Thursday, June 23, 2011

THIS IS WHERE IT GETS KINKY


No I don't mean Ben pulls a three-way. Its where Ben pulls a rabbit out of his proverbial ass. Now here is the problem. Everytime Ben pulls a rabbit out of his ass he has to visit his proctologist and it starting to run up quite a bill for him. Ben spent a major portion of his life studying the Great Depression while he burned bowls with his wild and crazy hippy buddies at Harvard and MIT. These guys were preparing for the future while they lived the purple haze in the hallowed halls. It wasn't pretty but by the time it was over, Ben was a well-healed soldier. After the appropriate "cleaning up" and grooming at Princeton our Ivy League scholar was prepared to be brought in by the big boyz into the real "lever-room". So here we are. This is where the rubber meets the road for the man of steel. He's even able to stand up and face Q&A after a rugged day at the FOMC. This type of metal is not to be dismissed. After facing withering questions from the likes of Steve Loserman from CNBS one can only speculate how long Ben can hold up under this type of blistering cross-examination.

Of course he was able to not only defend our current monetary policy but managed to educate those of us in the wilderness of ignorance once again how monetary policy has no effect on the cost of essential currently and that inflation is under control. Of course he expressed displeasure and surprise that there has not been more job creation but of course we all know that will change in the latter half of the year. Meanwhile there is a slow sizzle going on in the Eurozone and the bankers just don't know how to pull all the levers to get the creditors off scott free in all the PIIGS. No problem though.....they will....One way or another the bulk of the fallout will land squarely on the peeps. The test run in Greece showed the boyz how much stomach the Greek peeps had for a fight. They're a little more nervous about those damn Irish though so my guess is they are in for another test soon before the move on the the volatile Spanish.

Enough levity let's get down to business. IF IF IF we saw the bottom in the miners this year then there is more fun to come, but if you're a short term trader I hope you were pulling some profit yesterday. They gave you a gift. I probably stayed to long in some but I did pull back some cash. The "pair trade" of GFI EGO is going as advertised....rarely do these pos rise in tandem...rotating them is a strange way to play a "pair trade" but it has worked with these range bound dogs.

GORO, GBG, ANV , EGO showed some very strong volume and moves off of this bounce which is hard for the boyz to disguise. I guess we'll see. I own a lot of miners....RIC looks like a buy and hold but I'll trade it too.....RIC has no dilution as Joe noted.

OK OK....is Ben going to pull a rabbit out of his ass? answer YES..... but it gets tricky now. QE2 was a political no brainer for him but there may not be another overt QE......but make NO mistake there will be NO STOPPING QE and monetization. Who's going to buy those 200 BILLION/month of treasury debt. Without it there would be an immediate liquidity freeze. The only questin is what kind of rabbit comes out. It won't be pretty and it won't smell good. (sorry that was cheap) The reason it won't be pretty is because the tricks will have less and less impact. Things are getting dicey gang. You can't get those jobs going. You can't get those houses turned around. This ship is going down...its just a question of how and how fast. gl



76 comments:

  1. Of course there will be more stimulus of some kind.. We've replaced at least 10% of our GDP with borrowed money, if we stop borrowing then GDP contracts immediately.

    ReplyDelete
  2. Basically until the pile of cans becomes so large we cannot kick it anymore you can expect more can kicks.

    ReplyDelete
  3. Keep an eye on LLEN this am

    ReplyDelete
  4. Oil, Gold, and Silver getting hammered, take it down baby!

    ReplyDelete
  5. Been wanting to grab some GENE, going to today

    ReplyDelete
  6. ANV is VERY interesting virtually no sell volume and has flatlined inspite of the last market dip.......those big green candle buys are sitting tight......

    ReplyDelete
  7. ANV first support held like a rock hmmmmmm

    ReplyDelete
  8. SVM and MDR gave a very nice gap down today to be played for daily gap bounce. Airline stocks doing nicely today as well due to lower oil.

    ReplyDelete
  9. kli,

    Speaking of tape reading, LCC was yummy !

