question....

....The Dow sold off 777 points yesterday. Today the Dow gained 485 points. In other words, the Dow gained 37% of yesterday's losses today. So, can we assume that the sell off yesterday, after the official vote results were finalized, was so drastic because of stops below the market being hit, while intra-day traders piled on the snowball to the down-side? As we can recall, the markets gapped down yesterday and before the time the results of the bail-out bill were tallied the Dow was already down 300 points.
It could be assumed that if we got a YES vote on the bail-out the markets would have likely rallied, and possibly would have filled the opening morning's gap. So, what we witnessed yesterday can certainly be described as a number of different time frames being in the market at the same time; intra-day traders taking advantage of the volatility and swing and position traders (not to mention the robots) who were long, having their stops violated. Besides, there's a short-sell prohibition for 800 stocks as well.

Right?

crap day

title says it all. I lost $150 today (At least my USO position is back in the healthy green). Such a simple day to trade (QLD) in hindsight. A trend in place all day long with buys at one of the moving averages (I can't remember which one, I don't have the chart to post either...will look into that).
For the past few years I have always had this hunch that George W. Bush would orchestrate something to stay in office for another term. Wouldn't it be funny if this is the pre-cursor to that hypothesis?; Maybe he'll be running again in 4 years! w00t!

{Update} Here's the chart for QLD today. Such a simple strategy that I made more complex than it needed to be. Buy the longer-term Moving Average and let it walk up to the previous day's support level.

Patsy...I mean, Pelosi

"The Bill" was rejected 228 to 205. 95 Democrats voted, 133 Republicans voted.
"House GOP leader John Boehner said Speaker Pelosi’s floor speech before the vote “poisoned” the GOP caucus and cost as many as a dozen Republican votes that had previously been committed to the rescue plan. In her speech, Pelosi blamed America’s financial woes on eight years of the Bush administration’s “reckless economic policies.”
So, even if Pelosi's speech swayed a dozen Republicans to vote against the bill it still would have failed.
Post-vote comments include:
"Inaction has never been an option, but [Treasury chief Henry] Paulson’s plan should never have been our only option,” said Rep. Jeb Hensarling (R) of Texas...I fear that under this plan ultimately the federal government will become the guarantor of last resort, and that does put us on the slippery slope to socialism.”

"I’m resolute in my opposition,” said Rep. Darrell Issa (R) of California. “Today we are ending the Reagan era if we vote for this, and we can’t come back and fix it next year.”

“We could lose seats over this,” said Rep. Carolyn Maloney (D) of New York, who nonetheless voted for the plan."

"Rep. Emanuel Cleaver (D) of Missouri, a member of the House Finance Committee, delayed his vote until the last minute (can someone say "Pussy"!?) to see if GOP leaders could deliver a majority of their own caucus. They did not, and he voted against the bill. “There’s no reason for us to go in and bail Bush out if his own party rejects him,” he said."

well said

"...huge chunks of American voters no longer even demand that their candidates actually have policy positions; they simply consume them as media entertainment, rooting for or against them according to the reflexive prejudices of their demographic, as they would for reality-show contestants or sitcom characters."

Black Monday

wow

I lost $69 today. I'm really disappointed in my inability to buy/sell some of those capitulation moves today in QLD, AAPL, GLD, et al.
But really, WOW....Nasdaq down nearly 200 points! Amazing. Dow down 777!!! Mind-boggling. S&P down 106!! WOW.
We'll probably get a 1/2-point rate cut tomorrow and get a 1000 point run on the Dow, so no bigee, right?

ain't it so

Edison

"We are like tenant farmers chopping down the fence around our house for fuel when we should be using Natures inexhaustible sources of energy — sun, wind and tide...I'd put my money on the sun and solar energy. What a source of power! I hope we don't have to wait until oil and coal run out before we tackle that."
- In conversation with Henry Ford and Harvey Firestone.

"It is absurd to say our country can issue $30 million in bonds and not $30 million in currency. Both are promises to pay, but one promise fattens the userers and the other helps the people."
- Criticizing the Federal Reserve System

Other good ones can be found here.

out of the mouth's....

