G-20 Ends With Little to Show

The first week the Dow slipped in a slippery battle between support and resistance. Bulls see highs of 12,746, with a potential drop to 11,890 before or AFTER this move; Floyd continues to see whipsaw but upside through December. Now is the time ALWAYS to lock profits when you can. G-20 Ends With Little to Show http://online.wsj.com/article/SB10001424052970203804204577017353037510564.html Dow Snaps Win Streak http://online.wsj.com/article/SB10001424052970203804204577017512073206828.html ____________________________ Economic Calendar: http://www.bloomberg.com/markets/economic-calendar/ We are enclosing 4 Dow and and OEX Point and Figure charts showing the bullish % and the area above 50 day and 200 day moving averages. We saw our first slippage this past week We are also leading off this week with charts as our conversations this week will be entirely about existing holdings, current recommendations,and where equities now play an even more important role The test of our progress is not whet ether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little. FDR (Many Christians will find this socialistic jargon as giving is only IN the Bible, not over sharing) ___________________________________________________________________________________ At OEX Options we offer an advanced mentoring service to a limited group at a time. Our approach is legendary in that we have no course, no book, and all is customized to the client. Study: http://www.oexoptions.com/AdvancedMentoring/AM.html I find most fascinating a recent subscriber at 20 years of age, my youngest client yet. I require of students that they they a number of psychological tests and also write a letter to me answering a series of questions . This letter has been slightly altered to protect confidentiality, but is presented along with my responses to the client and an analysis if his psychological testing. What AJ is learning about himself is how we teach you to effectively trade. His Letter: "I was born in India, Punjab, on November, 08, 1990. My dad was a farmer; he came to United States in 1999. In 2001 me, my mom, brother, and sister came to the United States. I started school in 6th grade. I didn’t know any English a lot of kids made fun of me and I didn’t know how communicate with them. That motivated me to learn English rapidly. As years progressed I learned the language. I started high school in 2004. On my senior year I took a Pharmacy tech course. I completed my pharmacy tech course, got my licensed, and graduated from high school in June, 2008. Right after high school, I was looking for a job as a pharmacy tech. They were paying about $13 dollars an hour. I thought I would save up and look for a business opportunity. I applied at various place but didn’t get any response from any employers, they were all looking for experienced techs. So, I started working at Subway for part time and started college. I saved about $6,000 dollars and I was looking to invest it. " I started searching online for opportunities, while I was doing that, I came across a website that was teaching people how to sell insurance and become an Insurance agent. The fee was $5000 dollars, so I decided to drop college and pursue that career. Andy xxxxx was the fellow, who taught that course. I did some research and started building a relationship with Andy. He really liked me, and he was a good man and still is. I was only 19 years old. While all this is going on, he happened to be starting a company. He wanted me to be part of it and I was really excited and I said yes. The company he started was selling insurance leads to insurance agents. I worked as a Sales rep. Did that for about 4 months wasn’t making and money and the company was failing. He decide to hire a Manger name David xxxxxxxi . I started working with David and built a good relationship. David was a insurance agent as well and on the side he had his own business selling exclusive insurance leads to the top companies who were selling those insurance leads to agents. I wasn’t making any money with the company. David decided to offer me a job. It was from home what I would do was input the insurance leads in the data base of the companies that were selling those leads to the insurance agents. I was making good money about $3,000 dollars a month. I did that for about 7 months. David was also a day trader. He traded crude oil for a living. He got me into trading crude oil. I was really interested and I wanted to do it as well. While I was working for David inputting the insurance leads. He was paying me every 45 days. I trusted him, we had a good relationship and he started teaching me how to trade crude oil. He introduced me to a trading room. I started trading and I lost about $5,000 dollars first. While that happened I talked to David I told him I lost $5000 dollars. He said that’s just the learning huddle. He said he lost about $15,000 dollars when he started. That gave me some hope; I stuck with it and lost another $5000 dollars. While all that is going on David had owed me $8000 dollars. He said he was going pay me the next week and he was going on a vacation for 4th of July. After that day I never heard back from him, he still owes me $8000 dollars till today. I called him, left him voicemail, emails, and still haven’t heard back from till today. Now I’m here writing this letter to you. *What would your Father say about you? My father describes me as a hard worker, responsible, mentally tough, mature, and good money management. If even though I lost a lot of money investing. He still believes i will be successful one day. *What would your Mother say about you? My mother describes me as a loving, caring, takes care of my younger brother and sister. Setting good examples for my brother and sister. *Do you want a physical relationship with a man or a woman? I want a physical relationship with a woman. I am currently single and not looking for a relationship. I think I’m not ready for another relationship. I don’t have the time or the energy. I am really thankful of having a father, mother, brother, sister and my dog to keep me busy right now. *Do you feel denied anything? I don’t feel denied of anything. *If you were seriously going to invest how much money could you manage to obtain, outside of the 2k you have now? If I was seriously going to invest I can manage to obtain whatever I have saved up at the time I am ready to invest. I wish I had more money but I don’t. I can save a lot of money. I don’t like wasting my money on things I don’t need. I don’t go out a lot just because I don’t to want to spend money. If I go out I know I am going to end up spending money. *If you were rich what would you do? If I was rich I would still invest in real estate, business, stocks and etc. I would also give money to charities, help people in need. I rather have a big impact on someone’s like then go spend my money on something I don’t need and make someone a small profit. *What is rich? How much money you make in a year? (What is a lot?) I personally want to be a millionaire first then a billionaire. That’s my goal and a dream. Will I achieve it? I don’t’ know but I will give my 100 percent. I do not want to worry about money, not worrying about paying my bills. Knowing you have a skill to make money anytime. It’s not that I’m greedy I just love watching my account grow. I want to grow my account with smart and sound decisions. *What do you want to be when you are 30 and 40? When I am 30 I want to be successful, hopefully on my way to being a millionaire. I know it’s not that easy to be a millionaire and it’s not going to happen overnight as long as I know I am trying my best at it. I want to get married someday and start a family hopefully when I’m around 30 but I don’t want to get married till I’m not financially satisfied. I want be able to support my family and give my kids a good role model. When I’m 40 hopefully I am a millionaire by then. *Where do you want to live? I want to live here in southern California. I can’t imagine myself moving out of here. I grew up here this is my home. It would be just strange leaving somewhere else. *Who do you hate and why? Who do I hate…..? I don’t hate anyone. If I dislike someone I just completely cut my communications with them and my life goes on. *Who do you tolerate but just barely, and why? I quite don’t understand this question. *Are you worried about your future? Yes, I am worried about my future especially at this point of my life. I think its make or break point of my life. I want to be successful, be able to support my family someday. * Why do you want to trade? As compared to “play the horses”, trade and buy/sell? I want to trade because I am really into it. I am really fascinated by trading. I really want to learn how to trade. I know I will give my 100 percent to learn and get educated about trading. I am willing to do whatever it takes to become a professional trader. I want a skill that I know I can make money anytime and that to me is true freedom. * Do you believe in religion? Which one? How much? How does it influence your life? I do believe in religion. My religion is Sikhism. I grew up with the religion. My parents are very religious we go to temple twice a week, every Wednesday and Sunday. Being a Sikh influenced my beliefs it taught me to help people. We believe there is only one God and all human beings are equal. * If not to above, why? * Do you masturbate? If so, how often a week? If not, why not? I do masturbate about 4-5 times a week. I am still a virgin that’s do to my religion. You’re supposed to be a virgin till marriage. * Are you more attracted to women then men? I am more attracted to women but I would prefer to have men has my friends then women. When you have women as friends it just complicates your friendship with each other. Having male friends I am more comfortable. Having a female companion is a different story. I will have a female companion but male friends. *What is your favorite color? I don’t really have a favorite color. I like anything that goes with the fashion. *When we have a week to do anything, no limit to cost, what would we do, where would we go? If we have a week to do anything and unlimited money. I would go help people in need. I know that today a lot of people live in poverty. What we have Is nothing close to people have in Africa, India, china and etc. I would also help animals in need. A lot of animals are abused, mistreated, and without homes. I want to start an origination with good hearted, genuine people that will help people and animals. In today’s world we need more than one person to make a change. Please answer these questions in as detailed a fashion as you can. I am also enclosing a psychological test. Please complete, score, and send me the results page" AJ utilized a version of a Myers Briggs psychology test that I use and scored a strong ISTJ. ISTJ introverted-sensing-thinking-judging Quiet Serious Practical Dependable Loyal Steadfast Responsible Sensible Patient Conservative Values hard work and honesty What AJ shows me immediately is that has introverted, high work ethic, deep respect and works and thinks. I know already he will be successful and am now ready to start recommending what to do next. Our Core Book Library lisiting on the website lists books Floyd sees as valuable and the first book any of us should read in Tom Dorsey" Point and Figure Charting. For those for more beautiful charts and more deep explanations consider The Definitive Guide to Point and Figure Charting by J. De Plessis. I personally have read Dorsey's book at least 40 times. Much of it is also outlined in the movies in our password protected area. So AJ, you are one wonderful young man with work ethic. I am proud to have you as an immigrant and you are what makes The United States of America. _________________________________ MOVIE COMING THIS WEEK: MORE ON ILLOGICAL LOGIC. We are receiving huge positive feedback on how to learn to argue with the fundamentally illogical. This week we also will be going over a great number of our existing holdings and buys and sells in equities. It has actually been easier to profit on equities than options with this type of volatility. Prepare soon for a shift in Treasuries and some new option plays, and pay particular attention to our stock lessons this morning.