    ReplyDelete
  10. RJA - ag commodities ETF looking interesting

    ReplyDelete
  11. this is a beautiful, coordinated move to crush the oil price....you can bet that GS had its shorts well positioned...so recognize that the effect on liquidity could be dramatic. My guess is they are trying to fine tune the price without destroying the liquidity. If this is engineered and of course it is then I say they maintain liquidity......miners remain a play until they break the previous low.

    ReplyDelete
  12. DAG whacked too......I like the miners response today better but I own DAG ....its targeted so I'll wait a lil to add

    ReplyDelete
  13. Red & Kli,

    Some one is hammering ATPG for you, heheeeeeeee!

    ReplyDelete
  14. Sky is falling, sky is falling, heheeeeeee!

    ReplyDelete
  15. Red,

    There is a sea of Red, heheeeeeeee!

    ReplyDelete
  16. CNBS will be scheduling an octagon today for the panic pile on......

    ReplyDelete
  17. kli,

    FEAR is a good thing, Oil, Gold, and Silver are headed for 0, pass the word every one, I prefer DEFLATION to the other poison, heheeeeeee!

    ReplyDelete
  18. Wow! Look at Mobi, they dragged it down last week...now up over 10%...

    ReplyDelete
  19. Oh, and pm opex on Monday, the 27th so may see more slaughter going into it...but anv and slw hanging tough.

    ReplyDelete
  20. Oil going to zero hehee, that's a good one joe!

    ReplyDelete
  21. kli,

    You see now what I mean by playing the intra-day bounce in days which market starts with real bang like today, they took it down to 18 and now it's 18.60, if you can read the action and the tape then it makes no difference how overall market is doing, playing it when there is turmoil in the market.

    ReplyDelete
  22. I was refering to MDR in my above post.

    ReplyDelete
  23. Ryan,

    LLEN was a good play today, in order to really confirm that shorts are ready to cover on that one, LLEN needs to get to $6 and hold, if it does not in coming days then most momo and swing traders will see this as hit and run and will shy away.

    ReplyDelete
  24. oh no......just found out Justin Baever and Obama going to be at La Guardia tonight the same time my flight gets in......gotta show at 8 to make.....waaaaaaaa

    ReplyDelete
  25. Kli -- went long EUO earlier in the week, trying to decide whther to take a profit here. I know long-term move is euro lower (EUO up), but if one is going to play the volatilty how do you think it moves over the next few days. Thx!!!

    ReplyDelete
  26. Kli,

    $HUI dropped right back down to the $500 level, i do know one thing, i have no clue how to play the PM trade. own EGO, considering adding on this pullback, but the weekly chart on the $hui looks like gold could go a lot lower if this 490's/500 level doesnt hold. any thoughts.

    one last thought, screw GS, damn bastards, now i know why they changed there tune and said $130 oil. i am sure they a rolling in the coin on the lower oil prices.

    ReplyDelete
  27. Rude,

    Gold needs to come down to 1400 and Silver to 28, and as far as S&P is concerned, if 1249 in coming days at the closing of the market does not hold then market will go lot lower, watch the action and make sure not to get emotional one way or the other, if you have no clue then that's the signal to you logically to stay away and watch till you get a better picture, there is a good reason it's called CASINO.

    ReplyDelete
  28. The freakier the market gets, the better kli likes it, heheeeeeee!

    ReplyDelete
  29. Joe,
    Gold/Silver need to or will?

    ReplyDelete
  30. Tom,

    It needs to and if market continues in the same path as today it will. The only people that can tell it WILL for sure are those on the know which are few powerful bankers who set the rules. If any one tells you that they KNEW it will, then you are either were talking to fakes who guessed right or you actually had a conversation with most powerful entity on earth which moves the market. The latter for you is almost impossible.

    ReplyDelete
  31. Tom,

    Based on my response above I stand by my original statement which is NEED to and hope that it does.

    ReplyDelete
  32. Reloaded some RNN at 1.18 today in my swing trades. Steady green scalping for 2 weeks now. maybe skittish trading suits me.

    ReplyDelete
  33. By the way Tom, what you asked was not wise at all since common sense dictates that no one and I mean no one except few powerful bankers can make a statement of it WILL. Every one else is in the guessing game, some can guess more accurately than others but still is a guess unless for the ones I mentioned which they actually KNOW.