...of lipstick'd pit bulls....comments to make G.W. proud.

spend, spend, spend

I'm grateful to The Fly for bringing my attention to this guy on his site.

RIMM

RIMM down over 17% after hours. Net is up 72% but misses estimates.

Wolfe Wave

Ever heard of a Wolfe Wave? Check it out.

ummm errrr

"...and then obviously AIG came along, and ya know Lehman came along, and it was uh it declared bankruptcy. Then AIG came along and it uh..the house of cards was much bigger, and so when one card started to go we were worried about the whole deck going down."
Out of the mouth's of babes.

forclosed = felon

"James Carabelli, chairman of the Republican Party of Macomb County outside Detroit, said, "We will have a list of foreclosed homes and will make sure people aren't voting from those addresses,"
The Michigan GOP is apparently taking steps to prevent people who have had their homes foreclosed from voting. WTF!?
"the Democratic Party quickly filed lawsuits in federal court on behalf of three Michigan residents who lost their houses to foreclosure, to stop the Michigan GOP from carrying out what Democrats called an "ugly" and "horrific" plan. Michigan is a key swing state where a few thousands votes could determine who wins its seventeen Electoral College votes."
"Caging is a technique used to challenge voters by taking a list of addresses, mailing letters to them marked "do not forward" and then claiming that those voters whose letters were returned no longer live at the addresses at which they are registered and thus are ineligible to vote."

udderly disturbing

I probably shouldn't post this....but, reality can be pretty harsh so, grow a pair. I hope to god that there's a follow-up video 10 years from now.

if only

I'm sitting here watching/listening to the Senate hearings with Bernanke, Cox, Paulson....it's such fluff. Do you think the senate will actually reject this $700-billion proposal? If it is rejected I think I will actually vote in November for the party with the most no votes.
I wish these meetings could go more like this....

gay

I just tried to short USO at $86.50 (I'm still holding USO long in my swing account). Order Rejected under terms of Reg SHO Threshold Security. How gay is that! I guess I could have went long DUG.

technical...

...difficulties...Tradestation not working for me today. A very blah day today.

question...

Who's our other option for the presidential election? Is it Nader again? Is it legitimate to write in Ron Paul? This two-party system is bullshit (in my opinion). Our political system is like watching a divorced couple bicker over who loves their kids more.

seven hundy

"The recovery package cannot go higher than $700 billion without additional legislation. As for that figure, it lies between the optimistic estimate of $500 billion and the pessimistic guess of $1 trillion about the cost of fixing the financial mess. But the $700 billion is in addition to an $85 billion agreement on a bailout of the insurance giant American International Group, plus $29 billion in support that the government pledged in the marriage of Bear Sterns and JP Morgan Chase. On top of all that, the Congressional Budget Office says the federal bailout of the mortgage finance companies Fannie Mae and Freddie Mac could cost $25 billion." = $839-billion.

Kevin Phillips

He saw this mess coming a mile away. His book, Bad Money, is a great read. From his book:
"...between 2001 and 2006, an unprecedented number of Americans used their homes as ATMs, turning huge chunks of residential equity into borrowed, but spendable, cash."
"...over the past five years, the value of U.S. home mortgage debt has increased by nearly $3-trillion. In 2004 alone, it increased by almost $1-trillion. Net mortgage borrowing that year not used for the purchase of new homes amounted to nearly $600-billion, or almost 7% of disposable personal income...indeed, over five years, the housing sector seems to have provided some 40% of the growth in U.S. GDP, and employment, representing stimulus on a grand, almost 1930s scale."

In 1950 the manufacturing sector represented 29.3% of U.S. GDP, while Financial Services represented 10.9%. In 2005 Manufacturing represented 12% and Financial Services 20.4% of U.S. GDP. Imagine how things would be if the government didn't step in to help in the recent bail-outs; 20% of GDP!!

