Mad As Hellers

"When a country lives on borrowed time, borrowed money and borrowed energy, it is just begging the markets to discipline it in their own way at their own time. Usually the markets do it in an orderly way - except when they don't." - Thomas L. Friedman

The market did what we expected yesterday. Futures were dramatically up from 4 a.m. on and the market opened to a theoretical Dow top of 10,083, or 1.32% by 10 a.m.
The February 490 Call, bought Monday, hit highs of $9.00 by 11.30 am., for a call that cost us between 6.30 and 7.40. Better still, this call had hit $9.40, and those following support and resistance were madly recalculating for the day. As the market approached 190 points up we sent a second twitter, recalculating Dow tops. Nice two day profits, both put and call.

And what's next? More whipsaw. More confusion. More argument between bull and bear.

Yesterday was aggressive in both the volatility of the whipsaw, and in the struggles just above 10,050 to 10,100.

When the market moves over 100 points up in a day and holds, it is a good sign the bias is changing upward, while it takes a 230 to 250 point drop that holds to show a true correction.

Yesterday needs follow through to show a bull bias. Option trading has become much faster and more "extreme" in the depth numbers wlll go. Two years ago 190 point climb would have been euphoria in the news. Today, it's wait and see if the market does it "again." It is as if: no one believes.



From subscriber MP: And what or who am I angry with and how does it effect my trading? Great question...

"I've been wrestling with this one for months now...and here is my quick conclusion...

I'm very angry at myself for consistently demonstrating a lack of self-control. This is evident in me being over-weight and unable to control my eating patterns. I'm angry that I've gained 25 lbs. over the last 2-3 years so I eat more crap b/c it makes me feel better (temporarily)...but this just causes me to gain more weight which perpetuates the cycle...

This self-condemnation and mild depression (anger turned inward) is also evident in what I call grudge trading...this where I would take trades out of anger to try and get my money back or make myself feel better by winning (like a gambler)...

what I'm learning is how to love myself for who I am...release destructive emotions like fear and greed, accept responsibility for my decisions and just stick to a trading plan...why I do those things - I'm successful.

"But to answer your question - anger towards yourself or anyone for that matter can easily distract you and cause a trader to make unnecessary gambles...which will just make him or her even angrier! "


Today we study whether the U.S. Trade deficit is widening, the budget deficit is narrowing, and Bernanke testifies about unwinding emergency Fed liquidity program.

Tomorrow we'll watch for retail sales and initial jobless claims, which routed the market last week, are released.
And I give you one thought about Obama (or whomever carries the torch) and our economy:

We all know our long term debt to GDP ratio is high now, whether in terms like this, or "you can't just borrow this much." But it worsens, as there are many other debts from past administrations that come due now. And we all know, really, that the President now has two wars, and nothing is right. No one can say what they would do in the position, it's all talk or games, but we've added a third group, called the "Mad as Hellers." These folks know they are being phucked by Wall Street, and the government can't get past itself to regulate it, and we repeat the same action, reward and risk.

These Mad as Hellers want government to slow down. They blame the government, when in fact it may be the economy that affects (remember: cause and effect) and they are mad that there are not jobs, and that taxes could go up. This is the "maligned" the "common man" and we see it in the market.


An excerpt from our Blue Chip Options advisory service:

Materials were yesterday's big movers, and we're strong in this sector. Many stocks held their 200 day moving average, which suggests a short term bottom; if the rally were to increase we'd see the next resistance at the 50 day moving average.