR, how to trade and profit from a Bear market. I think it's gonna be a home run class for a lot of reasons. One of the things I've learned over the years is that trending markets (up or down) have many similarities to each other, and if you can pinpoint them you can make oogles of money!
Today's kind of rally is a typical oversold SNAP BACK rally into a Bear market downtrend.
These rallies tend to be VICIOUS, like today's where they crush anyone short. We got long several things, including FSLR and GOOG (Option Trader intraday had a better than 50% gain on the $520 GOOG calls! SWEET!). We were/are also short the USO, which you'll notice was one of the few things/sectors downon the day, so DOUBLE Ka-chingo!
The trick/key is not to be exact in your time, the key is to limit your losses if you are on the wrong side of the market and not get greedy. SKF, which we basically called around $125 went all the way to $200 yesterday. Today it was down 20%! You need to make sure you are taking profits as things go and so if you get stopped out of a position you don't give back much of your gains. The worst thing a trader can do, and I've done it myself, trust me, is to have a nice gain and turn it into a break even, small gain or the worst - a loser!
OK, so thats the trading piece of things, though I will say that a nice gap down would be a nice buy for at least a bounce to green. Right now the futures are down here, so hopefully they stay down for the open decently and we can fade them. Remember, GOOG reports after the close Thursday and that is going to be a KEY report for the market, particularly tech near term. I think they will beat and guide up nicely, they usually do. How much by will dictate what happens to this market near term in techland. I'm hoping its total blowout like last quarter and we can get GOOG to $600s! That'll set up some nice shorting opps in the next few weeks. This is why I wanted to wait to do the TOP TEN TECH SHORTS class. So, now we'll set it for mid next week, I'll announce the date by Friday more than likely. I didn't want to do the class before we saw some earnings. JPM in the am will get the financials in gear some more, or pull them back in a bit. The question is, did we mark a near term "bottom" or was this a one day wonder rally like we've had in this Bear market several times? I think we could get some sideways action, and maybe move toward 11,500 - 11,700, but I would not be that hungry to be long here for more than trades just yet. You see the problem with these types of rallies is, they happen so fast its hard to get in, and usually what happens in a Bear market is that people get in at the last minute, when the rally is all but over.
The Fed is basically making us a socialist country. It's funny, on Tuesday there was a senator who really went after Bernanke, I didn't catch his name, so someone please email me to let me know, but he had a great line, and I paraphrase "yesterday I went to bed at night and when I woke up I didn't realize I was in France, but I was" or something like that. He was saying (and said) that the actions of the Fed, and the govt. are tantamount to socialism. The government is not, and never should (and I don't think ever has) be buying up stock on the open market. That's absurd. And, it artifically creates an illusion of safety.
Why do I say that? Think about this, a couple of months ago when the Bear Stearns debacle happened a ton of analysts said you should buy LEH stock. The rationale? That the FED had put a "FLOOR" under the stock and it couldn't possibly fall any further than the roughly $25 to $30 it was then trading at. The stock went all the way to close to $50.
This week LEH traded in the $11s (yesterday). The Fed can do anything they want, they can pump money into the economy, they can say FNM and FRE are solvent, they can make anything they want up, but in the end there is a saying, you may have heard it - Water seeks its own level.
FNM and FRE are worthless. You know what the Fed should do? They should BUY OUT FNM and FRE at $25 a share each! You want to drive the market to 15,000 in a jiff? Have the Fed do that! Then everyone who is smart and short these crappy stocks will get crushed (I'm not currently short them, but am drooling at the notion they may go higher so then I can short them! - NOT naked though! Hehe). You would then have the basic setup that the Federal govt of this country has become the world's largest investor in the US stock market.
That's almost as smart as bailing out the housing crisis by rewarding people who bought things they couldn't afford. I've used this analogy before, I lost a LOT of money in several ventures. It sucks losing hard earned money. Why doesn't the Fed bail me out of those bad investments? What's the difference? There isn't any, but this is an election year and so as I've said also before, the perfect storm is brewing and in the end its gonna unfortunately be EXTREMELY ugly.
Oh, one more idea, why doesn't the Fed just print like 10 TRILLION dollars and send every American like $100,000 check? That'd be cool, and everyone would then go out and spend and that would, I think, jumpstart the economy! Why not? They will spend that much anyway with these ridiculous things they are doing now. Might as well just give everyone a nice big fat check - ka-chingo! I'd be happy to get $100,000 check! Sweet!
I actually heard today that there are politicians talking about how they should abolish short selling! ROFLMAO! Yes, the evil short sellers! My gawd, sometimes I watch these hearings during the day and I just want to shake my TV.
Listen, you may or may not agree with what I say, that's fine either way, this is a country built on ideas. But, trust me, NONE of this problem, and I do mean NONE of it, has anything to do with "short sellers". I short sell the market SOMETIMES, and I long it SOMETIMES. That's what good traders do. If the idea is that the market needs to go up always, that's not a market, thats another handout and it'll just devalue the dollar to nothing and then it won't matter, we'll all be using a well barrow to buy a loaf of bread.
This Fed is possibly worse than the last one. And one last rant (ok, maybe two!), what's TRULY scary is that many of the ideas that booyah head is coming up with, the Fed is doing! They all watch his show and then think he knows what to do!
Oy vey. Now we go back to the uptick rule. It's unreal. You can't stop the market ultimately from falling, I'm sorry. It won't work, all it'll do is it'll hurt even more investors. It won't hurt the dreaded and evil "short sellers' it'll hurt the average investor who will have a false sense of security, only to find out that the market will fall no matter what in the end. And, that's tragic, my friends. History is and should be a good guidepost. The best way for the market to find that elusive bottom for real? Let it fall til it finds it and then we can build from there. Right now there is this insane witch hunt for who's at fault, and the TRUTH is, when you point a finger at something, THREE FINGERS point back at YOU!
WATCH GOOG, and fade the gap today!
'Nuff said.
Evil doer out,
Waxie
Tuesday, July 15, 2008
Buying came in...
And then it went OUT!
Man, there just ain't any real buyers here - YET. I saw some signs of it during the day Tuesday, but it quickly faded. Despite the powers that be trying to "fix" the markets, in more ways than one, the market simply couldn't sustain the more than 200 pt rally off the days lows.