"Shrewd cabinet members and elected officials also preferred a less revealing GDP figure. New York City mayor Michael Bloomberg and Senator Charles Schumer, in releasing an in-depth portrait of New York finance in 2007, described the national financial services sector as just 8 percent of GDP by using an outdated definition that excluded mortgage lending and real estate operations." (emphasis added)

RL

I'm holding one issue (USO +9.36%) over the weekend and that's it. Provided the markets don't melt on Monday I've got my eye on a few candidates. I'll post some charts this weekend. I'm kinda liking RL here, it looks to have solid support at $70. Let me know what you think.

update

So, as the news goes, the limit on short selling includes only 799 financial companies. Here's the list.
I have to hand it to THE Fly once again. When news of the short sale rule was first being floated he reversed ship and (among other re-shuffling) bought a boatload of C ("more than 100,000"). If he took some off the table at the open he was looking at a 22% gain. Not sure what he did at the open, but it's food for thought on how not to behave in this sort of environment. A lot can be said for someone who can reverse their opinion on a market and follow suit with their money to back it up. One can't hold too sternly to a directional bias in these markets; and when news comes out you have to act in an unbiased manner to protect and grow your bottom line. Live and Learn.

On a side note. The easy money today was made shorting the vast gap at the open. Not that I made the easy money, but it's good to preserve these tidbits of information for future reference.

BUY, BUY, BUY!!!

It is being reported that the SEC has temporarily banned short-selling. Of course the headline begs more questions than gives answers. But I'm led to assume that this means ALL short-selling, of ALL stocks EVERYWHERE! WTF!?!?! So does this mean we just buy every stock (especially the financial sector) we can get our hands on? Won't this rule hyperinflate the value of most stocks? Like I said, WTF?!

perfectly said

"If you're not RIGHT THERE, stuck in the exact mood of the market, then you're really not able to do your job correctly. You have to feel extreme fear and you have to experience extreme greed.
Why? Because if you don't experience and feel it, you won't know it when you see it. Today we saw extreme fear. The flipside of panic selling, is always panic buying."
-DT

i have no idea what to do

I missed everything today. I missed the rally fade, missed the short squeeze, missed the fire-sale rally. I just sat by and watched it all take place. My hesitation on a number of issues proved to be very detrimental to the profit potential after the fact.
I did long a bit of AAPL at $126.45. Still holding my USO. Apparently tomorrow is Quadruple witching, so I'll be twice as clueless as to what to do.

Check out LVS; double bottom? Pending a drunken debauchery rally from here of course.

Beer

The (not so) old lady and I are brewing up some beer this afternoon. We got a recipe for Beamish Irish stout that we're making. It will be the perfect weather for it once it's ready to drink in about 3 months.
Can't wait!

USO

Sold my NOV this morning at $55.42. I know I mentioned yesterday I bought it as a swing trade, but I don't think I have the swing trade mentality in this sort of market. So, I took the money and ran.
I bought USO this morning at $75.20, will give holding considerations day-to-day (but it looks good from here). Also made a scalp trade long in NOV this afternoon for a small gain.

GOLD!

Gold is currently up $67!!!
Here's a daily chart of GLD

cool graphic

check out the Wall Street meltdown graphic at the NY Times.

THE fly

"With my money, I am shorting more GS. It’s going to book value ($99)."
GS currently at $102...down $30+.
Say what you will, he understands what's going on in these markets.

charge it!

The tab for all this bail-out mess is running upwards of $900-billion and counting. Would we have seen the same results back in the '80's?
Meanwhile, the Treasury is selling debt to raise cash for the Fed!

fiyah buhn

S&P50%

The S&P500 has retraced 50% from the 2002 lows. A big level of support. Is this the bounce inflection point? Or will support flip to resistance? Check out the analysis.