We Don't Have the Capital to Support Capitalism

The first trading day in November the Dow has been down 4 of the last 5 years, but up in 2009. We don't have the capital to support capitalism. So the sovereign debt end of the world players speak, and I predict we will have a euro crisis ( in process) that could and should lead to a United States of Europe. Gerhardt Schroder writes in The Christian Science Monitor that the wold order is so shook now that this is likely to occur. Mr. Schroder is the former Chancellor of Germany, and a member of the Nicolas Bergruen Institute 21st Century Council. This is not JIm Cramer, but someone smart. Done right, Sarah Palin fans, we will become a GLOBAL POWER. Click Here for a listing of a number of his articles and thinking. Cheniere Energy just signed a game-changing deal. On Wednesday, the liquefied natural gas (LNG) terminal operator signed an $8 billion deal with international natural gas giant BG Group. The 20-year agreement includes BG exporting natural gas – from the U.S. to Asia and Europe – through Cheniere's Sabine Pass plant in Louisiana. The Sabine Pass is an 850-acre LNG transportation facility. It has a 40-foot ship canal and five tanks capable of storing over 17 billion cubic feet of natural gas. The facility is 90% owned by Cheniere. It's expected to export LNG oversees by 2015. We would and will hold only CHK (Chesapeake Energy and Cheniere Energy (LNG) in the long run core holding to natural gas. This sector has been flat for all too long. Last week all of you lived to go short. Every day at least 5 to 10 subscribers begged me for a put signal, and begged me to explain WHY the market was going up. Because of the negativity in the world conversely few asked what was going on as the market headed to oblivion a few short weeks ago. We also now have proof the Pee Party came in "representing the people", became Pube Puppets and our Congress remains frozen. They came in naive, all having read the Constitution perhaps once, and all believing in Christianity. Overall there is Dow support at 11,398 and resistance at 12,400 area. Over the long term (6 weeks) we see a bull market, perhaps the top for the year.

The Power of Stupid People

Commentary: NEVER UNDERESTIMATE THE POWER OF STUPID PEOPLE IN LARGE GROUPS. This is one of the most important things I will ever teach you. The History Place - Rise of Hitler: Hitler Runs for President http://www.historyplace.com/worldwar2/riseofhitler/runs.htm This is an interesting article to show you WHY some run for President and why there are certain times in history that someone is elected that it's done on country psychological need, despite the absurdity of the person From MP, again. MP is a trader that fought every part of our system, broke every rule and drove me nuts for several years. He persisted in not following the rules, using his religion in stock trading and has now hit his groove. All of his trading methodology is based on Floydian logic. I'm really proud of him. "Hey brother.. For starters...I want to thank you again for your support and encouragement...our relationship is not only making me a successful trader...but a better husband and Father. I'm learning so much from you and it's all beginning to click.. Last night I sold the Euro Dollar at 1.3790 and bought it back at 1.3740 for a quick 50 pips..and then I began my day by buying the euro dollar at 1.3805 and selling at 1.3890 for a solid 85 pips of profit... You know..Jared Martinez from Market Traders Institute insists that if a person can net average 100 pips of profit per week or 400-500 per month...then he or she can become a millionaire... Since July...I've been averaging 100 pips of profit per week..EASILY.... Now listen....I'm no where close to being a millionaire...but I'm learning the skills to getting there! And much of what you taught me I have applied to the Forex market... _________________________________________ Anyway...I had some errands to run today so I didn't have much time to trade after 10:00-10:30am... But when I saw the DOW hitting 11,760 and the OEX hitting 559 at about 10:15 eastern time...I couldn't resist and bought my Dad the 560 NOV put for 17.40..... I knew this was a key resistance level and I figured she would stall and retrace to at least the 38% fibo level for the day.. If the low of the day for the OEX was 549.83 and the high was 559.14...the 38% fibonocci retracement was roughly 555.60... So I bought the put at 17.40 and used my theoretical pricer on my trading platform to see what my option would be worth if the OEX hit the 38 level at 555.60...I was given a range of about 19.40-19.70 at that level... So I put a sell order in for 19.50 and went out to run errands with my daughters.. Came back 2 hours later and she was easily filled as price because she actually retraced to the 61.8% level...I could have made another 1.00 per contract but seriously? How do you know? I wasn't even home to watch it...So for me the safest play was the 38% retracement level..especially since I couldn't monitor the computer... So once again...thanks to you...I made my Dad 12% on his money in 2 hours...and I was out doing other things! Total winnings on the year are now up to $19,000... I feel as though I've learned a great gift..your patience with me is finally paying off!! Thank you my friend. Enjoy the weekend." Here''s the trigger points for this coming week: http://www.bloomberg.com/markets/economic-calendar/ Here's what the chartists tell us. -- SPY AND DIA MAKE BREAKOUT BIDS -- CONSUMER DISCRETIONARY SECTOR LEADS HIGHER -- STEEL ETF AND AIRLINE ETF FORM FLAG CONSOLIDATIONS -- HOMEBUILDING ETFS GO FROM LAGGARDS TO LEADERS All free governments are managed by the wisdom and folly of people and are far from truly free. We live in a plutocracy, not a democracy. James A. Garfield, 20th President of the U.S. What has stood out most in our successes as a stock and option trading service we'll be repeating again this week, as many of you lost money on sale of "basket stocks" we owned but paralyzed in buying blue chip stocks up and taking back the profits. Study our Dow projections as we've exacted the science of how to trade off the Dow and S/R lines. -- there is a zen to art of trading. Be it.

Illogical Logic

I have steps to our dialogue this week: 1. We are entering our 5th week in the same Dow Cycle. Highs are possible as October ends the Dow's "worst six months" and the "correction" occurred. Doomsayers may go back under the rock for the time. 2. Today is Columbus Day so the banks and government are closed. For those of you with good minds, please piss on them. The rest of us work. http://www.bloomberg.com/markets/economic-calendar/ 3. "Even being right 3 or 4 times out of 10 should yield a person a fortune, if he has the sense to cut his losses quickly on the ventures where he has been wrong." - Bernard Baruch 4. Money was made so many ways last week I'm still surprised. Many traders day traded stocks (such as MP with his wins for his Dad and himself going in and out of just a few stocks), or in retiring 20% in two weeks in a stock recommendation 5. OEX option trading is harder than it has ever been because the swings are so volatile and huge that premiums and erosion planning vanish. Watch all of our signals during this time period and don't be geared just to an option. Volatility is so extreme that we have to use extreme prudence in any trade. 6. "The most successful positions I've taken have been those about which I've been most nervous, but ignored the emotion. Courage is not about begin fearless; courage is about acting appropriately even when you are fearful." - Daniel Turov 7. I have learned in trading commodities, or cash derivatives, that the law of supply and demand is first led by the law of cause and effect, not the usual reverse, and commodity futures are more on "money" than supply and demand. 8. Nenner believes that Gold cold reach 1700 and Silver 34.00 yet still be in a corrective cycle. Cycles bottom by the end of October. 9. Oil may continue to rally as long as we don't have a close below 81.00 10. I believe we are at or near the bottom of this cycle. It appears we've bottomed but we'll watch a day or two and then continue building long positions. As you know Floyd has been buying equities in our existing portfolio for the last 1000 points of drop, insistent the market is being manipulated for short term gain and political plays on the parts of the Pubes. For those of you not clear on Pubes it is my nasty name for pubic hair Republicans that are acting as our leaders. I'm embarrassed right now to be an American, and I do not believe we the either the most powerful country, nor the greatest, on earth. Our hubris amazes me. 11. Natural gas continues a flat cycle. We still like CHK as a good long term Natural Gas play with a CEO that buys into his business and runs it like a complete crook. Chesapeake has a good long term cycle to it. I spent the last two weeks on a great experiment in psychology, human nature and the character-ology of the personality type that "must be right" and to "win" uses a form of logic that is indisputable. I believe this form of logic so frightening, maddening, and damaging that I've been commissioned as a consultant to prepare a study on this type of argument, and I'm beginning an article and lecture series on how "those that must win" (evangelical Bible Thumpers are a perfect example) use a form of logic within their verbal or written argument to you that makes it impossible to respond. It's called Illogical Logic. You'll see several movies on this over the week as its' a clear way how to beat yourself, and beat the market. _____________________________________ Floyd's Favorite FAQ of the week: "Everything I read on CNBC and in the news shares that the market has no financial strength and that Obama's debt will take the stock market down Why should I trade?" 2/3 of the sovereign debt increases that have occurred since 1960 were signed in by Pube Presidents. 71% of the current U.S. debt was accumulated by George W. Bush. It is rumored that George is now reading every day. He told 60 minutes last month that he reads the Wall Street Journal. Wow. HIs skills are up, he is reading, but it's Murdoch lies. If one adds amortized debt for increases in existing, NOT NEW, government issues the debt that Obama inherited was 81.3% of our overall debt. The reader is being influenced by illogical logic. Take prudent risk Last but not least I am getting ready right now to BRIBE you. Please be open. For four years our little company of myself, daughter Jenn, the apprentice, and Terry Brown, my partner and webmaster have managed to build one of the top ten Readers's Choice Option Advisory Services (2008 thru 2011) and it's my proudest personal achievement. It is for three reasons: 1. Dad is long gone but he would have been proud 2. We started with nothing and have built this ourselves 3. Traders world wide compliment the unique style and methodology we use. So here's my bribe: -Read the attachment that came that offers you a one year FREE subscription to Stocks and Commodities Magazine merely for subscribing to OEX Options. For those of you that are already paying (not on trials) subscribers your subscriptions are on order and you'll be receiving notification shortly. If you already subscribe I'm sure Stocks and Commodiites will combine your subscriptions. -Find your customer # of the magazine and help to vote OEX in as one of the top ten Readers Choice Options Trading Systems. Here's how: 1. Go to http://traders.com 2. Top right there is a box that says 2012 Readers Choice Awards 3. Sign in and enter your new subscription # and last name. 4. The group Options Trading systems is on page 4 of their website. Vote for us! 5. And finally, don't forget, go page 5 and hit submit! SUCCESS! You have really done all of us a favor and you have been bribed. Better yet you get a full year subscription to the best trade magazine Stocks and Commodities in the industry! PLEASE DON'T FORGET TO HELP US. VOTE!! DEADLINE IS DECEMBER 31ST, 2011