INTC reported after the close and beat. The stock gapped up and then faded it. Frankly, I think its meaningless. Whatever these companies do this quarter doesn't mean a thing, they will experience a major slowdown more than likely no matter what. Tech is the best short there is, and the SHORT TECH class I am going to set a date by Thursday. I think the class will be held this weekend or Monday or Tuesday next week. OUr clients are really doing well. We've been knocking it out of the ballpark lately. We caught GOOG for nearly $19 in a couple hours today. That's a pretty nice call, ya know?
We covered LM puts plus around $15 (entry was $2s) for better than a 500% winner! Option Trader is EN FUEGO!
Let's keep playing the way we have. I repeat - if you ain't shorting the banks, you wasting your money. Yes, at some point they will get a truly meaningful bounce, but I don't think it'll last #1 and I don't think it's worth trying to pick that exact spot.
In the meantime, the AS Game kept me up, I'm beat and I'll see ya on the other side!
WAXIE
Man, there just ain't any real buyers here - YET. I saw some signs of it during the day Tuesday, but it quickly faded. Despite the powers that be trying to "fix" the markets, in more ways than one, the market simply couldn't sustain the more than 200 pt rally off the days lows.
INTC reported after the close and beat. The stock gapped up and then faded it. Frankly, I think its meaningless. Whatever these companies do this quarter doesn't mean a thing, they will experience a major slowdown more than likely no matter what. Tech is the best short there is, and the SHORT TECH class I am going to set a date by Thursday. I think the class will be held this weekend or Monday or Tuesday next week. OUr clients are really doing well. We've been knocking it out of the ballpark lately. We caught GOOG for nearly $19 in a couple hours today. That's a pretty nice call, ya know?
We covered LM puts plus around $15 (entry was $2s) for better than a 500% winner! Option Trader is EN FUEGO!
Let's keep playing the way we have. I repeat - if you ain't shorting the banks, you wasting your money. Yes, at some point they will get a truly meaningful bounce, but I don't think it'll last #1 and I don't think it's worth trying to pick that exact spot.
In the meantime, the AS Game kept me up, I'm beat and I'll see ya on the other side!
WAXIE
Monday, July 14, 2008
Turnaround Tuesday?
Well, the question begs "how much worse can it get for financials?"
The simple answer is MUCH. Honestly, there is some gift money out there if you're willing to be an investor on the short side more than likely. I don't think some of these stocks can possibly survive. Next 3 days are KEY (I feel like I say that every week, jeez!) because of C, MER, and GOOG earnings. There are others like IBM and INTC, but for my money GOOG is really going to be the key for techs simply because of the bubble I believe exists in the momentum names of tech. We will hope GOOG says everything is wonderful and gets us going to the upside. That'll give us some nice entries on the short side, and a potential nice trade to the longside initially to boot! I have no real feel for how GOOG is gonna play out. I do know that when we do get a trend up day soon it should be a very nice trading day.
In the meantime, I think you need to be patient if you are wanting to jump in for a long trade here. I still think there is the potential for a very serious catastrophic financial event unlike anything we've seen before (how's that for dramatic!?). But, perhaps everything will be dandy and the Fed will fix it all. NOT. The fact that the market sold off the way it did even after the Fed intervened says a lot. Yeah, we didn't go down that much, but we were down better than 200 pts from the gap up at one point during the day. There are simply no real buyers here, and other than dead cat bounces it's unlikely to change UNLESS we get the GOOGlicious #s some people expect.
There are two sectors I am targeting for near term trades to the short side. I'll talk more about this either Friday or Sunday night or whenever the TECH SHORT class goes. I'm trying to time this as best I can. Obviously last list is sick good, and hopefully we can knock 'em dead with this one! Stay tuned!
Be safe, and don't have your money in the regional banks! :)
RULE!
Waxie
The simple answer is MUCH. Honestly, there is some gift money out there if you're willing to be an investor on the short side more than likely. I don't think some of these stocks can possibly survive. Next 3 days are KEY (I feel like I say that every week, jeez!) because of C, MER, and GOOG earnings. There are others like IBM and INTC, but for my money GOOG is really going to be the key for techs simply because of the bubble I believe exists in the momentum names of tech. We will hope GOOG says everything is wonderful and gets us going to the upside. That'll give us some nice entries on the short side, and a potential nice trade to the longside initially to boot! I have no real feel for how GOOG is gonna play out. I do know that when we do get a trend up day soon it should be a very nice trading day.
In the meantime, I think you need to be patient if you are wanting to jump in for a long trade here. I still think there is the potential for a very serious catastrophic financial event unlike anything we've seen before (how's that for dramatic!?). But, perhaps everything will be dandy and the Fed will fix it all. NOT. The fact that the market sold off the way it did even after the Fed intervened says a lot. Yeah, we didn't go down that much, but we were down better than 200 pts from the gap up at one point during the day. There are simply no real buyers here, and other than dead cat bounces it's unlikely to change UNLESS we get the GOOGlicious #s some people expect.
There are two sectors I am targeting for near term trades to the short side. I'll talk more about this either Friday or Sunday night or whenever the TECH SHORT class goes. I'm trying to time this as best I can. Obviously last list is sick good, and hopefully we can knock 'em dead with this one! Stay tuned!
Be safe, and don't have your money in the regional banks! :)
RULE!
Waxie
Sunday, July 13, 2008
FED does what we thought they would...
The Fed announced they are opening the windows to FNM and FRE today. This one was a gimme. They also announced they might buy into the companies. So, we are gapping up HUGE off this news. The news doesn't mean anything, other than a temporary relief rally in the markets, which is great. It's funny, I REALLY do hope I'm wrong about my doom and gloom scenario. Trust me, you guys and anyone we work with will make a lot more the higher we go. We make money either way, up or down, but more of you are comfortable going long than short, so its always in my best interest, and the economies, if the market goes UP, and not DOWN! But, I have to call it as I see it, and I think these bandaids just make it WORSE for investors, it gives them false hope that the daddy-Fed is going to save them. This is a total MIRROR of the markets in most Bear times, and if you look at comments and actions by the Fed from 2000 to the last bottom in 2003 you will see some very eery similarities in terms of the jargon being put forward, and the Fed's actions. The S & P are gapping up 15 points here, and the DOW over 100 points. Maybe it'll hold, this is an Options Expiration week and that often is a reversal week as funds and institutions balance out their positions. Plus, we have GOOG, MER, IBM, INTC, MSFT, C and other BIG earnings and any positive surprises very well may squeeze this market higher near term. That's why it always pays to TRADE 'em, and not marry 'em! In the end, though, the Fed can't keep doing anything other than propping the markets up and feeding false hope into a market that is on life support right now. Again, I hope I am WAY wrong, you can all say "Waxie sucks!" That'd be WONDERFUL, trust me, but I call 'em like I see 'em and I see this playing out very very poorly. BUT, we will get, at least, a nice bounce at the open MOnday! Peace out, Waxie
DO NOT READ IF YOU CAN'T HANDLE IT!