sim

I traded the Fed announcement today while in sim-mode; trading QLD, SKF, and SRS. After about 10-minutes I was trounced to a negative $680. I focused on SKF after closing out the other two and scalped my way back to +$50 for the day. There really is a lot more to just sticking to the addage of "Don't revenge trade," "Don't over-trade," "Stick to your plan," etc., etc..
The individual trader really has to have an internal fundamental understanding of what these addages mean before getting into the thick of things. It's so easy to treat this system like an arcade game, just clicking away thinking you'll work your way out of the hole you dug yourself into, as well as convincing yourself that you are correct in your opinion.
SIM-mode can certainly help with perhaps getting a pulse on a fast-moving stock, but it's not exactly an accurate depiction of how things might turn out if you were trading with your own money; both in how your orders will route, as well as how your mental edge will hold up.
So, my lessons learned for today are:
1). Sim-mode rules! It can be fun, AND it can teach you some valuable lessons if you follow through with a mental review your performance.
2). I don't trade fed-day with real money for a reason! Just when you think you have a lock on the tape, you can easily get completely spun around and tumble in the opposite direction.
On a positive note; I bought (NOT in SIM-mode) some NOV this morning at $49.50 as a swing trade. It just looked very Oversold to me and seemed to have found strong demand after testing the March lows. It currently looks strong; closing at the highs of the day with strong volume, could see some continuation tomorrow morning.

shenanigans

wow

DJIA down 504 points at 1:10p.m. It will be interesting to see how the Fed responds tomorrow afternoon.

The Other Shoe Drops

GS being sold off hitting prices not seen since January of '06. When these levels were seen in March it proved to be a good time to buy the stock. It looks like a different story this time around. Earnings come out tomorrow.

your kicks

Discovered a cool site this weekend. Design your own Converse sneakers. They have a pretty reasonable variety to make your sneakers your own.

chop

A really boring and frustrating market today. The only observation/lesson-learned I have from today is from watching TLT with QLD and the NYSE TICK.
The QLD filled the gap from this morning after 11:00a.m. If you weren't lulled to sleep before then you could have gone long at the apex of the ascending triangle (cup w.handle on shorter time frame) that formed in the first 1.5 hours with a traget of the gap-fill/previous day's high. Also up, I have a 1-min chart w.volume running of TLT (inverse relationship to QLD). Volume jumped at 12:33 this afternoon.Which coincided with this chart on a 3-min of QLD. Price tested the morning lows, rounded out before testing the highs again.
The whole time the NYSE TICK chopped between +/-400.

Railroads

Big day for Railroad stocks today. All the ones I'm looking at are turning up from Oversold levels, take your pick. BNIClosed at the high of the day with huge volumeNSC - back above the gap from July at $67.50. UNP - Back above $77.CSX- .

9/11/2001

I am thankful that my United flight out of EWR to SFO was scheduled for 7:39 P.M. instead of 7:39A.M. on that Tuesday.
Why are we in Iraq again?

USSRA

This article comes compliments of THE Fly's site and his cutting edge awareness. I feel we are helpless to do anything about this, but it's fascinating nonetheless. We all know the next presidential administration is going to inherit a shitstorm, so I think I'll be enacting the Costanza-vote this November; voting for the opposite party that I might otherwise vote for.
From the recommended article:
"This biggest bailout and nationalization in human history comes from the most fanatically and ideologically zealot free-market laissez-faire administration in US history. These are the folks who for years spewed the rhetoric of free markets and cutting down government intervention in economic affairs. But they were so fanatically ideological about free markets that they did not realize that financial and other markets without proper rules, supervision and regulation are like a jungle where greed – untempered by fear of loss or of punishment – leads to credit bubbles and asset bubbles and manias and eventual bust and panics."

Bounce? Slide?

Is this chart due for a bounce or downward spiral? QLD- UltraQQQProShares ETF nearing all-time lows since the ETF began in 2006.
The chart for the Nasdaq Composite Index is very similar, of course. If we don't get a bounce here soon, it looks like we could get a blow-off move to the downside. Though one blow-off move could likely trigger a lot of stops into the arena and create a steeper slide. Anyway, the QLD is heavily weighted in Nasdaq100 contracts as well as 11+% in AAPL shares (heavily weighted towards the Hardware sector).
At this point price direction seems like it will be knee-jerk whichever way it takes. Volume has tapered off of the current move down (which doesn't mean it can't skyrocket once extreme levels are hit. Also, the intra-day direction today seemed very indecisive/unconvincing. So...bounce? ...or, trigger all those stop-loss orders at the March lows? Anyway, it's important not to have a directional bias, rather be prepared for what ever direction you're faced with.
Here's the Nasdaq Composite Index daily chart.

