Thursday, June 10, 2010
6/11/10 Won't Get Fooled Again
There's nothing in the street
Looks any different to me
And the slogans are replaced, by-the-bye
And the parting on the left
Is now the parting on the right
And the beards have all grown longer overnight
I'll tip my hat to the new constitution
Take a bow for the new revolution
Smile and grin at the change all around me
Pick up my guitar and play
Just like yesterday
Then I'll get on my knees and pray
We don't get fooled again
Don't get fooled again
No, no!
Meet the new boss
Same as the old boss
Congrats to tof, who faded my call for Black ---(-)-)-)day all week.
Fooled again? Every ----ing day.
Let me recount one successful trade, despite the fact that I cleared less than $20-
ERY started dropping in the final hour. I decided to watch it for a possible trade, as it certainly felt like capitulation on the part of (energy) bears. My mantra was wait- wait for the 'hop, skip, and a jump' in price declines before even thinking about opening a position. I watched the price stall around 11.05. Then 11.01. 10.98. Hop to 10.92- wait for the skip. Skip to 10.88. Wait for the jump. Jump to 11.7x. Hit the buy button for 1000 shares @ market, which filled at 11.78. Sold after hours @ 11.80. Was it worth it? Hell, yes! Price action unfolded exactly as predicted, and the experience will continue to inform future trades on the ultras. In other words, I got it right!
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TK-
ReplyDeleteThe Bulls Get Off the Mat
Well, it was a rough day in Tim-land! I came into the day totally short, and the only bright spots for me were some bullish day-trades in BGU, DIA, and SPY as well as the successful close of my SLV short. Otherwise, I got beat up pretty badly, particularly since there was so much strength in the energy sector.
The next line in the sand above for the /ES is 1090. After that, it's 1108. If the /ES pushes above 1108, that would be pretty impressive, since the two attempts before failed. Finally, there is 1147.50 and, the ultimate line, 1174.75.
So all this chatter I read about how bearish today was going to be was clearly dead wrong. Let's see what Friday has in store for us. There's no doubt that a day like today is going to hearten the bulls, particularly those looking at such battered bargains as BP and RIG, each of which had amazing days.
Why am I not holding ERY overnight? B/c I tend to agree with Pat's closing report- that there may be more pain in store for trapped bears before the market pulls back. No worries either way. I can honestly say my confidence, both in terms of capital preservation and in terms of being able to 'count on myself' to do the right thing, has shot up over the past year.
ReplyDeleteThrowing back another tumbler of Nadurra in honor of tof.
ReplyDeleteIt wasn't looking good last night, man. But you definitely cleaned up today. Hope it spikes again in the morning before I have to start betting the other way ;)
2nd, My belief is the English pound is on it's way down and then finally, the U$D after that.
ReplyDeleteWe'll have to wait on the G-20 meeting (6/25) to see what really happens, it could change things or perhaps accelerate them...
Is England buying PM's meanwhile, or will a PM downtrend emerge as flight to risk comes back in vogue?
I feel we just witnessed or are very near an equities bottom and oilers are under rally mode.
LONDON, June 10 (Reuters) - A European Central Bank decision
ReplyDeleteto extend fixed rate three-month liquidity operations until
September could help reduce money market tensions and prolong
lower EONIA and Euribor rates, analysts said on Thursday.
Speaking at a news conference after the ECB left its key
policy rate unchanged at 1.0 percent, as expected, the central
bank's president, Jean-Claude Trichet, said a further three
operations in three-month liquidity would be conducted through
to Sept. 29. [ID:nWEA5693]
Trichet also said the ECB's bond-buying of riskier
euro zone debt would continue.
The overnight EONIA rate EONIA= fixed at 0.332 percent -
barely changed from levels seen since July 2009. [ID:nLDE6381Q1]
The ECB introduced six- and 12-month liquidity operations
during the financial crisis to help banks gain access to money
and ensure credit kept flowing.
It started to phase out additional stimulus measures late
last year, but has since reinstated some of them as the
sovereign debt crisis has made banks hoard cash again.
But a question mark has been hanging over what would happen
to liquidity conditions when the current 442 billion euros
12-month Long-Term Refinancing Operation expires on July 1.
"Trichet's offer makes more readily available liquidity from
the ECB, aiding the transition out of 12-month money into
shorter tenors when the current 12-month LTRO ends," said Peter
Chatwell, a market analyst at Credit Agricole in London.
This tonic to money markets was expected to arrest recently
widening London Interbank Offered Rates over OIS rates, the
three-month premium paid over anticipated central bank rates.
