Maybe I can clear up a little how I trade - I have been watching 50-100 stocks trade every day on level II for over a year(the list always seems to grow), different sectors, different investor types, etc...At first it was overwhelming, lately it has become very familiar, instead of watching the indices alone or a few stocks, watching this amount of internals gives me a good "gut" feel for what I think is happening, the tape throws enough sh*t at my brain that more and more of it sticks as time goes by. Putting that together with fundamental research, macro research, reading CFZ -g-, I have come to the conclusion that stocks are going out of favor and have been trading off that premise for the past several months. I have taken some losses and/or rolled forward a few expiries on some bank and broker puts as well as some other nyse pigs (ko, ba, pvn, ccr, mmm) but many of those are coming home to roost now and the tech valuation correction has more than made up for the bad timing on those trades which will eventually be good timing -g Much as in the euphoria on the way up, most shorts are no brainers on the way down, for example, I have been shorting RIMM and HAND mercilessly and will continue to do so, they are gadget stocks and will have gadget stock prices soon enough, maybe before they even can put a email device on a keychain and put out a press release so they can sell more stock.
I don't want to invest in anyone's company right now unless they are digging up gold, and I don't think other people should want to either, if they were sane...some are sure acting like they don't want to judging by the selling. The meltup after the fed rate cut did more to hurt this market technically than to help it, IMO...it got rid of the new shorts and there is even less support now...notice how today was one of those rare days where even in the last hour, half hour, 15, 5 minutes, there was not much panic buying, hardly any short covering, even very little of the usual dipsh*t fido or janus "look everyone, we are bidding 80000000 shares of CSCO over INCA panic buying short scaring/daytrader suck in scam" buying...seems the gunpowder is wet or out and I can't think of many positive catalysts on the horizon. Not looking for a technical target on how far things will fall, except that I think it will be lower than anyone thinks so 1800 is not my floor but I will surely take some profits there and on the way down as I have been doing. I'm pretty sure all the buyers bought already, now I will wait until they get tired of selling what they bought to each other at better and better sale prices. The smart bet here, IMO, is that the economy will be worse than all projections, because if it is better that will take time to be proven, while as bad news piles up, only the levels of fear in people's minds and wallets will dictate how bad a scenario can get priced in, and there is a bunch of potential badness that is not being talked about or acted on yet. Of course, I may be underestimating the market's power as a discounting mechanism and the sheer amount of liquidity which may have created a permanent demand side imbalance in the casino, but I don't think so. |