    ReplyDelete
  34. Thanks you answered my question, just gonna hang back and wait. "almost impossible" hehehehe like my Dad used to say "I'd have a better chance of meeting God" before that happened!

    ReplyDelete
  35. No rush to make any moves here than just intraday day trades....ANV was nice this am......but a core is still a hold

    ReplyDelete
  36. the only thing for sure is you're gonna die.......btw the only people that know for sure are the handful of VERY powerful bankers (that btw you do not know) that give their minions their marching orders.....minions for example include Bernanke Obama sarkozy etc.......

    ReplyDelete
  37. Can't play intraday anymore had to put the hands back to work... Just looking to add to PHYS and PSLV

    ReplyDelete
  38. Kli,

    If your flying in tonight GOOD LUCK your gonna be fighting some nasty weather on top of Bevis and POTUS.....

    ReplyDelete
  39. don't feel bad guys n gals.....the floor traders are puking all over their socks......maybe someday they will figure it out....hehehehe....there was heavy selling volume in crude prior to the announcement this morning......"some" of the traders knew...hehehehe

    ReplyDelete
  40. kli,

    MDR, MDR, MDR, saw the tape turn right at $18 this morning, now 18.90, hehhheeeeeeeee!

    ReplyDelete
  41. Joe,

    Thanks for your comments on LLEN. I will keep a very close eye on it. I have been playing it for the last 2 weeks and have done pretty good. I do have a small core that I bought at 4.77.

    ReplyDelete
  42. still mostly intraday plays on oil and pm stocks. nothing to interesting to hold longer term at moment. just have to wait to see how things play at 1249 for any longer term positions.

    ReplyDelete
  43. Any else read how GS shrunk the Libya sovereign fund 98% in just a few years with citibank calls?

    I wonder if that was planned.

    ReplyDelete
  44. Yes Ken....all planned....will bring you some "stuff" if I can find it.

    ReplyDelete
  45. heads up, ngsx getting bid back up now...

    ReplyDelete
  46. Ryan,

    I played LLEN today and it was nice, make sure you are nimble and do not hesitate to take profit, always better to take profit and see stock go higher than not take profit and then see trade turn to loss, especially in the current market we are in, stay sharp!

    ReplyDelete
  47. Ken,
    Be careful on the RNN trade....Sale of 1.2 million shares @ 1.22 came in 2 days ago....targeting below $1

    ReplyDelete
  48. BTW just in case anyone here doubts today's move on the SPR......that was a rabbit from Ben......that was our boyz on top tapping on the brakes for the "little people"...gotta keep the game going...there will be more rabbits...

    ReplyDelete
  49. tklc should be watched...50sma almost above 100 and huge gap to 200sma at 10.38 is for the taking..volume is good...multiple bottom at 7.50...solid support...

    ReplyDelete
  50. This comment has been removed by a blog administrator.

    ReplyDelete
  51. Chuck,

    The reason I asked is because I like some of his posts!

    ReplyDelete
  52. Joe, shhhhhhh! be bery bery quiet..I'm hunting rabbits...

    looks like shorts are doing all the selling to cover on ngsx...

    ReplyDelete
  53. Chuck,

    I understand what you mean, heheeeeeee!

    ReplyDelete
  54. looks like the bottom formation on miners for now remains intact......gl hunting

    ReplyDelete
  55. GPL has formed a higher high AND backtested the 50ma with a rocket candle and tail

    ReplyDelete
  56. ANV forming same inv hns .....holding under the 50 however but target is 49 when (if) it breaks and holds above

    ReplyDelete
  57. the sp500 new high new low indicator looked like big fake/shake out to get cheap shares from the sheeple.......

    I think the rotation out of reits is near..maybe one more shake out....while rotation back into china could be in play....random thoughts...mm's could make some nice change on that trade short reits-long china...they have enough symbols to pick from....

    I ment'd HEAT last week at 1.15...still might be a squeeze opportunity...

    ReplyDelete
  58. this market has longer to run near term.

    ReplyDelete
  59. Well that woke me up. I thought I was done for the day.....had to make another trade, but did not hold for overnight. might be a mistake, but green is green. $$$

    I agree Kli, bulls closed up in a way that implies follow through. SPY closed above daily 5ma

    ReplyDelete
  60. kli, joe

    here's what could help them run....

    uh oh....

    http://content.screencast.com/users/wprosser/folders/Jing/media/5a364045-1cca-4cf5-9998-7085e2ac2c95/2011-06-23_1321.png

    ReplyDelete
  61. This comment has been removed by the author.