"This will bring the Libor-OIS spread lower for the time
being, as the market can now get access to unlimited three-month
funds at a fixed rate until Sept. 29 at least, which should
reduce counterparty risks and postpone any exit strategies the
ECB might want to implement," he added.
September Euribor futures FEIU0 turned positive, pulling
implied rates lower.
"The monthly 3-month operations in the third quarter...will
limit upside pressures on Euribor (rates) stemming from the
expiration of the ECB's 12-month loans in July," said Lena
Komileva, head of G7 market economics at Tullett Prebon in
London.
"However the rise in Euribor has been related to credit risk
concerns, rather than to lack of ECB liquidity in the markets,
so implications for the market are relatively limited."
Some analysts had expected any extension of liquidity to be
in the six-month operations.
"This new liquidity will mean that Eonia rates stay lower
for longer and especially the market tensions could now be
contained," said Benjamin Schroeder, money market analyst at
Commerzbank in Frankfurt.
LIBOR/OIS
Before the ECB announced steady interest rates, the
six-month euro-priced interbank lending rate climbed above the
central bank's benchmark rate for the first time in seven months
as market tensions put pressure on borrowing costs.
[ID:nEAP000459]
Also before the ECB's announcement, euro Libor was fixed at
0.65438 percent in London, up slightly from 0.65250 percent a
day earlier EUR3MFSR=. The Libor/OIS spread was unchanged at
23 basis points. [ID:nEAP000031]
TOF- Looks like we are in the same boat. My SSO should go positive about SPX 1100. I've kinda convinced myself to let this ride in my IRA since it is a small position, 2,000 shares, and will get shut out for 3 days if I close it. Right now down 3.90%.
ReplyDeleteMark, they have a lot of red lake property, and on it is F2. most holes drilled come up with at least some gold, and sometimes its very high grade. The guess would be they need to dilute again to build the mine. I used to have 400k of it bought sub $1 avg, and sold out around $2. I too, think there is potential that a bottom is being formed. I watched it all day today, and they are playing the "scary ask" game to hold down the price and accumulate, IMO. Of course its possible gold gets killed and the shares go to 70 cents again...
ReplyDeleteYo Cheapy, your the man. Thanks. I've been reading as much as I can right now on it. I also bought my first CL futures contract @ 75.10. Stop at 74.60. New area for me, so I'm being careful.
ReplyDeleteRetail 'sales' taking the 'sail' out of this rally.
ReplyDeleteOf course, it's all relative. DJIA giving back all of 60 points of yesterday's 273 point rally.
ReplyDeleteEuropean bourses sink like lead weights.
ReplyDeleteNow it's -100 on the DJIA. Question is- do you buy or short this dip?
ReplyDeleteLandry-
ReplyDeleteRandom Thoughts:
Dave Landry's 10 Best Patterns & Strategies is available at:
www.davelandry.com/books.htm
A painful day to be short, but that's what you should be in this market.
So far, the market only appears to be bouncing from oversold in what appears to be a covering type of move.
Futures were firm but have weakened considerably. So, we could see resumption of the downtrend sooner rather than later.
Honor your stops on existing shorts and wait for entries on new ones. If we do get follow through, use this as an opportunity to scale and trail on existing positions.
Their saying PXP is an interesting valuation play on CNBC.
ReplyDeleteThat's the question isn't it 2nd? Have we switched to buying the dips?
ReplyDeleteX is strong so far.
PXP - Look at it go! Sell BP, buy PXP?!?!?
ReplyDeleteSo far it's buy the dip.
ReplyDeleteCP- I'd hold off on PXP here.
Sold last 1/3 of SD @ 6.66.
ReplyDeleteX - If China shuts down steel production like they say they're doing (too much capacity and they're boycotting ore price hikes), that might help X somewhat?
ReplyDeleteAlso, there are pressures to place tariffs on Chinese drill pipe.
R1 for PAL today is????...You guessed it. 3.28.
ReplyDeleteMark - I'm waiting for the close before making any buying decisions unless maybe we lose 1000pts...
ReplyDeleteYou seem kinda bearish on oilers, what's up with that?
VIX below 30.
ReplyDeleteWhat is this R1 indicator you speak of?
ReplyDeleteCP- I'm looking to the close also, but now we're already green.
ReplyDeleteI'm not bearish on the energy plays at all. Hopefully I'm doing the prudent thing buy taking profits, and will find a better entry point in the near future. Although with PXP it looks like I'll have to pay a higher price.
CP- Pivot points. R1= First resistance. Did I ever post the formula I use for you? I remember you asked me too.
ReplyDeleteHey guys,
ReplyDeleteStill in PAL out of RBY...