Question All Authority

Commentary: Please log-in to view the movie on the website today for a verbal update on this weekly commentary. And also do the following three things, to learn stock market success: 1. Question all authority. 2. Question all government, voting facts, and corporate facts. Most are lies. 3. Distrust anyone that believes it is harmful to them to let others have more. These are people that have not learned what humanity is. You have no time for them. The chartist point of view: -- OVERSOLD GERMAN STOCKS ARE TRYING TO STABILIZE -- GERMAN ISHARES ARE ALSO TESTING SUPPORT AT THEIR 2010 LOWS -- FOREIGN ETFS INCORPORATE DOLLAR TRENDS AND, IN MY VIEW, ARE BETTER TO CHART -- NASDAQ COMPOSITE STALLS AT 2600 RESISTANCE -- AN OCTOBER DROP COULD LEAD TO MARKET BOTTOM -- FALLING RATES AND RISING VIX ARE HELPING UTILITIES Real Facts: This is my anger and the point of the dialogue we will create this week about illogical logic. This occurs when you are arguing with someone that argues illogically; in the end, you are bound to lose 71% of the current U S debt was accumulated during Republican presidential terms. 2/3 of sovereign debt increases have been signed into debt by Republicans since 1960 In 1961 the average American corporation paid in 40.5% in taxes vs. 10.5% in 2011. These are examples to show you how you have been mis-led, and how you begin to believe the misleading as the fact when it is the reverse. Another example is to see the illogical person take the real fact and when answering it change the subject. This is called Illogical logic and is an article I'm preparing to share with all of you this week, that I use in my consulting practice. Read this carefully. This is after eight years of Bush creating "Leave no Child a Dime". Ask a teacher what they think is going on with our educational system. In Texas we have re-written the history books already to make it all look good. I am trying to show fair perspective but here's a quote to show just how fucked up we are. I will bet that 98% of the U.S. does not even know what quantitative means or is, and 1% misunderstand it. From an economic standpoint I have seen no other point of view or plan that resolves a forty year problem. Further, from the Pubes or Pea Partiers, I hear nothing. They have told me clearly, and you too, all we are doing wrong. I have yet to see any portion of any plan, of any response. Answering "getting out of debt" is tough for me when they accumulated 71% of it. Here's a sad story: The question was What is an American? The correct and only correct answer is: Someone with a green visa card up to date, a passport, and citizenry in either the U.S. or its territories or Canada. Below I've read a typical "OMG" email. The rest of the linked in group seemed to forget that there is a South, Central and Latin America. When reminded they "did not see this part of the world as "the question asked) WTF) or better, "people all over the world see Americans as U.S. citizens. They do not think of Canada or the other countries. WTF? These people are allowed to vote? LinkedIn Groups... Group: Leadership Think Tank Discussion: Define What is an American. A USA american is the sucker who will never have the retirement or any other benefits he was promised his entire working life. He is being cheatred out of them by the very polititions he elected to protect and serve him. They have been paid too much graft for the last 100 years to care at all of the people who put them in power these warnings were even made public in the 1930,s by Jimmy Stewart. Today your future is being stolen from you by devalueing the country thru this new thing called Quantitative easing which is stealing your savings and purchasing power as fast as it can, not only in US but Europe as well. The major american corperation that has stolen the very life blood of that once great country now reside worldwide keeping their ever growing assets outside the country that nurtured their growth and they bled to it's last breadth. I truly feel sorry for americans for they are too stupid to even know what is happening to them. Floyd: this is illogical logic. There is no proof, validation, or economic back up. Just a theory. And he blames the politicians. Please remember it is YOU as an American that voted for George Bush twice. I blame Americans, not politicians. We are what we decide. We are close to doing the same thing again. This man blames "who" for this. He has no idea that the banks almost all closed the first week of Obama being in office. Long after Paulson had given his friends all the 785 billion FAST before the term was up. For those of you that would like to get past lobbying and want the tax answer: legalize pot. Read more at http://bit.ly/mOQGZ6 This is reverse logic. The liquor companies lobby against this, as do the "religious right". We miss a mighty tax revenue in the name of absolutism and prohibition which of course fails -- STOCKS SHOW LOTS OF MOVEMENT AND NO REAL CHANGE -- DECLINE IN ADX REFLECTS LACK OF TREND IN SPY -- XLK AND XLY FAIL AT KEY RETRACEMENTS -- RETAILERS HOLD THE KEY TO XLY -- NYSE AD VOLUME LINE BREAKS AUGUST LOW -- AROON DOWN TRIGGERS BEARISH SIGNAL IN NY COMPOSITE

A Love Letter

The week after September triple witching the Dow has been down 16 of the last 20; this could be proven true as we reached market tops Friday and hesitated OR could be a good trick to see the market fool us and hit new highs before correcting. To all those telling me that the USD was being ruined by President Obama please stick your fingers in your mouth and go back to economics school. The USD is only one method of currency, and all currencies change value throughout time, including Gold and Silver. 2 out of 3 of the debt ceiling elevations that have been signed into law by Republicans have been 2 out of 3. Funny how what is happening now is SO different. Another incredibly profitable OEX week. As always, when I pick so well for an extended period of time I become much more prudent and risk conscious. The market will also beat you; not you the market. It is what it is teaching you. Economic Calendar: The FOMC talks this week http://www.bloomberg.com/markets/economic-calendar/ The chartists comment on last week: -- CONSUMER DISCRETIONARY SPDR RUNS INTO RESISTANCE -- NASDAQ AD LINE HITS NEW LOW AS NYSE AD LINE BOUNCES -- BIG TECHS LIFT NASDAQ AD VOLUME LINE -- BANKS WEIGH ON NYSE AD VOLUME LINE -- CUMULATIVE NET NEW HIGHS LINES REMAIN WEAK Track Record Three Weeks: We have had only one losing trade in three weeks on the OEX. Many traders have been able to trade two or three times a day. We have traded contrarian to the market most of this time. Friday ended right at our resistance line of 12,540 with many subscribers to now "reverse" and make money as the market corrects. Greed is a flag here, as we read Dow projections and note that there is possibility of more upside, and the U.S. seems a bit less concerned about the Euro, for the moment. A serious love letter and what it means to you: "First off I want to apologize for the length of my letter, I just felt very compelled to write to you. I have been trading since the early 90s - at times very much full-time, and at times very sporadically. I've lost my shirt. I've had moments of wonderful success, only to give it back again. I have spent tens of thousands of dollars on training. I even started to look at my emotions, but ultimately couldn't get passed the fear and greed, glued to my screen tick-by-tick, even if my trades were position trades. In parallel, I have been on a spiritual journey for as long as I can remember (who isn't ultimately). But at some point I began to experience a deep shift. I began toexperience - and therefore know deep down - that I am the creator of my reality. Not an influencer...not a mere participant...but the direct creator of my experience. And the more I "clean" beliefs and emotions that no longer server me, the more I experience what I truly want. And this is how I re-connected with you and your extraordinary work. I say "re-connected" because I was an OEX Options subscriber a few years ago, but was still so deep in unconscious / emotionally-driven creation that I just didn't see the wisdom of your work. I was a subscriber for probably a month or two. But I re-connected with your service after a series of contemplations on freedom, ease and abundance: how to live my life in great abundance, great freedom, great joy. And your face popped up in my consciousness. I immediately searched my email archives (I no longer wait when I have such insights), signed up for your free trial and started trading on a virtual account (I don't have a dime to trade with at the moment). I can hardly believe the result: not only have I increased my $1M+ virtual portfolio by 40% in just over 2 weeks, but more importantly, I have accomplished this in virtual calmness. And the rare moments of fear and greed were met with a keen realization that these feelings no longer serve me: they are opportunities to further embrace and clean my negative emotions. I always had the hope that I could make a living trading...now I know it's absolutely possible, especially with the wisdom you offer. I know that with you trading can be as much a spiritual journey as a material celebration of our divine nature. I no longer separate these two "realms" and I have chosen to consciously live out my life this way. The funny thing is that I recently stated out loud that I wanted to meet individuals who consciously embraced this point of view. When I watched your introductory video on your homepage, I smiled broadly when you said that you are a zen buddhist. I knew then that my re-connecting with you was a direct answer to my request. Every moment of everyday I now focus on the following vision: I AM trading a $100,000 account, easily living off a portion of this steadily growing trading account. I see myself as an apprentice in your advanced mentoring program, continuing my journey to learn about myself and grow as the creator that I AM. I see this vision manifesting immediately. I am honoured to have come to discover you and your work, and I look forward to continuing my journey with you." Very Sincerely, Marc-Elliott XXXXXXXXX I share with pride the letter from Marc-Elliott XXXX as it is why I am here. I do not need to have this service to make money. Many of you must wonder that? If he's so good why does he teach others and not just get rich? For other services I can't speak, and it's why our service is really geared to floor and market maker traders blended with the new trader because my perspective is unique in the market. I want to teach, to show that a rock is not hard, that we only know what we know, that we are lied to more than told the truth by all authority, and that organized religion should be immediately distrusted. My goal is to see you "beat yourself' as the game is not about how much you know about a stock or option, but how much you know about you.