It's funny watching Booyah-head-boy on CNBC Friday saying that the selling in FNM and FRE is OVER! He said it 100 times, as though trying to convince himself it might/could be true.
FNM and FRE are DEAD. They are both worthless entities. If the FED didn't have so much riding on them they'd both be where Enron is. Frankly, the amount of fraud and abuse of power may rival that of Enron. The Fed and the powers that be are clueless. Booyah-head-boy had a MASTER PLAN that will "save the housing market and send FNM and FRE up $15!".
Yes, the Fed should take warrants in the companies. Ah-huh, and this guy has a show that people actually tune into!
Funny, and I say this knowing first hand how hard it is to call the market day to day, I don't envy that, I do it myself and no one can always be right, in fact there are times when you have to be WAY wrong. Its the nature of the beast, and you're only as good as your last call.
OK, with qualifications out of the way, let me be the first to remind anyone who cares that Booyah-head-boy is the same dude who devoted hours of air time saying that BEAR STEARNS (BSC) was an absolute steal at around $80-$90 AND that they would be BOUGHT OUT (go to Youtube and look up the clip, I believe it's on there) by someone.
Well, I must admit, he was right! BSC was bought out and taken over by someone!!!! At $2 a share, then finally $10 a share!
So, he was only $70 or $80 off the mark. FNM and FRE, frankly, are going to ZERO unless the government bails them out in a way that saves shareholders. That would possibly be the dumbest thing they have done yet. FNM and FRE are antiquated. They serve no viable purpose as a public entity, they never have. They are government backed entities, the fact that there is even talk of government entities is a socialist idea that counters the tenets of capitalism.
The reason why we have capital markets is so that the markets can trade FREELY. Some may not agree. There are a lot of reasons why people feel the government should bail out these public companies. The problem is, and this is solely my opinion, that the government is setting up a very dramatic unraveling of the ENTIRE banking system in this country. There, I said it. I believe there is a better than 60 to 70% change (I'm being generous) that the ENTIRE US BANKING system goes CAPUT within the next 12 to 18 months.
Now, I know I will get a bunch of emails saying that I'm nuts, that that could never happen, that how dare I be so Un-American! Well, I'm as blessed and happy about living in their wonderful country as anyone, but I have to speak what I believe to be true. I think there will be a "run" on the US banking system and it will shut the banks - ALL OF THEM - down for a short period until things get sorted out.
I would rather own just about any other currency right now than the US Dollar. That's a fact. the US Dollar can't help but go down and much of that has to do with Fed policy. It's a policy doomed to fail. You simply can not put bandaids on when your arm is severed. It won't work.
I don't know, I'm just a dude who was homeless and once thought that a leftover happy meal from a garbage can was a delicacy, but I saw this coming. A lot of smarter people than me saw this coming, yet no one did a thing about it. And now? Now a lot of the same people see what I see and yet again, no one is doing anything about it. We hear talk of another $50 BIL in "economic stimulus". Are you kidding me? Seriously, are they that dumb? The first $150 BIL didn't work worth anything, why would you keep doing what doesn't work? They first one was just a political ploy, the second will have even less/worse an effect. They could throw a TRILLION dollars at the problem, it will just make it worse.
Printing money just makes your money worth-LESS. It doesn't help anything, it just helps create the hyper inflation we are building toward.
Yes, I am the grim reaper, I know, and as I keep saying - I really do hope I am wrong. Unfortunately I don't think I am. Until something different is done to FIX the system, the system will keep chugging along with it's head in the sand until someone comes along and buries it. That's what is setting up.
The stock market? The stock market is going down folks, WAY WAY WAY down. The DOW should be MAXIMUM 7000s in a couple of years (or much sooner), the Nasdaq should be below 1200 in same time frame (I love the Nasdaq short longer term, LOVE).
Unfortunately I don't know how to fix anything, all I can do is watch and wonder and listen to these dudes and dudesses in government say the same thing every day, and then at some point come back and say something countering what they were saying like it was nothing.
I watched the congressional hearings on Friday. Or whatever that nonsense was. If you saw it you saw some congresswoman ask this question, and I paraphrase "who is going to reap the PROFITS on the mortgages from the COuntry Wide Financial (CFC) deal?"
I mean, I nearly puked from laughter. The profits? Does anyone think that BAC wants that deal to go through now? Thy would back out in ten seconds if they could. That deal isn't going to have any profits. BAC is one of the best shorts out there simply becuase of that purcahse. CFC has so many bad debts from what I see that there is the possibility that that deal could do severe damage to BAC itself.
We are still a country in denial. Until that denial is punctured and reality sets in we can't possibly have a true bottom from which to build upon for more than trading dead cat rallies.
I'm sorry, I prefaced this by warning you not to read this if you didn't want the truth, at least according to me. It's funny, I post on several other messages boards on the internet. I posted something early last week about how FNM was going below $10, or lower, when it was north of $15. There were people writing saying I'm crazy, that it can't happen and that FNM was a great buy.
I'm not always right, in fact as a trader I am OFTEN wrong. I say it all the time, you don't need to be right all the time, just more often than not. But anyone saying that the financials are a good buy here is off their rocker. If C isn't $5 or less this time next year I will enter the Nathan's Hot Dog eating contest and beat Joey Chestnut!
You may not think that's a big deal, but I haven't had a hot dog in literally 25 years, I hate Hot Dogs, they disgust me. I read what was in them as a teenager and I swore off them forever.
There hasn't been a capitulation. For those of you who were around the markets in 2000 to 2003 during the decline from 12,000s to 6000s on the DOW than you will remember EVERYONE called a bottom every week. All we heard about was how much money was on the sidelines and how this was a great buying opportunity.
I think TECH is the next to get CRUSHED. I think the AGs are sitting ducks and I think that eventually EVERYTHING in sight is going on a one way ticket to 50% off sticker prices.
