Why 666 wasn't the bottom

Simple thought....

All of the excess that got us to this point...nothing has been learned.

95% of everyone wants more easy money, willing to accept atrocities of the financial overlords.

Because nothing has been learned-- This recent past low of 666 cannot have been the bottom.

Until a large lesson is assimilated, the bottom, and a chance for growth, and a wall of worry, is not likely to happen.

This lesson will be painful.   Every option to avoid this lesson will be taken, making the lesson worse.

Link to Pretcher.   I did just receive the new CTC and will get a little Sunday suntan reading in and let you all know if it is worth making the purchase. 

http://www.elliottwave.com/cnbc-11-05-2009.aspx

Failed Bank List ---

Bank Name	City	State	CERT #	Closing Date	Updated Date
United Commercial Bank	San Francisco	CA	32469	November 6, 2009	November 6, 2009
Gateway Bank of St. Louis	St. Louis	MO	19450	November 6, 2009	November 6, 2009
Prosperan Bank	Oakdale	MN	35074	November 6, 2009	November 6, 2009
Home Federal Savings Bank	Detroit	MI	30329	November 6, 2009	November 6, 2009
United Security Bank	Sparta	GA	22286	November 6, 2009	November 6, 2009
North Houston Bank	Houston	TX	18776	October 30, 2009	November 3, 2009
Madisonville State Bank	Madisonville	TX	33782	October 30, 2009	November 3, 2009
Citizens National Bank	Teague	TX	25222	October 30, 2009	November 3, 2009
Park National Bank	Chicago	IL	11677	October 30, 2009	November 3, 2009
Pacific National Bank	San Francisco	CA	30006	October 30, 2009	November 3, 2009
California National Bank	Los Angeles	CA	34659	October 30, 2009	November 3, 2009
San Diego National Bank	San Diego	CA	23594	October 30, 2009	November 3, 2009
Community Bank of Lemont	Lemont	IL	35291	October 30, 2009	November 3, 2009
Bank USA, N.A.	Phoenix	AZ	32218	October 30, 2009	November 3, 2009
First DuPage Bank	Westmont	IL	35038	October 23, 2009	November 3, 2009
Riverview Community Bank	Otsego	MN	57525	October 23, 2009	November 3, 2009
Bank of Elmwood	Racine	WI	18321	October 23, 2009	November 3, 2009
Flagship National Bank	Bradenton	FL	35044	October 23, 2009	October 29, 2009
Hillcrest Bank Florida	Naples	FL	58336	October 23, 2009	October 28, 2009
American United Bank	Lawrenceville	GA	57794	October 23, 2009	October 28, 2009
Partners Bank	Naples	FL	57959	October 23, 2009	October 28, 2009
San Joaquin Bank	Bakersfield	CA	23266	October 16, 2009	October 21, 2009
Southern Colorado National Bank	Pueblo	CO	57263	October 2, 2009	October 20, 2009
Jennings State Bank	Spring Grove	MN	11416	October 2, 2009	October 20, 2009
Warren Bank	Warren	MI	34824	October 2, 2009	October 20, 2009
Georgian Bank	Atlanta	GA	57151	September 25, 2009	October 13, 2009
Irwin Union Bank, F.S.B.	Louisville	KY	57068	September 18, 2009	September 22, 2009
Irwin Union Bank and Trust Company	Columbus	IN	10100	September 18, 2009	September 22, 2009
Venture Bank	Lacey	WA	22868	September 11, 2009	September 15, 2009
Brickwell Community Bank	Woodbury	MN	57736	September 11, 2009	September 15, 2009
Corus Bank, N.A.	Chicago	IL	13693	September 11, 2009	September 15, 2009
First State Bank	Flagstaff	AZ	34875	September 4, 2009	September 14, 2009
Platinum Community Bank	Rolling Meadows	IL	35030	September 4, 2009	September 14, 2009
Vantus Bank	Sioux City	IA	27732	September 4, 2009	September 14, 2009
InBank	Oak Forest	IL	20203	September 4, 2009	September 14, 2009
First Bank of Kansas City	Kansas City	MO	25231	September 4, 2009	September 14, 2009
Affinity Bank	Ventura	CA	27197	August 28, 2009	September 11, 2009
Mainstreet Bank	Forest Lake	MN	1909	August 28, 2009	September 11, 2009
Bradford Bank	Baltimore	MD	28312	August 28, 2009	September 11, 2009
Guaranty Bank	Austin	TX	32618	August 21, 2009	September 4, 2009
CapitalSouth Bank	Birmingham	AL	22130	August 21, 2009	September 11, 2009
First Coweta Bank	Newnan	GA	57702	August 21, 2009	September 11, 2009