Jefferson Was a Ponzi Schemer

Commentary: I have much to comment on and share, as I think we are at a pivotal point in the market and the world. As not much is truly 'in order", neither are my first stream of consciousness trader thoughts to you: We are becoming manics. The input is overwhelming us. The url link is a long and scholarly article that I will not decipher for you; I believe it important you find your own conclusions. MAGAZINE | August 21, 2011 Do You Suffer From Decision Fatigue? By JOHN TIERNEY The very act of making decisions depletes our ability to make them well. So how do we navigate a world of endless choice? Copyright 2011 The New York Times Company | Privacy Policy Each week another trigger catapults us directionally, but with such a magnetic changing bias the argument for more downside becomes clear to the doomsday's, and the bulls continue to think we have one of the best equity buying times since World War II and that equities will outpace bonds in a growth period, long lasting enough just to make everyone think it is all fine. And then a massive market crash. That's one theory. But another theory, which I've heard ad nauseum from many of you is the USD had become powerless under Obama and the USD had become worthless. During which time I tried to teach: a. No currency is real or lasting, any valuation of emotion can change. The USD did not demise under Obama, Bush had done a fine job destroying the dollar earlier, and it's part of our economic crisis. And, to the doomsayers sharing with me there would be one world currency (there might be, and the Euro may fall), and the USD would not be it !!!!, well, okay, it doesn't really matter, but the USD is at all time highs. All the dooms day false facts I have heard thrown, may I throw right back. Our worthless dollar is the most valued of instruments. Question Authority. b. The USD is only a derivative instrument and the value of any "paper currency", product, or "gold", is really just what the public will pay for it. c. It is meaningless, unless a derivative trader, to even care what currency leads, as long as one knows which will lead. We care about valuations and our ability to buy, spend, and borrow, NOT about who is the most powerful (Russia). ___________ I constantly refer to false facts. As you review the Dow projections above here's a fact that will help us understand what I call "illogical logic". in 2008 the Dow lost 504 points before the Triple witching of that week. Now 500 points seems nothing; but make note Friday is triple witching expiry Everyone loves Thomas Jefferson, the great statesman. Please do your history to learn the real facts, but : "banking establishments are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling on a larger scale. Jefferson began banking in the U.S. and was a Ponzi schemer. Check the facts. Not the glorified history books.

I Made Money

"Hi Floyd,
I made money on a signal you gave EVERY day last week on the OEX, averaging 21 to 36%. I additionally made 28% on my sale again of the October GLD call, and sold out all my long term treasuries for an overall 18% return, principal increase by price and interest rate.
I did almost the same with you last week and have made money consistently with you after 60 months of Advanced Mentoring.

At the beginning of Advanced Mentoring I screwed up and started trading and I did not trade the bias you told me, wrong as I thought it was, but traded the bias I heard from Kramer, CNBC, and in the news. I lost 36k, and this is when I joined Advanced Mentoring.

My investment in Advanced Mentoring (http://www.oexoptions.com/AdvancedMentoring/AM.html) shocked me, as it is expensive and you are very blunt, very focused, and are a clearly liberal and argumentative. You have not made me a cynic, nor do I think you are, but I you have made me learn to the core of my being where I have been falsely taught all of these years. There is no doubt for why you and your company are so well known.
You teach, care, and focus me. I am proud to be your student."

George J, Seattle, Wa"

_________________________________

I teach trading stocks and options so that I may teach myself each day what I have already learned, but could easily forget. This daily alert is how I trade stocks, options, currencies, and "think about the market."
I teach because I am a psychologist and enjoy seeing the human mind open up.
I teach because it stops me from making my own mistakes.
That should answer: Why do I trade?


"Make sure you have a jester because people in high places are seldom told the truth." - Radio caller to President George Bush.
I am that jester. You need me to help you see where you are lied to and how gullibility is so easily spread in the Murdoch nation.
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The day after Labor Day historically the Dow has been UP 13 of the last 16, with major jumps in 1997 and 1998.

Gold At an Edge

Things look better, the market began to rebound, and we were able to profit EVERY day on our call recommendations this week. Gold also hit the sweet spot twice and we were able to profit 40 to 50% on the same October Gold option in a 7 day period.

We see so many intraday reversals, all on "trigger news:" short term cycles may be up but we see a long term count, or cycle showing weekly cycles bottoming in October.

This means the "upside" we had from our shellacking this past month will only bring us the same old highs, and not near the highs we had reached.

Gold we see as "at an edge." As long as it doesn't close below 1736 (note close, not intraday swings) and if silver does not close below 39.40 precious metals are still in full gun and spirit and we don see any "top" being reach until perhaps the third week in September.

Our theoretical Dow projections were so uncanny this week that we hit almost each support and resistance line, and traders were able to make a living all week trading our OEX symbol or a stock. Remember, Dow projections work for the whole market and our pivot point calculators provided to you also work perfectly in short term or day trading a stock.

Study only a few stocks, no more than 50. Become expert at fewer than ten. This is pure Wyckoff, and we as traders seem unable to stop reading of new "great trades," or earnings reports.

if you have not learned by now that financial statements and earnings reports, audits and financial reviews can and often are completely falsified you have missed it all.

But how the stock is doing to me, or even what the stock is, is far less important ( as are most of the technicals) than the PNF on the chart and the long term cycle.

Ex: Oil looks on a downward cycle in down until November or early December according to the cycles. We would be testing lows at 82.20.

XOM is, as an example, only a few weeks from being a nice long term buy that we later buy options on.

Currency traders: we are often playing the Euro in Advanced Mentoring, and we are just beginning to follow more the Canadian dollar; we may be in a position to go long on this currency within weeks.

News Triggers

*Historically the end of August has been stronger the last 7 years.

*Grundy said, "A small businessman is one whose business is not a "successful one".

*When everybody thinks alike, everyone is likely to be wrong

Let's start with a PNF chartist showing us how he sees what could have been our lowest low, or could be,and whether it is over or not".

Hello Floyd, the lowest we can take the weekly percentage P & F chart on StockCharts is .31% i know its hindsight but there what looks to be a fairly strong S & R back in April at the 10856-10590 area... Can look to at that and let me know your thoughts.. I feel if that bring down the weekly chart to the lowest percentage might give us stronger S and R lines compared to the Daily... See attached and let me know your thoughts...
-Thank you Derek


Effectively Derek has taught himself the Fibonacci retracement, in which we went to the lowest levels, something few of us thought, and brought up back, short term or not, to our 2008 lows.

There is something very wrong with our financial thinking and pledges when the market came from where it did to where it went. What is inherently different three months ago than today?

What news triggers OR market movers influence the market and we don't seem to even know it, or it happens faster than we can see, we are entering a new era.

We lead this week's commentary with two jobs:

1. Updating our charts to sold what sold at trailing stop loss.

2. Listing Dow Charts in PNF format, attached, to help you see where the market is.

Let's do that after this debacle before we even begin to analyze why.

I am surprisingly succinct and it's because I want a few more days of absorption; there is much on why our world economy is as it is, and solutions that are not just Keynesian.

When Michelle Bachmann is really a front runner I am now watching the news in almost a study of belief that she could even be considered. The plan is in place, the conspiracists say, as any President can be a puppet.

We will be much more detailed in thought to you this week when necessary.

Reader Disgust Series

Commentary: Each week I try to pull a Reader Disgust series of articles. I pull these to read not to make any point, or to hone in, but to provide focus on reality. More and more our world lives in a sense of unreality. These articles are an important part of our commentary. As each Monday we send a more lengthy alert and commentary for the week the articles we pick are not filler, or just there to fill space. They are part of what I write.