We are in the EARLY stages of a long term BEAR MARKET. That means that you will basically be able to throw darts at the market to the short side and get it right. I have to keep saying it, I think TECH is VASTLY overpriced. People say "oh, but people will still buy I-Phones" . Of course they will, no one said Apple is going out of business, but their stock price is VASTLY overpriced. And, in the end, the BEAR gets ya! That's REALITY, if you can take it! Happy trading this week. We may get a bounce shortly, but it won't last that long until we get a REAL capitulatory move. I think S & P 1200 - 1210 is a given here, and DOW 10,500 area looks like a sure thing. We'll see soon enough! See ya on the other side, WAXIE P.S. I'm doing another SHORT SPECIAL class giving the TOP 10 TECHS to short NOW in the next 2 weeks, if you are interested email me at waxie@trendfund.com and/or look for the info on the site. Price will be about $129 and I'll give some option plays with the stocks as well. The last list has obviously ROCKED! I think this one will rock even better because these stocks are so VASTLY overpriced! Stay tuned!
FNM and FRE are DEAD. They are both worthless entities. If the FED didn't have so much riding on them they'd both be where Enron is. Frankly, the amount of fraud and abuse of power may rival that of Enron. The Fed and the powers that be are clueless. Booyah-head-boy had a MASTER PLAN that will "save the housing market and send FNM and FRE up $15!".
Yes, the Fed should take warrants in the companies. Ah-huh, and this guy has a show that people actually tune into!
Funny, and I say this knowing first hand how hard it is to call the market day to day, I don't envy that, I do it myself and no one can always be right, in fact there are times when you have to be WAY wrong. Its the nature of the beast, and you're only as good as your last call.
OK, with qualifications out of the way, let me be the first to remind anyone who cares that Booyah-head-boy is the same dude who devoted hours of air time saying that BEAR STEARNS (BSC) was an absolute steal at around $80-$90 AND that they would be BOUGHT OUT (go to Youtube and look up the clip, I believe it's on there) by someone.
Well, I must admit, he was right! BSC was bought out and taken over by someone!!!! At $2 a share, then finally $10 a share!
So, he was only $70 or $80 off the mark. FNM and FRE, frankly, are going to ZERO unless the government bails them out in a way that saves shareholders. That would possibly be the dumbest thing they have done yet. FNM and FRE are antiquated. They serve no viable purpose as a public entity, they never have. They are government backed entities, the fact that there is even talk of government entities is a socialist idea that counters the tenets of capitalism.
The reason why we have capital markets is so that the markets can trade FREELY. Some may not agree. There are a lot of reasons why people feel the government should bail out these public companies. The problem is, and this is solely my opinion, that the government is setting up a very dramatic unraveling of the ENTIRE banking system in this country. There, I said it. I believe there is a better than 60 to 70% change (I'm being generous) that the ENTIRE US BANKING system goes CAPUT within the next 12 to 18 months.
Now, I know I will get a bunch of emails saying that I'm nuts, that that could never happen, that how dare I be so Un-American! Well, I'm as blessed and happy about living in their wonderful country as anyone, but I have to speak what I believe to be true. I think there will be a "run" on the US banking system and it will shut the banks - ALL OF THEM - down for a short period until things get sorted out.
I would rather own just about any other currency right now than the US Dollar. That's a fact. the US Dollar can't help but go down and much of that has to do with Fed policy. It's a policy doomed to fail. You simply can not put bandaids on when your arm is severed. It won't work.
I don't know, I'm just a dude who was homeless and once thought that a leftover happy meal from a garbage can was a delicacy, but I saw this coming. A lot of smarter people than me saw this coming, yet no one did a thing about it. And now? Now a lot of the same people see what I see and yet again, no one is doing anything about it. We hear talk of another $50 BIL in "economic stimulus". Are you kidding me? Seriously, are they that dumb? The first $150 BIL didn't work worth anything, why would you keep doing what doesn't work? They first one was just a political ploy, the second will have even less/worse an effect. They could throw a TRILLION dollars at the problem, it will just make it worse.
Printing money just makes your money worth-LESS. It doesn't help anything, it just helps create the hyper inflation we are building toward.
Yes, I am the grim reaper, I know, and as I keep saying - I really do hope I am wrong. Unfortunately I don't think I am. Until something different is done to FIX the system, the system will keep chugging along with it's head in the sand until someone comes along and buries it. That's what is setting up.
The stock market? The stock market is going down folks, WAY WAY WAY down. The DOW should be MAXIMUM 7000s in a couple of years (or much sooner), the Nasdaq should be below 1200 in same time frame (I love the Nasdaq short longer term, LOVE).
Unfortunately I don't know how to fix anything, all I can do is watch and wonder and listen to these dudes and dudesses in government say the same thing every day, and then at some point come back and say something countering what they were saying like it was nothing.
I watched the congressional hearings on Friday. Or whatever that nonsense was. If you saw it you saw some congresswoman ask this question, and I paraphrase "who is going to reap the PROFITS on the mortgages from the COuntry Wide Financial (CFC) deal?"
I mean, I nearly puked from laughter. The profits? Does anyone think that BAC wants that deal to go through now? Thy would back out in ten seconds if they could. That deal isn't going to have any profits. BAC is one of the best shorts out there simply becuase of that purcahse. CFC has so many bad debts from what I see that there is the possibility that that deal could do severe damage to BAC itself.
We are still a country in denial. Until that denial is punctured and reality sets in we can't possibly have a true bottom from which to build upon for more than trading dead cat rallies.
I'm sorry, I prefaced this by warning you not to read this if you didn't want the truth, at least according to me. It's funny, I post on several other messages boards on the internet. I posted something early last week about how FNM was going below $10, or lower, when it was north of $15. There were people writing saying I'm crazy, that it can't happen and that FNM was a great buy.
I'm not always right, in fact as a trader I am OFTEN wrong. I say it all the time, you don't need to be right all the time, just more often than not. But anyone saying that the financials are a good buy here is off their rocker. If C isn't $5 or less this time next year I will enter the Nathan's Hot Dog eating contest and beat Joey Chestnut!
You may not think that's a big deal, but I haven't had a hot dog in literally 25 years, I hate Hot Dogs, they disgust me. I read what was in them as a teenager and I swore off them forever.
There hasn't been a capitulation. For those of you who were around the markets in 2000 to 2003 during the decline from 12,000s to 6000s on the DOW than you will remember EVERYONE called a bottom every week. All we heard about was how much money was on the sidelines and how this was a great buying opportunity.