I thought about it and realized basically RBY wasn't fitting into my risk profile:) How many shitty stocks can one person own at once?
RBY will probably work out but I bought it expecting a mondo-move yesterday which simply didn't develop. Ditto today. Truthfully I am not in loive with the chart as I re-evaluate it. RBY needs to do more first.
Thinking of adding to PAL one of these days soon....it is going to cross over the 20 day moving average soon...typically a rocket launcher for stocks.
SD...R1 is 7.00. SD has had a really hard time the last few go arounds with 7 also.
ReplyDeleteTomorrows match between the USA and ENG in the opening round of the World Cup has taken on another layer of interest :)...
ReplyDeleteMark - Yea, give us your formula. Sounds nice to be able to crunch numbers real time, you can actually use your own formulas and tweak them as you please?
ReplyDeleteIf I could get a data feed (data from Yahoo) into an excel spreadsheet, I'd do the same thing...
It can be done other ways too, probably just using HTML, and it's on my project list.
FTWR - The buzzards swooped in.
ReplyDeleteOpening back in HEK @ 4.85. Got to have SOMETHING to worry about.
ReplyDeleteShark,
ReplyDeleteRBY requires patience. It won't zoom till they have shaken out all the weak holders, I don't think, but if gold ever really takes off, it will be the up/coming miner to own because of its good ownership/mgmt (McEwen), high grades, proximity to goldcorp mine, existing mine and mill infrastructure, and CDN and US properties, which I consider safe if the world goes nuts.
Chicken,
ReplyDeleteWe're not in lobster territory, but I would be into splitting a couple of lobster rolls:)
Guys think of adding to your PAL positions based on either
a) a healthy selloff
b) an abiding continuation of this upmove.
CPST - Can ya believe it's still hovering just over $1? With the way index's are down I'd expect a lower price.
ReplyDeleteCP- FTWR's last plunge kinda pissed me off. I'm not sure I want to trade that one again. I feel lucky to have made money on that trade, and I don't like that feeling.
ReplyDeletesharkie - Hey, I've got almost a couple of hun off that tiny position so far, would buy a couple nice steak and lobster dinners at my favorite old dive in Worcester.
ReplyDeleteMark - FTWR I thought the action was pretty obvious, it was walking right down the trend line pretty as you please. Only a matter of time before it broke to the upside and it was right on que...
ReplyDeleteIt might happen again, I'll try to watch and see if the pattern begins to repeat.
Meanwhile, I'm trying to understand what FTWR has going for them aside from unused FCC licenses....
cheapy - You need to get off your butt and write us something that feeds off Yahoo finance we can drop formulas in...
ReplyDeleteOr maybe I do.... I never was a professional s/w guy, mine was a necessity just to make finicky hardware handshake routines and such. It's been 20 years since I wrote anything in "C".
GL guys....
ReplyDeleteGreat idea. However, drinks are on me!
ReplyDeleteGreen close...Dow closes up about 20 points.
ReplyDeleteMark, I just sold my SGG at $44, which I bought at $41.79.
ReplyDeleteAfter my UNG experience, I became a believer in the market *never* doing the obvious thing, and the double bottom in SGG just looks too easy to buy. If it were to behave like UNG, then it should do a couple more shakeouts before making a sustainable rally.
GCI has done well right off the 200. Sorry I lost track of it.
ReplyDeleteThanks David...I am thinking along the same lines.
ReplyDeleteI seriously think the market will get some lift during the world cup....Think about it.
ReplyDeleteLooked more closely at HEK. As a pure technical trade, I like it. Cleared the 300 and has some room before the 200 comes into play.
ReplyDeleteBGP caught my eye yesterday...
ReplyDeleteTake a look at FF's CPE...If it can clear the 50 here I might take a shot.
ReplyDeleteguys - based on the news flow there is no way in hell this market should be anything but down today. retail sales were abysmal, this oil spill is just an unmitigated disaster....i estimated that it is now 9 times as large as the exxon valdez spill, in an area that is much more at risk to environment disasters.
ReplyDeleteyet the market is practically unchanged. barring a disaster i think a bounce to the 1,140 area is certainly possible.
as for stocks, check out MBLX. i have been following this thing for 3 years now and really like the chart. they make biodegradable plastics in food packaging and food products. they are partnered with ADM. i think it's a great opportunity to go long here and i think this could be a huge long term winner.
also - mark, are you saying a 2,000 share position in SSO (or about $70k) is a small position? if so can i start referring to you as money bags?
by the way, a bounce to 1,140ish would make a perfect head and shoulders set up on the S&P.