THE RICH GET RICHER
http://www.huffingtonpost.com/2011/08/04/irs-incomes_n_918458.html

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Even though 7 trillion in wealth has vanished because of the housing collapse, we see further declines ahead. The Bernanke Bubble, as we used to call it, began around 1997; thusly prices could fall to 1997 records, another 30 or 40%.

If we examine the demographic situation, we can clearly see that the baby boomers, born between 1037 and 1961, have moved beyond their peak spending years of 46 to 50. They are no longer buying big cars, furniture, and exuberant Chinese drywall McMansions. And because of a birth rate from 1961-1981, the human beings who normally would be the buyers of the McMansions simply do not exist.

Not until 2023 should we truly see a low in U.S. real estate, as real estate seems to follow a clear 17 year old cycle. 2006+17=2023

What we are witnessing is nothing more than a generational shift in spending. The credit collapse will continue, as less spending by baby boomers means less demand and less demand means deflation.

I take this even further thinking the DEBT debacle merely exposed what has been going on nation by nation, all over the world, over the past 50 years; Keynesian economics is simple. Make more than you spend and you can borrow up to your ass. And it's what has been done.

He's also right: "stop revenue so that it exceeds projected debt and earnings" and debt will begin a cyclical decline that will only be righted by either "write off" or increase in earnings.

Why this country does not put WPA programs in, and who is stopping it (assuredly it is being leveraged out) astounds me. Simply use the government dollars to create jobs, "fix America", help us feel like a team and produce enough revenue to allow no debt ceiling.

Double whopper please, extra cheese.

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99% of all analysts, traders, quantitative projections and stock technicians did not "catch" that the knife was gong to fall.
Many of us for months have said things about needs for change or improvement, but it was while Buffet was actually speaking and sharing the equity market was safe, and a bargain (and he's right) that the market fell another 500 points.

You don't need the history. More of our blood was spilled buying and selling stocks and bonds than ever before

________________________________________________________________________

You also do not need the facts of how fast, how deep, and ugly it was, but here's a few more pieces of Reader's Disgust to help you fathom:

1. There is a reason that Congress is paralyzed. You'll read my opinions later
Bernanke Seizes Day to Lower Bond Yields as Congress Shirks

Aug. 12 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke’s flattening of bond yields may be just the push investors and companies need to take risks with their cash.

The Fed’s decision this week to keep its benchmark interest rate near zero through mid-2013 sent five-year Treasury yields as low as 0.82 percent, below the 2.21 percent two-year rate before the collapse of Lehman Brothers Holdings Inc. in 2008. Lower returns on the safest investments will spur equities purchases, said David Kelly of JPMorgan Funds.

“The Fed’s making it extremely painful not to take on some risk,” said Kelly, who helps oversee $408 billion as chief market strategist for the New York-based firm. “People will tend to push money into equities.”

Bernanke and his colleagues acted days after a deal to raise the debt ceiling and reduce federal budget deficits failed to avert a cut to the nation’s AAA credit rating by Standard & Poor’s. The central bank’s decision, and a signal it’s willing to take further action, helped spur a rally in U.S. stocks from an 11-month low.

“This is aimed at encouraging people to leverage up, with the knowledge that their borrowing costs will likely be very low for a long period of time,” said Lou Crandall, chief economist at Wrightson ICAP LLC in Jersey City, New Jersey.

The Standard & Poor’s 500 Index rose 0.5 percent to 1,178.81 in New York today, extending yesterday’s 4.6 percent gain.

Declining returns on savings accounts and certificates of deposit may encourage consumers and corporations that have been hoarding cash to start investing it, JPMorgan’s Kelly said.

Buying Back Stock

“The lower yields are, the more these companies are going to have an incentive to either invest directly in the stock market or even simpler, just buy back their own stock,” he said. “The incentive for a clear-thinking CEO must be huge.”

Companies stockpiled a record $1.9 trillion in cash in the first three months of 2011, according to the Fed data from June. Bank of New York Mellon, the world’s largest custodial bank, said Aug. 4 it will begin to charge institutional clients for “extraordinarily high” cash deposits to stem a flight of capital into the safety of bank deposits.

Americans saved 5.4 percent of their disposable income in June, the Commerce Department said this month. That’s up from a 5 percent rate in May and is the highest since September 2010. It was 1.5 percent in 2005, the lowest since at least 1959, amid the housing boom and 3.1 percent economic growth.

Certificates of Deposit

Savers are getting average interest rates on 6-month certificates of deposit this week of 0.58 percent nationwide, down from 0.60 percent last week, according to Bankrate.com. Rates on one-year CDs fell this week to 0.86 percent, while 5- year CDs fetched 2.04 percent.

The Fed said it would keep its target for overnight loans among banks at a record low for at least two years to support a recovery that’s “considerably slower” than anticipated.

Two-year Treasury yields have become the equivalent of short-term bills, with rates declining to 0.187 percent, about the same as the average yield on three-month bills over the past three years.

“The Fed has vindicated its power over the term structure of interest rates by being clear about the expected path of short-term rates,” said Peter Fisher, head of fixed income at BlackRock Inc., the world’s biggest asset management firm, who was markets chief at the Federal Reserve Bank of New York from 1994 to 2001. “It does encourage those looking for returns to look in credit assets and then further out the yield curve.”

Yields on investment-grade corporate debt average 2.01 percentage points higher than comparable Treasuries, according to data from Bank of America Merrill Lynch.

Operation Twist

The Fed’s action is reminiscent of a joint action with the Treasury Department known as Operation Twist intended to pull the nation out of a recession in 1960-1961. The Fed purchased longer-dated Treasury bonds and sold short-term bills in a bid to flatten the yield curve.

One difference, according to Fisher: Bernanke is trying to create very low short-term rates, while Operation Twist was focused on reducing longer-term borrowing costs.

The Fed’s action this week may also have another purpose, said Marvin Goodfriend, an economics professor at Carnegie Mellon University in Pittsburgh.

“It is mainly a signal that the Fed will do more, including buying government bonds, if the Fed believes the economy needs it,” said Goodfriend, a former research director at the Richmond Fed. The Fed in June ended a $600 billion bond- purchase program.

2. The swings took place for hedge and money market makers and was part of a conspiracy to prove the Democrats are incapable. We believe it was manipulated.
U.S. Stocks Slide for Third Week on Concern Over Europe, Economy

Aug. 13 (Bloomberg) -- U.S. stocks fell for a third straight week, including the biggest one-day drop since 2008, as Standard & Poor’s reduction of the nation’s credit rating and Europe’s debt crisis fueled concern the economy will falter.

The S&P 500 pared its slump in the last two days of the week as government data showed jobless claims unexpectedly decreased and retail sales improved. Bank of America Corp. plunged 12 percent, the worst performing stock in the Dow Jones Industrial Average. Walt Disney Co. sank 5.9 percent after posting disappointing third-quarter studio revenue. For-profit educator DeVry Inc. lost 23 percent, the largest drop in the S&P 500, after it said new undergraduate enrollment fell.

The S&P 500 lost 1.7 percent to 1,178.81 in the five days ended Aug. 12, capping a week of record swings. The Dow fell 175.59 points, or 1.5 percent, to 11,269.02. Both gauges have fallen for three straight weeks.

“Investors are going to have to get accustomed to above- normal volatility,” Leo Grohowski, chief investment officer for BNY Mellon Wealth Management in Boston, said in a telephone interview. The firm oversees $171 billion. “Economic uncertainty is going to continue to outweigh the good news from company fundamentals. We’re all hostage to the news flow out.”

About $6.8 trillion was wiped off the value of global equity markets from July 26 through Aug. 11 as Europe’s debt crisis deepened and investors speculated the economy may contract. The swings in U.S. equities this week were unprecedented in the history of the American stock market, according to data compiled by Birinyi Associates Inc., Bloomberg and Howard Silverblatt, senior index analyst at S&P.

Record Swings

The S&P 500 plunged 6.7 percent on Aug. 8, its biggest slump since December 2008, in the first trading session after the U.S. was stripped of its AAA credit rating at S&P. The index rebounded 4.7 percent the next day after the Federal Reserve said it will leave its benchmark interest rate at a record low through at least the middle of 2013. The gauge then fell 4.4 percent on Aug. 10 and rebounded 4.6 percent the next day.

Never before has the S&P 500 reversed moves that large in each session over a four-day period, the data show. This week’s trading also marked the first time the Dow moved more than 400 points either up or down for four days in a row.

“This week was unnerving,” said Channing Smith, a money manager at Capital Advisors in Tulsa, Oklahoma. The firm manages $920 million. “The large price swings are indicative of uncertainty in the markets, but we haven’t panicked. Our clients haven’t panicked. We used the market sell-off to go in and buy high-quality stocks. The economy is very sluggish and growth is below-trend but it’s still positive.”

Losses Pared

The S&P 500 rallied 5.2 percent in the final two days of the week, its biggest back-to-back gain since March 2009, as economic reports showed first-time applications for jobless benefits decreased 7,000 in the week ended Aug. 6 and retail sales increased the most in fourth months.