I think TECH is the next to get CRUSHED. I think the AGs are sitting ducks and I think that eventually EVERYTHING in sight is going on a one way ticket to 50% off sticker prices.
We are in the EARLY stages of a long term BEAR MARKET. That means that you will basically be able to throw darts at the market to the short side and get it right. I have to keep saying it, I think TECH is VASTLY overpriced. People say "oh, but people will still buy I-Phones" . Of course they will, no one said Apple is going out of business, but their stock price is VASTLY overpriced. And, in the end, the BEAR gets ya! That's REALITY, if you can take it! Happy trading this week. We may get a bounce shortly, but it won't last that long until we get a REAL capitulatory move. I think S & P 1200 - 1210 is a given here, and DOW 10,500 area looks like a sure thing. We'll see soon enough! See ya on the other side, WAXIE P.S. I'm doing another SHORT SPECIAL class giving the TOP 10 TECHS to short NOW in the next 2 weeks, if you are interested email me at waxie@trendfund.com and/or look for the info on the site. Price will be about $129 and I'll give some option plays with the stocks as well. The last list has obviously ROCKED! I think this one will rock even better because these stocks are so VASTLY overpriced! Stay tuned!
Thursday, July 10, 2008
Rally time....?
OK, so FNM and FRE are heading to my target of under $1 in a hurry. LEH is in trouble, and oil ran up over $5!
BUT, the market rallied a wee bit nonetheless. I said it the other day, this is make or break time here. I think we should go a LOT lower near term, BUT watch GOOG here. They have earnings next week on the 17th and the stock could get a nice boost into it just based on them going up like 90 points after last quarters earning.
I'm not gonna write much here, I think the rally we got today and we might get Friday are based on very low volume and I think until we get a REAL washout day with SOME capitulatory action it's going to be very hard for us to get more than these dead cat type bounces.
Just stay limber and stay CASH rich. There is no reason to get into the market here other than for a trade, so heed that, or peril awaits!
See ya manana! Good trading!
WAXIE
BUT, the market rallied a wee bit nonetheless. I said it the other day, this is make or break time here. I think we should go a LOT lower near term, BUT watch GOOG here. They have earnings next week on the 17th and the stock could get a nice boost into it just based on them going up like 90 points after last quarters earning.
I'm not gonna write much here, I think the rally we got today and we might get Friday are based on very low volume and I think until we get a REAL washout day with SOME capitulatory action it's going to be very hard for us to get more than these dead cat type bounces.
Just stay limber and stay CASH rich. There is no reason to get into the market here other than for a trade, so heed that, or peril awaits!
See ya manana! Good trading!
WAXIE
Wednesday, July 09, 2008
NICE RALLY, FOLKS!
WOW, did you see that TWO DAY RALLY WE HAD!!!!?
No, neither did I! That's cause it didn't exist!
All that one day rally did was give shorts a better entry and now TECH is rolling over. I said it before and I'll say it again, AAPL, RIMM, GRMN, GOOG, etc. all going WAY WAY DOWN ultimately, timing is everything so we'll see when. I think AAPL may be shot here, but again let's see what shakes. THis is do or die near term. Either we retest and hold the recent lows, or if ER and ES bust below and can't bounce we should see 500s on the ER and 1100s on the S & P shortly. Stay tuned!
I do want to note that I gave you guys 1 stock yesterday LONG as a laggard - MELI. DId ya notice that in spite of the massive selloff MELI was up over $4! That's better than 15% in a day!
Who is your daddy?
FYI - I made a mistake, I meant 1300 last night on S & P, not 1400s. I don't think we see 1400s on S & P for a VERY long time, sorry to say. Folks, you must trade this market! If you are long you are WRONG and you will remain WRONG other than a dead cat bounce or two from here for a while. YES, we may get a decent bounce if we hold the lows, but that's all its gonna be. We need to find a TRUE solid base and I for one don't believe that's anywhere to be found until S & P 1000 or LOWER. S0, you want to stick in longs, be my guest but don't cry to me when you are dead broke! See ya in the am! FNM and FRE headed to my under $1 final targets. All these companies, and the Fed are just giving mixed messages. I believe the Fed is trying to make sure there is not mass panic in the markets BUT they want the market to go LOWER. Yes, I said it, call me nuts, won't be the first time or first ones, but I think the reason why yesterday you had Paulson saying "the housing market is stabilizing" and today other Fed speak countering that is very purposeful. The purpose? To make sure that the market's crashing doesn't happen all at once. They know its going to crash, they just don't want panic. Conspiracy? Nope, the Fed isn't in charge of the stock market's health, its in charge of the economies health. FNM and FRE can be .10 cents and still serve their purpose. The Fed proved with BSC that they don't care one bit about shareholders, nor should they. SO, you think we are at a bottom? GOod luck, Chuck, you will regret it. SELL YOUR STOCKS and start trading! Self serving? PErhaps, I want you all as clients for sure, but for a myriad of reasons. I want you all to start making money and not donating it to the short fund! See ya on the other side, WAXIE
No, neither did I! That's cause it didn't exist!
All that one day rally did was give shorts a better entry and now TECH is rolling over. I said it before and I'll say it again, AAPL, RIMM, GRMN, GOOG, etc. all going WAY WAY DOWN ultimately, timing is everything so we'll see when. I think AAPL may be shot here, but again let's see what shakes. THis is do or die near term. Either we retest and hold the recent lows, or if ER and ES bust below and can't bounce we should see 500s on the ER and 1100s on the S & P shortly. Stay tuned!
I do want to note that I gave you guys 1 stock yesterday LONG as a laggard - MELI. DId ya notice that in spite of the massive selloff MELI was up over $4! That's better than 15% in a day!
Who is your daddy?