Palin Action Hero

Gotta hand it to the creators of this action figure, they sure acted quickly.

die already!

The NYSE Cumulative TICK spent most of the day in negative territory today. Stubbornly price was being bought at support levels most of the day. Eventually we got a sweeping move down, the DJIA barely closing yesterday's gap.
I defer the discovery of all meaning behind this week's price action in the markets to here,
or here.
Oh yeah, I sold my position in NWL for a slight gain. Hindsight would have seen me closing out at the top of the morning, but it didn't happen until mid-day.
I missed trades in QLD as my bids weren't hit on my entries. blah!

Out of...

...the mouth's of babes:
"The nationalization of Fannie Mae and Freddie Mac shows that the U.S. is "more communist than China right now" but its brand of socialism is meant only for the rich, investor Jim Rogers, CEO of Rogers Holdings, told CNBC Europe on Monday.

"America is more communist than China is right now. You can see that this is welfare of the rich, it is socialism for the rich… it's just bailing out financial institutions," Rogers said."

The Man

I know they're old clips, but more relevant now than ever.

weird

Started the day with the DJIA gapping up 300+ points on the FRE/FNM bail-out news. If you were smart you would have likely gotten short within the first half-hour and covered at the double-bottom later in the afternoon. I watched DIA most of the day. A few scalping opportunities, most of the downside and attempts at a gap-fill were bought up pretty quickly. The DJIA daily chart recovered it's bullish-biased trendline that was broken on Thursday; Pull-back before continuing down? Short-Covering? Bullish recovery? I bought some NWL on Friday, it's looking pretty nice, with a strong day today but approaching some resistance, so I'm curious to see how it will react at $21.I'm sure you're all aware of the UAUA bankruptcy rumors that turned out being false. Insane tape on this one......oh yeah, GOOG...ouch!

Big Bang part deux

The Large Hadron Collider is finally ready to be switched on come next week. The gigantic particle accelerator found underneath Switzerland will shoot protons around a 17-mile long ring, allowing them to smash together in order to study the effects and in hopes of finding the elusive "God Particle."
Of course there are concerns that the experiment will both not recreate the effects they're looking for, and quite possible create a black hole out of the world as we know it. Yesterday's press release was a means of assuring us there will be know black hole come the end of this month.

What Can I Say....

...I got nothin' again. For some reason I have been completely unsure of what direction to trade. Either I'm too late coming into a trade and therefore don't want to chase it, or my confidence ahead of a move doesn't allow me to jump in. So, I'm in the process of regrouping. I like the chart on NWL for what it's worth (bull flag after a V-bottom, and they're in the process of cutting jobs).

consistency

...

We closed at the lows of the day. I've got nothin'.

SRS

UltraShort Real Estate Pro Shares SRS: The overall trend is down, so the plan is to short a retracement. Here you can see how things set up on the 3-min. chart today. There was a head-fake coming out of the consolidating triangle which tripped me up, but it made the measured move (and then some) afterwards.

sell it!

It looks like there was a type-o in the memo that went around Wall st. this morning. The memo probably read something like "...today we're going to have a stupendously bullish rally."
Then, just before lunch, everyone heard that the memo was supposed to read, "...today we're going to have a stupid bullshit rally." What it left us with was a massive sell-off and gap-fills across the boards. Seriously though, that was a pretty spectacular sell-off. From what I was watching the Russell2000 (IWM) and the S & P led the way down this morning, while the Dow put up quite a struggle to stay afloat.
Whatever chart you look at (of the indices) the line is drawn in the sand. We finally saw a volume surge today with very bearish undertones. We could either fall off the edge tomorrow, or get some choppy indecision. Get ready for some volatility to start off Q4.

mmmmOil

OIL! huh...What is it good for?...absolutely Everything!

Oil, Gas, Gustav

Have a look through this comprehensive site on potential damage to the Oil & Gas infrastructure in the path of Hurricane Gustav.

links

Link-fest