The Chicago Board Options Exchange Volatility Index, which is known as the VIX and measures the cost of using options as insurance against declines in the S&P 500, climbed 14 percent to 36.36 this week. The index surged 50 percent on Aug. 8, its biggest one-day gain since February 2007.

The rout in global markets spurred some Wall Street strategists and investors to revise their outlooks on equities and the economic recovery. Goldman Sachs Group Inc. cut its 2011 target for the S&P 500 on Aug. 5, while Laszlo Birinyi, one of the first investors to recommend buying when the bull market began in 2009, said his forecast for the benchmark equity index was “shaky.”

‘Uncertainty and Fear’

David Kostin, the New York-based equity strategist at Goldman, lowered his estimate for the S&P 500 to 1,400 at year end from 1,450. “Uncertainty and fear trump fundamentals and valuations,” Kostin wrote in a note. He said a recession is not “the most probable outcome in 2012.”

Birinyi, of Westport, Connecticut-based research firm Birinyi Associates Inc., wrote in an Aug. 9 note, “The bull market is intact, and while our ‘target’ of 1,450 in mid-2012 is admittedly a bit shaky, our more important conclusion that a rational, disciplined portfolio can attain a 10 percent plus return in 2011 is not.”

Birinyi also said financial companies are unlikely to outperform as the rally continues. Bank shares declined the most out of 24 groups in the S&P 500 this week, losing 1.6 percent, amid concern the European sovereign-debt crisis will threaten profits.

Banks Slump

Bank of America sank 12 percent to $7.19. American International Group Inc. disclosed plans this week to sue the Charlotte, North Carolina-based bank over allegedly faulty mortgages. The firm’s plunge in share prices over the past week stoked concern it may need to raise capital. Chief Executive Officer Brian T. Moynihan said on a conference call hosted by mutual fund manager Bruce Berkowitz that the biggest U.S. lender is being buoyed by conditions that are better than they’ve been since the credit crisis.

Citigroup Inc. retreated 11 percent to $29.85. JPMorgan Chase & Co. slumped 4.5 percent to $35.91. American Express Co. lost 4.9 percent to $44.89. Comerica Inc. decreased 16 percent to $24.41, the second-biggest decline in the S&P 500 this week.

Disney, the world’s largest theme-park company, slid 5.9 percent to $33.09 amid concern that slowing consumer spending and rising costs at the ESPN sports network may crimp profit growth. The Burbank, California-based company posted third- quarter studio revenue of $1.62 billion, compared with the average analyst estimate of $1.83 billion.

DeVry, AOL

DeVry Inc. fell 23 percent to $44.49. New summer enrollment dropped 26 percent to 15,566 from 20,935 a year earlier, the Downers Grove, Illinois-based company said.

AOL Inc. tumbled 27 percent, the most since it was spun off from Time Warner Inc. in November 2009, to $11.78. The Internet company reported on Aug. 9 a second-quarter loss and an 8.4 percent drop in sales. The New York-based company trimmed its weekly loss two days later, rising 12 percent, after announcing it authorized a $250 million stock buyback.

Speculation the economic slowdown will worsen has overshadowed better-than-estimated profit by companies. Per- share earnings increased 17 percent among the S&P 500 companies that have released quarterly results since July 11, according to data compiled by Bloomberg. About three-quarters of the companies have topped the average analyst profit forecast, the data show.

Cisco Systems Inc. rallied 7 percent to $15.99, the biggest jump in the Dow. The world’s biggest maker of networking equipment reported profit was 40 cents a share in the fiscal fourth quarter, beating the 38-cent average estimate by analysts, according to Bloomberg data.

“This is an exceptional buying opportunity for U.S. equities,” Barry Knapp, the New York-based head of U.S. equity strategy at Barclays Plc, said on a conference call this week. “The incoming data is going to be better, which is going to serve to stabilize the macroeconomic outlook and set the stage for a reversal in equity markets.”

3. S & P lowers our rating, others don't, and now is analyzing their analysis. This was purposed histrionics and pandemonium.
SEC Said to Scrutinize S&P Math, Possible Leaks of U.S. Rating

Aug. 13 (Bloomberg) -- The Securities and Exchange Commission is reviewing the method Standard & Poor’s used to cut the U.S.’s credit rating and whether the firm properly protected the confidential decision, according to a person with direct knowledge of the matter.

SEC inspectors are examining S&P’s policies for conducting such analyses and whether those procedures were followed when the New York-based firm downgraded the U.S.’s credit rating Aug. 5, said the person, who declined to be identified because the inquiry isn’t public.

S&P’s downgrade of the U.S. for the first time triggered an equity rout that wiped about $6.8 trillion from the value of global stocks from July 26 to Aug. 11. U.S. officials have said the downgrade was based on a flawed analysis which overstated U.S. debt by about $2 trillion, while S&P said the discrepancy doesn’t change projections that the U.S. debt-to-gross domestic product ratio will probably continue to rise in the next decade.

The rating company lowered the nation’s AAA grade to AA+ after warning on July 14 that it would reduce the ranking in the absence of a credible plan to decrease deficits even if the nation’s $14.3 trillion debt limit were lifted.

The decision was at odds with the other two main ratings companies, Moody’s Investors Service and Fitch Ratings, which both said the U.S. continues to deserve the top credit rating.

Possible Leaks

SEC staff are also looking into whether certain market participants learned of the downgrade before its announcement. The inquiry, which is in preliminary stages, may not result in a referral to the SEC’s enforcement division, the person said.

Ed Sweeney, an S&P spokesman, said the firm doesn’t discuss specific interactions it has with regulators.

“S&P takes its confidential information and securities trading policies, and the related securities regulation, very seriously,” Sweeney said in a statement. “Our policies prohibit analysts or rating committee members from trading and holding securities or options of the companies or governments they rate.”

Sweeney said the firm has “long-standing policies and procedures in place” to protect confidential information. Sweeney also said the firm had previously indicated in a July statement that there was a chance of a downgrade.

S&P “published several reports and broadly communicated our views regarding the potential impact on other fixed-income securities,” the statement said.

‘Market Turmoil’

The rating downgrade added to concern about prospects for the global economy as Europe’s debt crisis deepened. U.S. stocks fell for a third straight week, with the S&P 500 losing 1.7 percent to 1,178.81 in the five days ended Aug. 12, capping a week of record swings.

Treasuries rose, with ten-year yields falling as much as 52 basis points this week, the most since December 2008, and signaling the lower rating hasn’t reduced confidence in the nation’s creditworthiness. The yield declined nine basis points to 2.26 percent as of 5:02 p.m. yesterday in New York, according to Bloomberg Bond Trader prices.

The downgrade followed an Aug. 2 agreement among U.S. lawmakers to raise the nation’s debt ceiling and put in place a plan to enforce $2.4 trillion in spending reductions over the next 10 years, less than the $4 trillion that S&P had said it preferred. The political wrangling that preceded the debt pact was also a concern, S&P said.

The “debate this year has highlighted a degree of uncertainty over the political policymaking process which we think is incompatible with the AAA rating,” S&P analyst David Beers said on an Aug. 6 conference call with reporters.

‘Quadruple A’

Former Treasury Secretary Henry Paulson said he would invest in U.S. government securities before other sovereign debt even though the nation’s political process isn’t working as well as it could be.

“Our political process, our government, hasn’t been working at a AAA level,” Paulson, 65, said on Aug. 11. “I would take U.S. Treasuries over other sovereign debt, other AAA sovereign debt, any day of the week. That’s not to say we don’t have important issues to deal with in this country.”

Warren Buffett also criticized the rating company’s decision, saying the U.S. merits a “quadruple A” rating, in an interview with Betty Liu of Bloomberg Television.

‘Some Spine’

Bill Gross, manager of the world’s biggest bond mutual fund, said on Aug. 7 that S&P “demonstrated some spine.” The manager of Pimco Total Return Fund has said that Treasuries are unattractive because yields don’t offer enough compensation for the risk of inflation.

Still, U.S. bonds remain in demand at a time when Europe’s sovereign debt crisis threatens to spread to Italy and Spain from Greece, Ireland and Portugal. The Treasury’s Aug. 9 auction of $32 billion in three-year notes attracted $3.29 in bids for each dollar of debt sold. Indirect bidders, the class that includes foreign central banks, bought 47.9 percent of the issue, the most since May 2010.

4. The European debt crisis, and the devaluing of currencies, has the pee partiers thinking our "sovereign debt" is some big deal (it is only if use it against ourselves), yet we buy Gold and Silver and worry about our own USD.
It makes it worse:

European Bank Troubles Demonstrate Cost of Uncertainty: View

Aug. 12 (Bloomberg) -- Financial markets’ growing concern about the state of European banks exposes a reality that the political theater in the U.S. had obscured: The euro area’s debt troubles are probably the single largest threat to the global economy.

The share prices of European banks, and in particular France’s Societe Generale SA, have plunged in recent days as investors speculate that the banks could be facing investment losses and difficulties borrowing money. SocGen has denied the rumors, but the nature and veracity of the specific concerns is almost secondary.