FYI - I made a mistake, I meant 1300 last night on S & P, not 1400s. I don't think we see 1400s on S & P for a VERY long time, sorry to say. Folks, you must trade this market! If you are long you are WRONG and you will remain WRONG other than a dead cat bounce or two from here for a while. YES, we may get a decent bounce if we hold the lows, but that's all its gonna be. We need to find a TRUE solid base and I for one don't believe that's anywhere to be found until S & P 1000 or LOWER. S0, you want to stick in longs, be my guest but don't cry to me when you are dead broke! See ya in the am! FNM and FRE headed to my under $1 final targets. All these companies, and the Fed are just giving mixed messages. I believe the Fed is trying to make sure there is not mass panic in the markets BUT they want the market to go LOWER. Yes, I said it, call me nuts, won't be the first time or first ones, but I think the reason why yesterday you had Paulson saying "the housing market is stabilizing" and today other Fed speak countering that is very purposeful. The purpose? To make sure that the market's crashing doesn't happen all at once. They know its going to crash, they just don't want panic. Conspiracy? Nope, the Fed isn't in charge of the stock market's health, its in charge of the economies health. FNM and FRE can be .10 cents and still serve their purpose. The Fed proved with BSC that they don't care one bit about shareholders, nor should they. SO, you think we are at a bottom? GOod luck, Chuck, you will regret it. SELL YOUR STOCKS and start trading! Self serving? PErhaps, I want you all as clients for sure, but for a myriad of reasons. I want you all to start making money and not donating it to the short fund! See ya on the other side, WAXIE
Tuesday, July 08, 2008
BOUNCEY POO...
Well, we got the Turnaround Tuesday we thought we'd get! Ka-chingo!
Nice overnight gap down, then bounce, then drift, then BAMM! Some BS news from the BS Fed and wha-la - instant rally!
That's what you call a massively oversold rally! So, where to now? Well, hopefully we get a few more days of a rally. I missed one trade, I think someone pointed it out to me but I just plain missed it. AAPL into the news Friday of the new I Phone. That thing almost always rallies. My bias, which was right, kept me from calling AAPL long, but obviously that's been a nice trade into the news Friday. Usually that stock will sell the news, so it'll be interesting to see if AAPL sells off after Friday or Monday.
SO, ok, now back to the bounce notion and how long it'll possibly last. I think we have a shot to get a move to 700ish on the ER and potentially 1400 on the S & P. I don't think we can go much more than that. What you notice here is classic Window Dressing anti-trend. Oil tanking, commodities tanking, those stocks tanking and the beaten down sectors rocking. Usually this type of rally will last a few days to a week overall, with pullbacks buyable for that time period.
I do not see the financials getting very far here. I would love for some of these to get a 10% bounce. Get me to $40 on MER and I'll show you a really nice short entry. LM which has been STELLAR for us at $42 area would be very very nice to get a new short on. In this type of market we look to trade bounces to the long side and then look to short at resistence points. That gives us a very nice risk/reward situation, one that is easy to trade and manage as long as you are willing to set your stops.
I was asking on the blog yesterday about bounces and investing. Please note that I can't give individual advice to anyone, I'm not licensed or registered. I will say that me personally, I would NOT be investing in this market. I continue to believe that this market is VASTLY overvauled and these bounces are simply better short entries.
If you want to invest, after days like today just buy the SKF long (I would give it a little more room, perhaps it'll fall to $130 area which would be an ideal entry to the long side).
The ridiculous thing about the markets is, and why we can have a HUGE edge if we are patient is that they usually follow very clear patterns. Look at FNM and FRE today. If you've followed the markets lately you will know that the Fed has said similar things and sparked massive squeezes in MBI, ABK, WM, C and others over and over again. Yet, these stocks all have CRACKED HARD once everyone realizes that just because the Fed says some nonsense about how important FNM and FRE are, the Fed doesn't give a rat's butt about SHAREHOLDERS or the price of the stock. Just look at charts of MBI and ABK and compare them to the charts of FNM and FRE and you'll see a very real correlation. THese stocks are so so broken that they are doomed. Does that mean that FNM and FRE are going to go bankrupt? No, the Fed will bail them out more than likely, if they can, but do you think the Fed cares if FNM trades at $25 or $2.50? They don't, nor should they. FNM and FRE were set up to provide liquidity and stability to the markets they serve. TO use them as investment vehicles is not only foolish, but irrational. They should trade at roughly 5 to 10 X"s earnings AT MOST. When do you think FNM is going to earn enough to justify trading at the $18ish it closed today at? Not for a LONG while, if ever again.
Please remember ABK and MBI, part of being sucessful in the markets, or any business is to learn from history. These stocks kept getting propped up FALSELY and then they would just roll over again. The only ones making money on them? SHorts and TRADERS.
I do not believe rallies like today, other than they are a dead cat short covering. The media LOVES to say "the bottom". THe only thing that has a bottom here is my behind, which with my two a day workouts is getting a bit smaller. I know, TMI< but hey what can I do, you think it's easy to write every day and tell it like it is? I gotta put a little BUT(T) into it. Why? Cause everything AFTER BUT(T) is BS!
Or, so I'm told!
Let's see what shakes, but I suspect this bounce is fairly short lived. What I would look at here now is LAGGARDS. I have some on my list to call for members that I Think can get REALLY nice bounces short term. The usual trend on bounces like this is that they stall out and trade sideways before retreating and while trading sideways the stocks that lagged the initial move tend to get nice big fat moves. Watch stocks like MELI and some of the small cap solar stocks for that type of action.
'Nuff said! See ya in the am!
RULE!
Waxie
Nice overnight gap down, then bounce, then drift, then BAMM! Some BS news from the BS Fed and wha-la - instant rally!
That's what you call a massively oversold rally! So, where to now? Well, hopefully we get a few more days of a rally. I missed one trade, I think someone pointed it out to me but I just plain missed it. AAPL into the news Friday of the new I Phone. That thing almost always rallies. My bias, which was right, kept me from calling AAPL long, but obviously that's been a nice trade into the news Friday. Usually that stock will sell the news, so it'll be interesting to see if AAPL sells off after Friday or Monday.
SO, ok, now back to the bounce notion and how long it'll possibly last. I think we have a shot to get a move to 700ish on the ER and potentially 1400 on the S & P. I don't think we can go much more than that. What you notice here is classic Window Dressing anti-trend. Oil tanking, commodities tanking, those stocks tanking and the beaten down sectors rocking. Usually this type of rally will last a few days to a week overall, with pullbacks buyable for that time period.
I do not see the financials getting very far here. I would love for some of these to get a 10% bounce. Get me to $40 on MER and I'll show you a really nice short entry. LM which has been STELLAR for us at $42 area would be very very nice to get a new short on. In this type of market we look to trade bounces to the long side and then look to short at resistence points. That gives us a very nice risk/reward situation, one that is easy to trade and manage as long as you are willing to set your stops.