    ReplyDelete
  62. Hi Joe,

    Been reading you for a while but first time poster - FWIW I sincerley appreciate all of your shared knowledge. Was hoping you could elaborate on how you read the tape to anticipate price action. You alluded to spotting the tape turn on MDR at 18, is this anything more than keeping an eye out for abnormally large orders and whether or not they are hitting the ask vs. the bid?

    All the best,

    -V

    ReplyDelete
  63. Victory.....Joe uses level 3.....and maybe 4.....it shows on the down gap days .....intraday covering by the MMs and boyz will begin to cover and go long and the capacity to see this is from watching the tape. Level 2 shows a little.....but level 3 shows WHAT they're doing more clearly.....that's how they control the bid/ask. He can tell you himself in more detail.

    ReplyDelete
  64. Hi Kli,

    Thanks for the response, still unclear as to the actual mechanics so hopefully Joe has time to expound.

    Best,

    -V

    ReplyDelete
  65. Victory,

    Using MDR as an example, at the open market tanked heavy especially oil which means the MMs and hedge funds gaped down the price which means thru shorting, taking out stops quickly they droped the bid and the ask, the larger the gap the better it is for them, it also means intra day they cover either part or all the gap for double duty, they made money in the gap down and then made money again by filling gap intra day and taking it back up, for retail trader when the VOLUME for the stock starts to pick up after hitting specific price range where there are no more dump is the teller that tape has turned, the same goes for SVM today ,,etc. In the case of MDR which is a heavy duty company, the stock has already had a solid retracement from 52 week high so any large gap down especially would face gap covering in intraday basis, for you the key is the price and the daily volume especially if the gap down was not done thru heavy volume and you see volume picking up heavier to turn back and fill it.

    ReplyDelete
  66. Victory,

    The MMS and hedge funds also do naked short selling to take stocks down which does not show in actual print volume. Tape turns in intra day when you see bid & ask stabilize and volume picks up, the other side of the coin is also the same except it's the opposite direction, they gap up the price only to take it down further.

    ReplyDelete
  67. If a stock has low volume + low float/outstanding shares, MMS use 100 shres or 200 shares at the time to drop the bid and when retail traders see the price drop and panic then MMs take the stops out and add lot more shares which means they take away what retail trader puked and use it to short until most sellers are gone and then they shove it back up, these days it's much simpler for them to do it since everything is algo driven. For retail traders who are very good at scalping, studying pattern of behavior related to the particular stock they are trading is important.

    ReplyDelete
  68. Joe,

    got it, thank you for that! I've noticed others come to this site to pick your brains along with the other resident trail guides here (Kli, Red, & others) - as such I was wondering if any of you could recomend any books trading? I've read dozens but if there is one that comes highly recommended by someone from this blog that I have not read that would be quite a gift:-)

    give a man a fish and he eats for a day...teach a man to fish and he eats for a lifetime

    sincerely,

    -V

    ReplyDelete
  69. Victory,

    Clif Droke has written couple of nice books on trading. I learned the old fashion way 36 yrs ago when trading/investing was nothing like there is today and learned mainly by myself and every yr I try to update my knowledge by constant studying of the pattern of behavior, when it changes and how to adjust to change. Google Clif Droke trading books and you see a good list of books he has written on trading.

    P.S.

    Your last statement is spoken like a true liberterian and i completely agree with that statement, otherwise a society will end up being a welfare state.

    ReplyDelete
  70. Also Victory check out daily blog of one of our regular posters INLET, he is a good man, I like his analysis daily especially on cycles and his blog is called, " Swing trade Cycles" which you see under kli's blog list at the left side of this blog.

    ReplyDelete
  71. Joe - Thanks for the mention.

    ORCL was down around 6% AH. Couldn't help myself - had to buy some for a scalp. Hehehe AH had a 2.3% or so gain, will sell in the AM.

    ReplyDelete
  72. thanks Joe..

    mice trade inlet..for a second everyone thought ORCL was MU...

    ReplyDelete