ReplyDeleteTOF...I guess that did sound a little strange. I was really commenting on the size of my IRA, which that is that amount. I also mentally down size trade values in large index funds. For individual stocks, I seem to trade in blocks of 15K/30K/45K.
ReplyDeleteWith 3 young kids, believe me, no extra bags of cashola laying around here!!
Thanks for the idea. I'll take a look.
Mark, I think SGG is in a bottoming phase, but I'd be surprised if it doesn't drop below $40 in the next couple of weeks. My plan is to re-enter once it drops below $40.
ReplyDeleteexited some of my FTFL at $6.45 that I bought at $6.3 a couple of weeks ago. Also got the $0.20 dividend on the way, so all in all not a bad trade, about 5.6% gain.
ReplyDeleteMoved some into MBLX at $14.15.
I'm going to keep an eye, as always, on V here. Nice little pull back and a pretty clean stop.
ReplyDeleteTOF- I just saw that and was going to mention it here that some shares seemed available at 6.45. I still have my original position @ 6.30. I'll bid @ 3.36.
ReplyDeleteVIX @ 30.01...Yikes :)
ReplyDeleteTBT is a fing mess.
ReplyDeleteMark - maybe i sold some to you? ha. we could have just done that at the bar and avoided commissions.
ReplyDeleteGod...what a boring market.
ReplyDeleteMark - Vad made the same comment yday..."Still, the day was barely worth waking up for." -- The COIL is WINDING...
ReplyDeleteKyle..at least URU vs FRA world cup just started :)!
ReplyDeleteIt's not a turn by any means, but DAG had a nice bounce...
ReplyDeleteAny views on CDE???
ReplyDeleteHey Guys,
ReplyDeleteAnybody got any ideas about Nevsun Resourses NSU?
Bob,
ReplyDeleteSounds correct regarding RBY...I will watch it and try to enter at a more opportune time.
regarding NSU....it is making a really cool looking breakout on the weeklies...check it out. It's probably a winner.
ReplyDeleteshark - it's in the top 3 of my 2-10 top % gainers along with LCC & DCTH
ReplyDeleteKyle- CDE...Started by Jeffries with a buy, target 20.
ReplyDeleteMark - Thanks man - Looked like 14-lvl might hold
ReplyDeleteFinally starting to get a little volume in SPY.
ReplyDeleteLooks like the market is setting up for another sharp late day sell-off...
ReplyDeleteShark,
ReplyDeleteIt "feels" bottomed. They ran from my bid at the open and have avoided by a penny my bids all day long. But yet they put size on the ask. IMO, that means an accumulation game is being played, shaking out anyone let that rode it down. 2.97 would be a 50% retrace on the run from 70 cent range to 5.24, and the big seller filed the other day that they are down to 0 shares, which says to me they have nothing left to sell. My guess is today is the last of the fund selling. We'll see...
Cheapy, are you talking about RBY? The chart is really interesting.
ReplyDeleteI will watch it and get in at the right time for me.
ReplyDeleteThanks Bob.
Have a great weekend everybody.
From what I see, problem is the U$D is up.
ReplyDeleteYes, RBY is a Co. I follow... Was in "wait for opportunity" mode. Now building a position in low $3's.
ReplyDeleteV at 75.80.
ReplyDeleteI guess I was not the only one seeing the double top in the daily indices and a slow deterioration afterward. Apparently, enough short sellers have already jumped in, the boat tipped, and then BANG!
ReplyDeletenice close
ReplyDeletestilll long PAL
PAL - Finished the week with flying colors, was it gold, platinum, or just oversold?
ReplyDeleteI had taken some inspiration from the European close, thought it might telegraph.
ReplyDeletemy solution to dealing with this market: intravenous demerol....bought some more PID at near the close.
ReplyDeletelooking to start my own s/w reseller biz, late summer/early fall.
bro - you still long HEK? may sell, at a loss to match off w/some winners...lemme know.
Looks like UNG is not ready to drop below $7.85 just yet, so I might not be able to sell the desired $8 puts in the near future. However, if UNG doesn't go down, then it must make a new high! So I have just placed a sell limit order at $7.70 for the 700 shares of HNU.TO I sold last week at $7.35 and then reloaded this week at $6.70. So either this limit order gets hit next week or I get to sell puts on UNG below $7.85. :)
ReplyDeleteWow... and there was a time when I thought PID meant
ReplyDeletehttp://en.wikipedia.org/wiki/PID_controller
Just goes to show you...
CADC - One for us to watch? Trades a little thin but who thinks China might continue growing?
ReplyDelete