Un-American

Recently, I have been called Un-American on a blog, naming another large blogger (intials TK) as also being un-America

As far as I can digest their argument, they take this view because "I think the market is too high."

Has anyone read the Constitution? Bill of rights? Quotes of our Founding Fathers?
Many of these are premiscient in terms of events that are currently unfolding.

I can hardly imagine anyone besides myself being a bigger supporter of America...I sure there are those have sacrificed dearly who deserve a higher level of "Being American",  than just those like me who are in ideological respect for the concepts of "America".

I have not served our country in the the military, although I proud to have worked for over  two decades with those in the military, and for the most part they are really excellent people, who have lately been put at severe risk and strain and stress. My Father and one of my Brothers served in the Armed Forces.

The market being this high is not a sign a strength, it is a sign of weakness, of corruption of the system.  Of distribution from strong hands to weak hands.  Of social inequity.

GO AMERICA --- and think of "Point of Recognition" ---to change for the better.

Complacency and complaints without action will end up with a transparent parchment of a Constitution.

Short Canada? Thats almost un-American

Canada Housing is now at record levels.  Housing in remote cities sell at prices equal to Honolulu, and Honolulu has had some Housing contraction in prices, but not that much, maybe 15%.

If there is another downturn, and deflation, Canada being big on commodities, will get crushed.  And people living in $600,000 homes in Canada may find that it's even too cold to live in a tent city.

EWC is a Morgan Stanley index of 95 Canada based stocks.

Research and finding other more targeted stocks could be even more profitable.  Let me know if you have any other ideas on how to play this one.

http://seekingalpha.com/article/170429-the-new-economy-and-canadian-housing-s-bubble-status

http://globaleconomicanalysis.blogspot.com/2009/11/canadian-says-short-canada.html

Boatload O' Charts 110509

Need I say more....a continuation of the Boatload.....all shorts, put on your radar screen and trade according to your own system and plan, using appropriate stops as long as you are trading equities with adequate liquidity (daily volume over, say, 400,000 minimum).  And if you are trading below that volume....well....have at it, I want none of that. 

Sucking on the Government Teats

I follow government work.  It is a big thing they write into their RFPs and the required RFP responses....how many jobs will be created by "Your Proposal Response", and they write in laborious reporting requirements that you have to do throughout the project, draining precious management time, in order to help the Gov prove how their stimulus benefited the economy.  It is like a whole new layer of bureaucracy just to prove "that it's working" and to being back confidence.  And it is draining resources in order to do it.

I guess in a proposal response, one should just lie about how many jobs will be created, seriously, that probably gets you more points in proposal evaluation even if it is 100% BS.

Ghastly Rhyming -- An Amazing Nearly Duplicate H&S

If you don't know Fibonacci and Head and Shoulders Patterns, stop wasting your time here.  It will be of no matter to you if you do not understand the basics.

That said, these little nuggets are some of my best work outside of my Chart of Charts which needs to be partly automated or it is just too laborious to produce.  The price targets on the lower chart were posted on Tuesday, after the big Fed sell-off.   The wizard is hard at work, but the wizard is beholden to the Government who needs to fool the people into thinking higher priced 401K's are making them better off.

This is all pretty sad, however, minimize your wasted energy on that matter.  And figure out how to make some money, you are going to need it.   You can also buy physical gold, while shorting GLD. 

Then buy more physical with the proceeds of the GLD short.  And don't forget the bullets.

Dow 10,000, yeah!!!!