European leaders have created a fertile ground for panic by failing to dispel the main uncertainty: How they will resolve the financial troubles of strapped euro-area governments, how much banks holding the governments’ bonds stand to lose as a result, and whether the banks can be bailed out.

Investors’ dark view demonstrates how costly uncertainty can be. Consider, for example, the market value of bank equity compared with how much the banks say they’re worth in their financial statements.

As of Thursday, SocGen’s market value stood at only 52 percent of tangible common equity, suggesting that investors think it will need about 16 billion euros ($22.8 billion) in fresh capital to cover losses, according to data compiled by Bloomberg. For a group of 31 European banks, the market-to- tangible-equity ratio was just under 70 percent, implying they collectively face losses that would require some 137 billion euros ($195.1 billion) in capital to offset.

Money-Market Funds

European bank troubles matter for the U.S. and the rest of the world, in part because the money-market funds in which millions of U.S. households keep their savings have invested heavily in European bank debt. Trouble at money-market funds would disrupt the short-term lending markets on which U.S. companies depend to pay suppliers and their own workers. Much as after the Lehman Brothers Holdings Inc. bankruptcy, the resulting credit freeze could force companies to slash production and fire workers, triggering a sharp recession in the world’s largest economy.

Ideally, Europe would conduct stress tests showing exactly how much banks can lose and immediately announce how they will raise the necessary capital, much as the U.S. did in 2009. But no stress test can be credible until European leaders own up to the fact that some governments can’t pay all their debts, define the losses investors will take and put a system in place to guarantee the debts that can be paid.

As Bloomberg View has advocated, the best route to clarity -- and stability -- would be for all the governments of the euro area to issue new bonds guaranteed by a unified finance ministry with taxation power. Investors would exchange the debt of individual governments for the euro bonds, probably at discount rates that would erase some of the debt at the investors’ expense. The remaining sovereign debt would be sustainable. Banks and investors would know the extent of their losses.

It won’t be pretty, but ultimately the bloodletting will have to happen.

You have read enough to now let Floyd up on his soapbox to share with you how we continue to try to destroy our own world:

1. As Roubini stated, "nothing was fundamentally different than three months before. It appeared we would hit a boundary and massive lots were sold, to later be bought, by less than 10 hedge funds." "This appeared to be a "massive short" with a falsified upside to rape anyone near by trying to trade".

2. As Nenner stated" The market is certainly not good, but it is not this bad. We are seeing political turmoil in the U.S., and manipulated games, control the price of assets.

3. As Floyd believes: The Republican Party, since the day Obama was elected, have worked for four years to do nothing but make sure he is not re-elected and that the massive changes he has tried to lead through are all stymied.
Republicans do not want to tax the rich, but tax the middle class more. The goal is to eliminate the middle class so they can quit wasting time fighting and explaining. The poor are under their control.

I stand aghast while I see sold social (not socialistic) programs be attempted. The entire FDR/Truman WPA program now being pushed by some Republicans is right yet fully ignored and destroyed as a bill year 1.

We have a small group of men and mean women that lead this party, and thusly even the party is so stupid they aren't guilty trying hard to create a world council for oligarchs.

This I believe

_____________________________

I also have faith at some point the American people have enough smarts to throw the pee partiers out (originally hired by the Pubsters and now backing up and messing up some of the Republican fascists plans. I name call was purpose. These people do not want to allow a majority in control and they can actually make people believe that the Democrats want to take money from the rich and give it to the poor, NOT what is being proposed.

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The Violent Selloff

Commentary: Let us begin the most violent week in recent market history. Both of the attached Bloomberg articles summarize well:
Making Sense Of Thursday's Violent Market Selloff

and

THE RICH GET RICHER

http://www.huffingtonpost.com/2011/08/04/irs-incomes_n_918458.html



Historically August has been the worst Do month from 11988 to 2005, but was up the last 4 years.


And for today: The average man is always waiting for something to happen to him instead of setting to work to make things happen. For one person who dreams of making 500000 lbs, a hundred people dream of being left 50,000 pounds.-AA Milne, author of Winnie The Pooh

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Market makers speculate in large blocks using computer algorithms to buy 10000 options in Apple so that they can sell proportionately the same proportionate number of contracts; they electronically manipulate the market
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*The world is not in any form of balance and in down cycles, this is bad news. The market was fully invested when this happened, showing that not many believed or saw what was to occur.
*If the S$P bottoms near 1139 or the Nasdaq near 2200 we'll continue in weekly negative cycles for several weeks, with only the chance of a bounce.
General Projections: Gold is only showing weakness, in spite of a negative cycle, but is only a sell cycle at 1625; Silver continues to hold up. It's a sell signal if it closes below 39.

SEPT crude his 86.50. It may short term bounce but even oil looks as if it down.

We have taken profit in the past week in all our U.S. Bonds. Let's use Nennner:
30 year-tops at 142 could hit 148
10 year-tops at 132.20, could hit 134
5 year upside to 124

Natural Gas remains just an overall short term crap investment. It can't break it's own pattern.

_________________________________________________________
Quite simply we have shit in our own shit. And walked all over the stuff for years, beginning to even think that plastic purses were worth $600. And that the same rich people, that we are making richer.

I will take me sometime to overcome what we have done too ourselves as a nation. There is little to say but to begin to regroup, and to wonder who did it to us.



Take especially prudent risk.

At Times I am Ashamed of Us

From Trader MP:
How are you my friend?

long time no speak....

I just came across this article and had to throw it your way..

I honestly cannot take anything that this man writes about as having any value..and he is a noble prize winner? What a joke!!

To honestly think that the price of gold today has any relation to Glenn Beck is complete lunacy...

This guy ALMOST sounds as foolish as Bernanke the other day when he said that "gold is NOT money..."

Can you believe Bernanke actually said that?

Anyway..your boy Krugman is at his finest here!

Honestly...how can anyone actually give this man any credibility after a brief article like this?

http://krugman.blogs.nytimes.com/2011/07/19/the-glenn-beck-debeers-connection/
My response:

I agree
Bernanke is dead right
Krugman gets the game
Most don't

We will worldwide live in printed money
And deficit limits will be ignored

Nothing the republicans have said has even made sense
I was hopeful when Obama and boehner met privately

This is all about how far the bankers do it

Read krugman books not lines from a section

Murdoch. Hmmm fox news and the wan and barrons

Listen to understand. Not to be understood.
MP Responds:
seriously...
I mean seriously...

how can you possibly say that Gold and silver are NOT money...

What is "money?"
And my final response:
Whatever value is put on something. At one time long ago it was beads, later precious stones, than precious metals. Money is not real. This is my point for all the time. We put value on something that doesn't exist.
We created the term and value for money.
Learn this and you'll trade like a hawk.


Thanks for allowing me my first "non input" week off; no email, phone, data projections or charts.

My only input was the reading of propagandist Murdoch's Wall Street Journal, and the occasional news.

Last week followed the the same cycle wave on the Dow within a point and figure chart as have the last 6 weeks, and we have remained in the same trade range. We exited last week near to the bottom of that cycle, with a market completely hypnotized by our debt ceiling.

_________________________________________________________________________
Whenever you learn that money itself is not real you will have mastered the market.

We actually have the layman, you and I, reading or watching Murdoch TV or press, or listening to news input and believing false facts. And the parties are playing games right to the end to the end to influence their members.

I am embarrassed often to admit I live in the U.S. (I know I will receive some bumpersticker now "If you don't love the USA, leave it," and I also know this person will be able to vote also.)

So, like me or not:
*The Republicans, led by the Pee Party, are being ridiculous assholes, and NONE of the things they are demanding (even if it all passes) will ever truly STAY in reality. It may start that way, but it won't last.
*The Democrats (Obama) is playing a true war game just as he did with Osama, and will not blink.
Any compromise will truly be "win" for Obama, although it may cost him the election.

*Bush lowered taxes and we have not raised them. So why aren't there more jobs? Wasn't that what he said?

*Why are the rich getting richer? Corporations doing magnificent, with massive amounts of cash?

*Why do we as people not see the oligarchs are praying for the Republicans, as it creates more serfs, and makes them richer.

It's why I had to take a week off. I hate stupidity and this is stupid.
_________________________________________________________________________

I am unable to argue with illogic. "The Republicans stopped the speed train money, so we'll save 5 billion." "We have to quit giving to people, and make them get on their own."
And I am afraid I will say something so angry that subscribers will leave, so instead I left.


Good luck with how you interpret this all. You have been lied to for so many years

_________________________________________________________________________

A diluted bill will pass. The market is already prepared. I believe the Pee Party will finally pee on themselves and destroy much of their own party. And that Obama will pass most of what he needs. And that the market will go up substantially, within whipsaw, near and even above our market tops.

Our risk will be a play only to the call, to an August issue, with two buys, no butterfly or straddle hedge, and a winner/loser takes all.

We believe the entire concept of the deficit is false and should be eliminated.

Nor do we believe any foreign entity, already close to default themselves, allow such foolishness.

Just say it aloud and you know: Michelle Bachman could actually be President.

At times I am ashamed of us, fat, greedy, and ignorant.