I was asking on the blog yesterday about bounces and investing. Please note that I can't give individual advice to anyone, I'm not licensed or registered. I will say that me personally, I would NOT be investing in this market. I continue to believe that this market is VASTLY overvauled and these bounces are simply better short entries.
If you want to invest, after days like today just buy the SKF long (I would give it a little more room, perhaps it'll fall to $130 area which would be an ideal entry to the long side).
The ridiculous thing about the markets is, and why we can have a HUGE edge if we are patient is that they usually follow very clear patterns. Look at FNM and FRE today. If you've followed the markets lately you will know that the Fed has said similar things and sparked massive squeezes in MBI, ABK, WM, C and others over and over again. Yet, these stocks all have CRACKED HARD once everyone realizes that just because the Fed says some nonsense about how important FNM and FRE are, the Fed doesn't give a rat's butt about SHAREHOLDERS or the price of the stock. Just look at charts of MBI and ABK and compare them to the charts of FNM and FRE and you'll see a very real correlation. THese stocks are so so broken that they are doomed. Does that mean that FNM and FRE are going to go bankrupt? No, the Fed will bail them out more than likely, if they can, but do you think the Fed cares if FNM trades at $25 or $2.50? They don't, nor should they. FNM and FRE were set up to provide liquidity and stability to the markets they serve. TO use them as investment vehicles is not only foolish, but irrational. They should trade at roughly 5 to 10 X"s earnings AT MOST. When do you think FNM is going to earn enough to justify trading at the $18ish it closed today at? Not for a LONG while, if ever again.
Please remember ABK and MBI, part of being sucessful in the markets, or any business is to learn from history. These stocks kept getting propped up FALSELY and then they would just roll over again. The only ones making money on them? SHorts and TRADERS.
I do not believe rallies like today, other than they are a dead cat short covering. The media LOVES to say "the bottom". THe only thing that has a bottom here is my behind, which with my two a day workouts is getting a bit smaller. I know, TMI< but hey what can I do, you think it's easy to write every day and tell it like it is? I gotta put a little BUT(T) into it. Why? Cause everything AFTER BUT(T) is BS!
Or, so I'm told!
Let's see what shakes, but I suspect this bounce is fairly short lived. What I would look at here now is LAGGARDS. I have some on my list to call for members that I Think can get REALLY nice bounces short term. The usual trend on bounces like this is that they stall out and trade sideways before retreating and while trading sideways the stocks that lagged the initial move tend to get nice big fat moves. Watch stocks like MELI and some of the small cap solar stocks for that type of action.
'Nuff said! See ya in the am!
RULE!
Waxie
Monday, July 07, 2008
WOWSA...
How bad are these financials? Jeez, louise! Well, don't say I didn't warn ya! Though, I must admit that I did think we'd at least get a bounce in them to start the new quarter. And, they did try, but they are just DEATH here. I still think they have to bounce, I mean they can't all go to zero,,,can they? Hehe!
FNM, FRE my two favorite financial shorts just CRUSHED! The people who played our short list are ROCKING to say the least. I mean ROCKING ROCKING ROCKING! As I write this S & P futures are down over 8 points again! This market is really in trouble folks. I think a gap down TODAY should get us some VERY nice bounce candidates. We tried to bounce late day Monday and I am thinking we get a dead cat short covering rally here today that could be nice. We'll see. A real nice capitulation would be super nice to wash us out and let us at least get some breathing room. You know what's really scary? I post on other sites my blog thread at times and I got booted from one the other day. Why? Because they said I was too NEGATIVE. Oy vey! That's why, my good friends, that investors are FOOLS. I'm sorry, I hate to grossly generalize, but why in the world wouldn't you want to hear the negative, even if you disagreed? It makes no sense, other than sticking your head in the sand and praying. And, while I believe in the spiritual power of prayer in many instances, I find it hard to imagine that anyone's idea of G-D would spend a lot of energy attending to prayer for stocks to go up! Ya know? Seems there are a few other more important things in the world to deal with then whether or not Citibank's stock has reached a bottom! It's really a shame, the US stock market is going to CRASH. I'm sorry, folks. I call it as I see it. It's going to be so bad that people are going to feel as though its the end of the world financially. As always, I preface it by saying I hope I am wrong, I truly do, but so far those of you who have been here listening to me/us at Trendfund.com prognosticate know that we/I have been DEAD ON, and that's no exageration or tooting of my own horn. I would rather be wrong and have people say I suck, its better for everyone if the market rallies, but this market is SHOT. Oh, we will bounce HEAVY shortly, perhaps very shortly, but the overall trend of this market is decidedly LOWER and MUCH MUCH lower in the end. Now, you can choose to heed that warning, as I have said again and again, or you can stick your head in the sand and say "he's just so negative! Why doesn't he do some Yoga!" Well, I do do Yoga, and I am VERY positive about most things in life, life is beautiful and wonderful and glorious. It's the stock market that sucks, dudes and dudesses, it's the stock market that sucks. Let's see what shakes here. If you are short, make sure your stops are set so when we do get a squeeze you lock in the gains and can reverse. Remember that Bear market bounces can be AWESOME to trade. Yes, we are and have been in a Bear Market for a while now. ANd, yes, we are and have been in a RECESSION for a long while now and will remain in one for at least 2 to 4 years, potentially 5 to 7 years. Sorry, I know, I am Mr.Negative. Perrhaps when we get a FED that actually knows what it's doing we can turn things around faster. Until then it's scary. And, for those that think that Oil prices are the root of all evil. As I've been saying and said on National TV, oil has virtually NOTHING to do with the stock market. Oil was down HUGE today and the market couldn't get out of it's own way. Amateurs point to oil as a cure all or damage all end all. It's simply not the case and hasn't been for YEARS. Reality is reality, everything else is just hope and in the stock market HOPE is a four letter word. Keep the faith, and trade 'em, don't marry 'em! WAXIE
