The market sentiment has turned decidedly bullish in anticipation of QE2. While this is hurting our short position we can't help but believe this will end badly. Still holding current positions.
Bulls Everywhere 10/11/2010
The market sentiment has turned decidedly bullish in anticipation of QE2. While this is hurting our short position we can't help but believe this will end badly. Still holding current positions.
10/01/2010 Load the Truck up!!!
Time to load the truck up with puts!!!
Gold is soaring! Talking heads on CNBC are tripping all over themselves to be bullish.
If Gold is soaring and the Dollar crashing, then why are stocks not already at 1200 S&P or beyond? Perhaps the future is not so bright so take those shades off! (Especially the rose colored ones).
Short Oct, Nov & Dec SPY Call spreads. Long Oct, Nov & Dec. puts. Long UUP, 50% short GLD. (Hope I'm right)
September 17, 2010
Our gold trade is a bit early but the long side is so crowded, we are staying with our shorts.
While the stock market has reached the upper end of its trading range, we have conflicting scenarios:
The volume hasn't come back perhaps because the individual investor is through giving his money to the game. (At least the stock game - they are throwing it away in huge numbers to bonds - soon to be highly disappointed).Will this lead to an eventual war of the big dogs attacking each other. The game must go on but if the retail investor does not come in, which we believe they won't then the big boys will turn on each other creating a monster sell off.
or
The market will keep pushing higher in spite of the worsening technicals still believing the retail customer will be there for the institutions to unload their positions.
We like the first scenario. We are staying short, selling call spreads into this rally, on gold and SPY. Buying dollars and UUP.
9/10/2010 SHORT GOLD!
Gold truly is a beautiful metal, but at this price? I don't think so.
Shorting gold today for a long term swing trade.
09/03/2010 Last Train to Clarksville
So there was our tradeable rally. A freight train straight up. Here's a picture of how this ride will end.
Welcome to September, now fasten your seatbelts.
Some might say we are starting a new bull market. I doubt it.
Sold more calls at the close today.
08/24/2010 The Hindenburg Omen?
When everybody is convinced something is going to happen, it rarely does. The current negativity in the market will lead to a tradeable bounce. The question is from what level?
Bonds are clearly in a bubble with much risk and little return. Will this money head into stocks? Some will, chasing dividends.
Europe on its way to round two of destabilization.
Short stocks, short bonds and adding to our Long US Dollar position!!
August 18, 2010
Let's get ready to rumble!!!
The spike of mortgage refinancings will not stimulate the economy because the ony people who can refinance now are the responsible ones. They are simply refinancing to lower their rate. (A very smart move since 30 mortgage rates are the lowest they've ever been).
These folks however, aren't using the extra saving to buy new cars or tv's, etc. Like I said, these are the responsible people. The rest can't take advantage of the low rates because they either don't qualify or are still underwater on their current mortgage. (Of course these are the same folks who bought new cars and tv's and things the last time they refinanced).
So....Look out below!!!! Let's get ready to rumble!!! My bet is on the bear!
July 30,2010 Deja Vu?
Brings back memories from the Dot-com bubble
http://www.cnbc.com/id/38491131
March of the Profitless IPOs: More to Come Next Week
Expect to see highly leveraged, profitless deals as private equity looks to exit into a market that appears interested mostly in the trade, not the company. Herb Greenberg reports.
There was a time when big profitless IPOs were at the end of an IPO cycle, signalling some kind of market top.
Yet the march of the profitless IPOs continues. Two that caught my attention from next week's calendar, in no particular order:
Intralinks Holdings. This company lets businesses securely exchange data in the cloud. This is its third swipe at going public since 1999.
It's coming out just three years after private equity got involved and three areas concern:
It's making no money. It has a bunch of debt. A ton of competition.
And in my humble opinion, it's trying to capitalize on anything remotely cloud-related before that window closes.
Herb Greenberg
Senior Stocks
Commentator
The second is NXP Semiconductor, which makes chips used for all sorts of products. It's backed by KKR [KKR 9.05 -0.43 (-4.54%) ], Bain and Silverlake, among others.
Like IntraLinks, it has a history of losses. And tons of competition, including Freescale, which is rumored to be looking to IPO soon.