Bubbles to Business

Even though Floyd and family are basking in a quiet island paradise this week and you will NOT be receiving daily alerts with his commentary, I could not help but to allow my weekly rambles. So, first, on bubbles:


The New Life Cycles of a Company

Dr. Adizes is one of the world's leading experts on organizational performance and change. TEGLLC, the parent company that owns OEX and BCO Options is a full service consulting company that has used his seven- step cycle of how an organization performs in various stages in all of our business development and restructuring programs.

With "bubbles" to business becoming more frequent, note that they follow the same predictable cycle. With a "bubble" (Internet, social networking, etc.), however, and there are four (4) stages:

1. Conceptual Stage- In a bubble companies are formed and consumers show high interest in the product or service.
Recent examples of “bubble euphoria” are Facebook, Pandora, Linked In, and the variety of social networking platforms.
In the latter portion of the conceptual stage users begin to truly accept the new technology. They incorporate the technology into their daily life and become avid users as well as often becoming "evangelists" for the technology.

2. Hypergrowth Stage-By now consumers are fully on board and investors begin to take notice. Here is where IPO's are hatched, and the money raised is then plowed into new growth initiatives. Here's where investors can make the most money, and also the period where skeptics are the most vocal.

3. Maturation Stage-This is when companies begin to see market saturation and growth levels out. Profit growth does not contract, but growth levels turn to more normal rates of return. Companies are actually more stable at this stage, but it's more dangerous in investing as stocks are trading with high multiples while growth is much slower than it has been in the past.
This is the bubble. Investors typically pay premium prices for non-premium stocks.

4. Contraction/Completion Stage-During this final stage pure cutthroat capitalism comes into play. Prices are driven lower, and profit margins are crimped. Now investors begin to realize that they are paying a premium price for a not-so-premium company. This is the period where we see earnings expectations drop and price multiples decline, and where we see more investors "fight" that this is occurring and lose all of their gains.


One Question: The stock you own in the bubble: What stage is it at?

Traders were able to sell their January 2013 AAPL Call for between 40% and 80%.
When we first bought this long-term call AAPL dropped 23.4%. Many traders doubled their position, and our recommendation. If they held thru July 20th their returns were between 40 and 80%.

For any of you that own a Microsoft based product as compared to Apple I would love to know what it does that an Apple cannot do? I wonder when companies receive 91% positive consumer rankings, as Apple does, while Microsoft receives a 31% rating, why someone would not change?
It is much like question of “what is in the Constitution”? How many of us have actually read it? This clearly relates to illogic, the Floydian defined condition where despite facts nothing changes. People misinterpret the obvious, believe it is real, and defend a position.
Pee partiers come to mind.

We need not fear that China will pull up its’ stakes in our debt. They are our largest single creditor, are fearful of what we do but have little choice but to buy, continue to buy, hold, and grumble. This is the ultimate “too big to fail” global relationship.

Illogical Logic

Commentary: We are a company taken over by MBA's. It is the baby boomers, hot to trot with the big business degrees, that have categorically taken a supply and demand/cause and effect based economy world wide and have systematically taken industry and manufacture not first in the line.

The more I read of Madoff the more I see that MBA logic purveyed a sense of illogical logic, a Floyian term for where something that makes no sense is explained by the water in a glass jar and that there will always be.

Madoff traded fake large blocks of OEX Options for profits. There were no such options being sold in this volume and no one checked. He said "somone has to pay for being stupid" and sinner that he is I smile.

The facts weren't checked. And if they had been, or if they were being, it was through illogical logical.

We have been living on what is not real, thusly buying what we have created that is falsely real, and the very jobs we scream for we have taken away from ourselves.

Do I Not Love Myself?

We all know about yet another week of massive whipsaw, all within our Dow Projections, and profitable for us on all trades we made in the OEX.

We all know Floyd has been laying low on new stocks or options for Blue Chip Options, preferring to buy more of certain issues on the down stroke. A great example in our Jan2013 AAPL call when dropped 24% after our first buy. I bought twice as many, lowered my cost, and just sold the position for a 40% sale.

Most traders never follow I buy LEAPS not just to hold them, but also to buy them on the down stroke, if I see the are ripe again for an upstroke.

Often we speak of Richard D. Wyckoff, the famed trader that my Dad, with Wyckoff Associates, Inc. was the sole licensee of. I grew up studying Wyckoff, and continue to highly recommend Charting the Stock Market: The Wyckoff Way.

Jack Huston, President of Stocks and Commodities Magazine but the actual writers edited this book were two young men that worked for my Dad when I was growing up. They know their stuff. The following website is from another Wyckoff student and worth your reading

http://www.readtheticker.com/Pages/Blog1.aspx?65tf=267_wyckoff-20-for-the-21-first-century-2011-07

Then, for those of you that follow and study the internet portion of technology - a great article on what some of these companies are and will

http://online.barrons.com/article/SB50001424053111903404604576405802487034120.html

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A subscriber this week wrote me a lengthy email crying out for help, which I’ll simply paraphrase.

“-Do I not love myself? I fail at this trading no matter how hard I try. Am I setting myself up for failure, or how can I stop myself”

I gave this Advanced Mentoring subscriber my point of view and he sent it to a friend, a clinical psychologist who specializes in sports medicine, and our subscriber sent both his commentary, and mine, and here is how his Dr. responded:

“Well written emails to Floyd that clearly capture your dilemma. I read a great chapter recently in a sport psych book titled “Try Easier”. The thought behind it is that when we try too hard (as you reference with regard to baseball… and perhaps the market too?), our performance actually suffers. The suggestion is to back off a little bit (go at 90% intensity instead of 100%) and you actually perform better. Physiologically when we try harder it’s like stepping on the gas and brake at the same time… our muscles work against each other.

One thing that needs to change is/are your expectations of yourself. Perfectionism, in all its forms, is nothing but a set-up for disappointment. Unless you have complete control over all aspects of the situation, it’s difficult to expect everything to go your way or as planned. In sport and trading, so much of it is beyond your control. All you can do is decide when to get in and when to get out, what happens in between is uncontrollable, therefore not worth focusing on or trying to control. You will drive yourself nuts trying to control the uncontrollable.

Question… to what degree are you influenced by being perceived by others as a “successful trader”. Do you want to be able to tell people that you scored big and out-smarted the market. Somehow, this matters?? Truth is, nobody cares one way or the other. I believe people would be just as impressed hearing you made $100/day for 10 consecutive days rather than scoring a $1000 trade on 1 day.

The difference between you and I is that you have a lot more riding on the market than I do. The other way to say that is I am less dependent on making $$$ in the market and see whatever I make as gravy… I don’t NEED to make money there, I would like to, but don’t need to. For you I think it might be different. There is a pressure there to make some money… not sure if it’s self-imposed or what, but it’s like you have to win big or it’s all for naught. The joy can come from executing you plan precisely, not whether it nets you 2K or 5K. The gains will add up…if you let them!!!”

This psychologist has it spot on, and each of you should print this and frame it.

The primary failures I see in traders that I work with is that “they expect too much money” and are waiting for “more”, only to see it all erode.

Our success has come from:

1. Trade by rules

2. Never make too much money. Be happy with small 20 and 30% earnings most of the time. There is no place else in the world you can earn 20 or 30% on money invested, sometimes several times a day, with your only overhead being cash.

3. Not listening to talking heads, news, or predictions. Studying only the FACTS.

Here’s an example: last night (7/7/11) ABC interviewed Maria Bartirimoro.

http://en.wikipedia.org/wiki/Maria_Bartiromo (Really read about her background)

Cute, able to articulate well, and after the question “is it likely that we will repeat a second full recession because of the high unemployment figures, and struggling economy. Maria, probably making a million a year for her opinion, very articulately points out from a chartists perspective that “yes, it is indeed possible”….she then gives a few reasons….and looks very serious as she says “Americans must be prudent at this stage”.

Please excuse me while I climb up the soapbox and respond:

What the fuck? Any child could tell us the market could go up or down and that things look bad so they could get worse. And another child, taught only to see that we have returned the stock market from lows never seen before 4 year ago to near 13,000.

I sit there seething because I can see Joe and Jill at home listening to that smart financial lady telling them that everything could be worse.

Pure unadulterated histrionics. Perhaps Maria even suffers from:

What is histrionic personality disorder?

Histrionic personality disorder is one of a group of conditions called dramatic personality disorders. People with these disorders have intense, unstable emotions and distorted self-images. For people with histrionic personality disorder, their self-esteem depends on the approval of others and does not arise from a true feeling of self-worth. They have an overwhelming desire to be noticed, and often behave dramatically or inappropriately to get attention. The word histrionic means “dramatic or theatrical.”

This disorder is more common in women than in men and usually is evident by early adulthood.[1]

My point is that we believe what we read or are told, and it soon becomes true.

Mass mesmerism: mes·mer·ize   

[mez-muh-rahyz, mes-] Show IPA

–verb (used with object), -ized, -iz·ing.

1.

to hypnotize.

2.

to spellbind; fascinate.

3.

to compel by fascination[2]

Study real facts. Maria is cute, but she does not even have the educational background, so noted, to be making these statements.

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[1] Wikipedia-Cleveland Clinic

[2] Dictionary.com