FNM, FRE my two favorite financial shorts just CRUSHED! The people who played our short list are ROCKING to say the least. I mean ROCKING ROCKING ROCKING! As I write this S & P futures are down over 8 points again! This market is really in trouble folks. I think a gap down TODAY should get us some VERY nice bounce candidates. We tried to bounce late day Monday and I am thinking we get a dead cat short covering rally here today that could be nice. We'll see. A real nice capitulation would be super nice to wash us out and let us at least get some breathing room. You know what's really scary? I post on other sites my blog thread at times and I got booted from one the other day. Why? Because they said I was too NEGATIVE. Oy vey! That's why, my good friends, that investors are FOOLS. I'm sorry, I hate to grossly generalize, but why in the world wouldn't you want to hear the negative, even if you disagreed? It makes no sense, other than sticking your head in the sand and praying. And, while I believe in the spiritual power of prayer in many instances, I find it hard to imagine that anyone's idea of G-D would spend a lot of energy attending to prayer for stocks to go up! Ya know? Seems there are a few other more important things in the world to deal with then whether or not Citibank's stock has reached a bottom! It's really a shame, the US stock market is going to CRASH. I'm sorry, folks. I call it as I see it. It's going to be so bad that people are going to feel as though its the end of the world financially. As always, I preface it by saying I hope I am wrong, I truly do, but so far those of you who have been here listening to me/us at Trendfund.com prognosticate know that we/I have been DEAD ON, and that's no exageration or tooting of my own horn. I would rather be wrong and have people say I suck, its better for everyone if the market rallies, but this market is SHOT. Oh, we will bounce HEAVY shortly, perhaps very shortly, but the overall trend of this market is decidedly LOWER and MUCH MUCH lower in the end. Now, you can choose to heed that warning, as I have said again and again, or you can stick your head in the sand and say "he's just so negative! Why doesn't he do some Yoga!" Well, I do do Yoga, and I am VERY positive about most things in life, life is beautiful and wonderful and glorious. It's the stock market that sucks, dudes and dudesses, it's the stock market that sucks. Let's see what shakes here. If you are short, make sure your stops are set so when we do get a squeeze you lock in the gains and can reverse. Remember that Bear market bounces can be AWESOME to trade. Yes, we are and have been in a Bear Market for a while now. ANd, yes, we are and have been in a RECESSION for a long while now and will remain in one for at least 2 to 4 years, potentially 5 to 7 years. Sorry, I know, I am Mr.Negative. Perrhaps when we get a FED that actually knows what it's doing we can turn things around faster. Until then it's scary. And, for those that think that Oil prices are the root of all evil. As I've been saying and said on National TV, oil has virtually NOTHING to do with the stock market. Oil was down HUGE today and the market couldn't get out of it's own way. Amateurs point to oil as a cure all or damage all end all. It's simply not the case and hasn't been for YEARS. Reality is reality, everything else is just hope and in the stock market HOPE is a four letter word. Keep the faith, and trade 'em, don't marry 'em! WAXIE
Saturday, July 05, 2008
WINDOW WINDOW ON THE WALL, WHO HAS FALLEN ON THE FLOOR?
OK, so you can all see the power of Window Dressing now, right? I mean, it's no coincidence that all the stock (most) that were the hottest last quarter have cracked big time the 1st week of the new quarter. All you have to do is look at charts on X, POT, ENER, GDP, etc. etc. etc. and it's easy to see. And, while they haven't exactly lit the world on fire, the financial stocks have held up better than those.
So, where from here? Well, it'll be interesting. The financials should get a further bounce, but obviously that's a tough long to take and hold unless you have the strongest of stomachs. I suspect we get a REALLY nice bounce on the Solars and perhaps the Metals this week at some point. I have to check my earnings calander but I like GDP, and ENER still higher unless we tank harder overall. My suspicion is that we get a bounce first. WE just tested and breached the March lows on everything other than the Russell (how bout our Option Play of the Week Puts on that index! INSANE! Like a triple plus in a week! No biggie, only a 40 point drop for us! Ka-chingo!).
There's a TON of money to be made here folks, if you are just reading I suggest you get on board the Express train from Trendfund.com! Sign up for the Ninja service, or Swing Trader or Option Trader services, do yourself a HUGE favor! Now is not the time to sit back and complain, YOU have to get in the game!
In the meantime, the March lows either hold here or we'll see 10,500 area on the DOW in a jiff. IF we break below the March lows and can't reclaim them I would be looking to stay short and ride it down a bit. That would provide a nice risk/reward situation. But, like I said, I can see us bouncing a bit here before rolling back over. I still say we have to get much lower prices, but nothing goes in a straight line and we're traders so we play it both ways.
You saw the action in LEH last week, I just saw headlines today crossing Bloomberg that UBS says they don't need any more money and may even show a profit this quarter. That's why I think the financials should still get a hefty multi day bounce if no bad news comes early this week. If you want to play that then look at the indexes that cover them, BKX and the SKF ETF, or UGY I believe.
OK, more later, hope you are all enjoying your 4th of July weekend! I'll be posting all this week again, I hope, so try not to miss me too much!!!
And, remember - trade 'em, don't marry 'em!
My mantra!
RULE!
Michael "Waxie" Parness
So, where from here? Well, it'll be interesting. The financials should get a further bounce, but obviously that's a tough long to take and hold unless you have the strongest of stomachs. I suspect we get a REALLY nice bounce on the Solars and perhaps the Metals this week at some point. I have to check my earnings calander but I like GDP, and ENER still higher unless we tank harder overall. My suspicion is that we get a bounce first. WE just tested and breached the March lows on everything other than the Russell (how bout our Option Play of the Week Puts on that index! INSANE! Like a triple plus in a week! No biggie, only a 40 point drop for us! Ka-chingo!).
There's a TON of money to be made here folks, if you are just reading I suggest you get on board the Express train from Trendfund.com! Sign up for the Ninja service, or Swing Trader or Option Trader services, do yourself a HUGE favor! Now is not the time to sit back and complain, YOU have to get in the game!
In the meantime, the March lows either hold here or we'll see 10,500 area on the DOW in a jiff. IF we break below the March lows and can't reclaim them I would be looking to stay short and ride it down a bit. That would provide a nice risk/reward situation. But, like I said, I can see us bouncing a bit here before rolling back over. I still say we have to get much lower prices, but nothing goes in a straight line and we're traders so we play it both ways.
You saw the action in LEH last week, I just saw headlines today crossing Bloomberg that UBS says they don't need any more money and may even show a profit this quarter. That's why I think the financials should still get a hefty multi day bounce if no bad news comes early this week. If you want to play that then look at the indexes that cover them, BKX and the SKF ETF, or UGY I believe.
OK, more later, hope you are all enjoying your 4th of July weekend! I'll be posting all this week again, I hope, so try not to miss me too much!!!
And, remember - trade 'em, don't marry 'em!
My mantra!
RULE!
Michael "Waxie" Parness
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