And, like many private equity deals, it has billions in debt—five billion, to be precise. It's so much debt, in fact, that any use of the $600 million or so in proceeds will be a drop in the bucket to help repay the debt.
My take: Expect to see more of these highly leveraged, profitless deals as private equity looks to exit into a market that appears interested mostly in the trade, not the company.
7/22/2010 Europe news looking better. The clam before the storm this fall!
July 22, 2010 8:32 AM EDT
GM to acquire AmeriCredit for $3.5 billion.
We were highly critical of the sale of the controlling stake of GMAC in 2006 by the incompetent management at GM. At the time we said they simply don't understand their business. Just like IBM, it took Gerstner from RJR Nabisco to run a computer company, a Telecom exec is showing some sense in running an Auto Manufacturer/Sales company. (Perhaps it is the "Sales" part the old guard didn't understand).
Good job Ed Whitacre!
July 21, 2010
Economic outlook remains "unusually uncertain."
Bull/Bear case is at a crossroads. Tomorrow's Jobs report could tilt the hand one way or another.
Looking short term for a break of either 1100 to the upside or 1040 to the downside to determine future direction.
July 10, 2010 Lot's of Bears
While we continue to believe the market will roll over from here and head south fast, there are concerning signs with the number of bears.
http://www.cnbc.com/id/38168490
In third waves however, you can allow for a majority to be alined in the same direction for a while. This of course leads to a majority of bearish conviction which in turn will create a buying opportunity. We just feel at this point that it will be from a lower level.
Any sustained move above this current 1080/1090 level could signal the low is in place.
07/05/2010
Happy Independence Day!!!! Remember why this holiday exist!
Looking for a short term capitulation. Add to shorts on the bounce. Far from over on the downside medium to long term.
Looking for a short term capitulation. Add to shorts on the bounce. Far from over on the downside medium to long term.
06/08/2010 Time to reload!
Reloaded 25% of shorts at the close. Will continue to reload up to 1080.
Some technicals looking bullish. However, we just don't think the bottom is in yet.
Two moves to make at the edge of the abyss.
1) fall over
2) go away
We're reloading for scenario #1.
06/06/2010
We sold our puts and closed short positions on the close Friday. Although this market could still plunge lower, there is a clear divergence between the Dow/S&P and NASDAQ.
Typically when NASDAQ leads we rally. Most techs are well capitalized with low debt structures. We are currently very oversold, however in this type situation the cliff still lies ahead. Whether or not it is tomorrow, next week or next month, we are close to the abyss.
Looking to re-enter short positions as soon as we relieve the oversold condition.
05/03/2010 Deflation ahead!
Deflation increases the debt burden. Inflation will eventually be the only way out for sovereign debt. If it would only happen sooner rather than later.
05/01/2010 GM pays back loan??????
http://www.forbes.com/2010/04/23/general-motors-economy-bailout-opinions-columnists-shikha-dalmia.html
Nice!
The market has either topped or we will make one more run towards a new high, then look out below.
2nd half of 2010 will be like 2008.
Nice!
The market has either topped or we will make one more run towards a new high, then look out below.
2nd half of 2010 will be like 2008.
03/04/2010
Not a bear in sight.
Beware the Ides of March!
The market has risen on bad news for quite a while now. Here comes the good news and the sell off.
When there is blood on the streets you buy. When it looks like the governments of the world have saved us all from ourselves, it must be time to sell.
Holding short. Adding to positions.
2/18/2010 The Party's Over!
Sample of today's headlines:
Jobless Claims, Inflation Jump as Economy Wobbles
Bank Profits Ready to Tumble, Stocks to Fall: Whitney
Wal-Mart Sales Fall Short of Forecasts
Fed Raises Discount Rate to 0.75% From 0.50%
Does anybody else see what is happening? The Fed must now start reeling in the massive amount of liquidity it has poured into the market.
Rates rising, Dollar soaring, Euro crashing, unemployment rising, Sovereign debt coming out of the closet (thanks to GS). Hmmmm.
Earlier this week the Chinese expressed that they maybe tire of buying our debt. Well, let's give them a higher rate to entice them to buy more! (Yeh, that'll work).
