The Market in a Nutshell

This is the market in a nutshell:

1. The Dow moved to tops of 11,646.

2. FEAR on earnings led the first downside steps, to lows of 11,347.

Our open August 600C, two buys made, hit profits of to a top of 5.70. We had provide a top market sell to 6.40. Two buys could have been made on this, and profits are established.

In morning futures we saw a negative downside and recommended a high risk trade to the Aug525P. This position was available at up to 2.15, and hit no profits, only to lose value as the market moved higher later in the day.

The market now is at a count of 9 to the call. This shows an over extension to upside, and we consider the risk rising for the upside, as we've now hit market tops. Not yet time to recommend to the put, we'll open the market without a new signal, and advise intraday on market conditions.

Sorry, but I'd rather tell you not to trade than to trade just to "get in the market"

From trader BD:


"I added to my put position yesterday at the market open, 560 and 520, which I will exit today. Scalped profits on partial puts yesterday.

Opened call position yesterday at 3.60, will look to add to today."

This trader USES our alerts, and understands the market. Signals, not a key part of our work, he understands.....and uses for the parameters in which we build our trading education.
Next, Larry Berg tells us what could happen:

" Due to the current inaction to the world energy crisis by our U.S. Congress and its current President Bush . . . this is what happens . . .


Now, probably the most dangerous period in World History ---

Obama is elected President along with an overwhelmingly Democratic Congress. He immediately starts removing troops from Iraq. The price of oil starts to move up again and world stock markets continue to fall. Al Qaeda begins to re-establish itself in Iraq. Terrorists commit public mass murder of Iraqi citizens and government officials. Iran issues statement sympathizing with insurgents, considers the region 'theirs for the taking', steps up its nuclear enrichment program and ignores all United Nations sanctions.

Obama, at the urging of the public and press, has to insert troops again into Iraq to regain control. Too late. It fails. Insurgents take full control of major Iraqi cities and Iraqi oil fields. Oil prices increase dramatically from $140 to $200.

Iran increases it's infiltration of Iraq, supporting terrorists with supplies and weapons for anyone who may want to destabilize Iraq. Obama warns Iran to stay out of Iraq (ala Nixon's threat to China and U.S.S.R. to stay out of Vietnam). Iran warns of destruction of Israel if U.S. attacks Iran.

Obama warns Iran it will pursue air strikes against Iran (with the approval of a strongly Democratic Congress) if Iran does not stop assisting terrorists in Iraq. Iran responds by threatening to attack Persian Gulf shipping. Oil pushes up to $300. Obama submits to U.N. proposal to divide Jerusalem into two sections, one Christian one Moslem, fulfilling Biblical prophecy that Jerusalem will be divided at the 'end time'.

Iran attacks and sinks a Persian Gulf oil tanker. Obama has no choice but to defend oil transportation. Obama moves aircraft carrier group into the Persian Gulf and issues air strikes against Iranian coastal missile sites and Iranian Patrol Boats responsible for the attacks. Oil hits $500 overnight. World economies and markets tailspin. Obama insists that everything is "under control".

In the mean time Obama and Democratic Congress restrict all U.S. communications companies from monitoring overseas communications. Al Qaeda communicates to U.S. terrorist cells and implements terrorist attack in Chicago. 500 people die in car bombing of the World Trade Center.

Russia issues message of its support for Iran. Obama warns Russia not to insert itself into the confrontation. Russia moves hardware to support Iran. Oil hits $800. Transportation of world goods and services comes to a halt. World economies crash.

Russia supports Iranian ground-to-air missile attacks against U.S. aircraft. Oil hits $1,000. You can take it from there . . .

As the Boy Scout motto says, 'Be Prepared'. Brazil is the only country in the world which is energy independent, America friendly, Christian and able to survive the coming world political and economic crisis. Bill Gates is now buying up as much Brazilian ranch land as he can, investing in Brazilian sugarcane ethanol. I wonder . . . is it simply an investment or a means of survival?"

And Floyd give us his:

What happens if McCain comes in, using the same scenario above? War is good to John boy, "take no prisoners" thinking. Environmentally about as far right as can be imagined, McCain would bring the bravado to the frey, the same bravado that has built our fear, built our "we can get em" Bush attitude.

Elect smart.

Floydian thinking:

If a trader believes, in the market that we are experiencing, that each signal will be profitable it's time to close the bank.
Market conditions are simply extraordinary, frightening, and not clearly chartable. 2000 point drops to 500 point rises, to whipsaw that occurs almost hourly at this point. Each of our signals was profitable last week.
One trade has been profitable this week, but expect to lose on some trades. This is NOT negative thinking, just facing the facts of the type of market we are dealing with.