Next weeks headlines:
Weak demand for Treasury Auction!
Even if the economy can somehow continue to grow, the run in the stock market is over!
Might have been early on the 14th but happy with our position.
Tsunami to the downside 02/14/2010
Back to 200% short. A tsunami of selling lies ahead as we are on the precipice of a collapse in stock prices.
2010 will be the year of runaway deflation due to massive government and sovereign debt. Bailing out Greece will only produce a precedent of "here is where the line starts" for more bailouts, be it Dubai, Spain or Portugal, etc.
The public sentiment towards Goldman Sachs, and other large banking/brokerage institutions will reach a negative extreme and turn buyers away from stocks as the perception of the game will seem rigged. 401k holders who rode the wave down, then back up trying to get back to even, only to see their loses mount again will walk away thoroughly disgusted at Wall Street.
Only the understanding of the game, that money can be made going up or down, will be the key to survival in this market.
2/5/2010 Roller Coaster
Wheeeeee! Alright! Covered shorts right after 1:00 p.m., unfortunately just before a VIX spike and 10 point drop to 1044.50 which would have increaed profits greatly, but oh well, you can never pick the exact tops or bottom unless you just get lucky. (rather be lucky than good).
Short term - Market has created positive divergences on many time levels. Perhaps a shot down and then rally up into overbought conditions before we resume the downside.
Wait and let the market tell you what it is going to do.
LET'S RIDE THIS ROLLER COASTER!
2/04/2010 LOOK OUT BELOW!
While even bear markets don't go straight down, this one has a long way to go. The market is quite oversold at the moment, but as we know the market can stay irrational a lot longer than we can stay solvent.
Greece, today. Spain tomorrow, perhaps Great Britain will become insolvent as well. All I can say is that global debt is a killer!
Like the iceberg, that is a lot below that we can't even see.
Holding short but expecting some buying to relieve the O/S condition.
01/31/2010 SO FAR SO GOOD!
THE STOCK MARKET TOPPED ON QUE. (OF COURSE IT SURE TOOK A WHILE TO GET THERE)
WE SHOULD SEE A BOUNCE THIS WEEK. SHOULD BEING THE OPERATIVE WORD. MY CONCERN IS IT ACCELERATES TO THE DOWNSIDE AND WE CAN'T ADD TO OUR SHORTS.
MORE THAN LIKELY WE WILL SEE ONE LAST PUSH BY THE BULLS TO RUN THIS RAT HIGHER. IT THAT HAPPENS, IT WILL BE THE BEST GIFT WE COULD ASK FOR.
THE MARKET HAS HIT THE HIGHS FOR THE YEAR. MY QUESTION IS WILL IT JUST RETEST LAST YEARS LOWS OR GO LOWER.
COVER ALL SHORT POSITIONS AND WAIT TO RE-SHORT. DO NOT PLAY THE LONG SIDE.
LATER
WE SHOULD SEE A BOUNCE THIS WEEK. SHOULD BEING THE OPERATIVE WORD. MY CONCERN IS IT ACCELERATES TO THE DOWNSIDE AND WE CAN'T ADD TO OUR SHORTS.
MORE THAN LIKELY WE WILL SEE ONE LAST PUSH BY THE BULLS TO RUN THIS RAT HIGHER. IT THAT HAPPENS, IT WILL BE THE BEST GIFT WE COULD ASK FOR.
THE MARKET HAS HIT THE HIGHS FOR THE YEAR. MY QUESTION IS WILL IT JUST RETEST LAST YEARS LOWS OR GO LOWER.
COVER ALL SHORT POSITIONS AND WAIT TO RE-SHORT. DO NOT PLAY THE LONG SIDE.
LATER
01/17/2010 Rome is Burning
The Stock Market has registered its high for 2010. Friday's sell off is the first crack in the dam. Opportunity abounds!
This years profits will be from shorting rallys, just the opposite of 2009, buying the dips.
Welcome to wave 3 down!
Happy New Year!
(taken from Xtrends) Thank you for the composition.
Just as our government leaders didn't see what was coming then, they certainly do not see what is coming now.
Fasten your seat belts and welcome to 2010.
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