Headlines everywhere I am sure.

Is retail really fooled?  I am sure some are.

Or can I put on my tin hat....and say this rally is predictable (hell even this perma bear predicted this, just my futures  hedging calculation was off, for reasons that make no sense and will probably take hours to figure out why).   But also rally is predictable because there are trillions of dollars that need to be offloaded to someone...be that retail, or I hate to say, Government employee retirement funds, that see to be sold to be smooth salesman "investment advisors". 

You know who is buying stuff these days?  Government employees.  Their wages have gone up 30% in a same time span as average wages up 10%.   And new retirement benefits are being increased.

Observe and react as best you can.

But keep in mind....distribution from strong to weak.  That is the name of the game of the life sucking squid perched on our faces....Humongous Bank and Broker. 

Many great bloggers are getting sick of the game, sick of the snark, sick of being insulted by people who are benefitting from their freely provided hard work.    Its the sign of the times.

I capitulate, now the market can finish its topping process sub rally.....

IHS on indexes galore, get ready for sled ride up, see previous posts

The title is all I have to say. 

GDX And DWC (Total Market) Facing Resistance

An attempt at Stockcharts post Junk Bonds

A linkable Stockcharts Posts.  Will see if it updates in time or is fixed.

http://stockcharts.com/h-sc/ui?s=JNK&p=D&yr=0&mn=4&dy=0&id=p07543723028&r=8590&depth=24&listNum=&cmd=chartnotes,889|761

Silver Once Again

I was whipsawed out of the Silver futures short, after covering my first short around 16.42-- thank goodness for stops!

This is what I would call fractured market trading, asset classes all popping their heads up in a pop-a-mole fashion as fast money pops around while the topping cycle continues.

Very glad my ES long futures was still in place.   See attached possible IHS on ES. 

Cool link for visual representation of stocks

Found this on Doctor Brett site.  I will put it on my trading tools site and see if it passes muster.

http://www.thecrosshairstrader.com/2009/11/monthly-stock-mover-indicator/

Silver, Hi-Ho Silver

Bear versus Bull

Let me reduce this to a few sentences.

The expression "Bears have to get going" to push the market lower is absurd.  You can't push the market lower by shorting.   All you do is set a target for a stop run.  This adds fuel to the bulls. 

Bull can push the market higher....all they have to do is buy.

Bears have to be smarter than bulls...using the bulls own energy against them. 

OK, get it?   This is not bears versus bulls.   It is about when when bullishness is exhausted....do the bears still have the wherewithall and/or the nerve to jump in at that point.

Mining and Gold Bulls

This is the third time I have seen an article on record production and serious losses on miners.

Keep an eye on things.   "They" like to deceive and "they" own the media for the most part.

Some of these foreign commodities websites may report more truthful information.

Interesting Take on Treasuries from Stock Traders Daily

This is republished with Permission

http://stocktradersdaily.com/reports/TreasuryBubble.pdf

Enjoy and comment

DWC Log and linear

Tim Knight is strong on using log scale.   Others prefer linear, sometimes for shorter timeframes. 

This Dow Jones Total Market chart shows a point between the log and linear.

And a hell of a confluence of trendlines like a laser war and the DCW index totally tapped its 50% Fib line.  Amazing, and thank you Mr. Fibonacci.  You rock almost as much as Bernoulli.

Commitment of traders and ZEAL

I used to read these guys alot, but found that they were too one sided commodity bulls which doesn't mesh with my   "it's all going to go down" point of view.  However they do some nice charts, albeit too small, and then have some good ratios, and a long term look on things.

They were pimping out a report on 52 junior minors, which promptly after I bought the report, the juniors went to tank 75% to 90%.   

I also saw some old reports they did were they were utterly convinced of a S&P direction and then were totally wrong.   It is the utterly convinced part I have umbrage with...we are all wrong occasionally.

http://www.zealllc.com/2009/goldcot3.htm

The COT guy that I follow his method says For Nov 2 week---Gold down, S&P down, crude down, Banks down.

Nikkei bullish,.

Natgas and 30 Year Bond nuetral.

ES

When the lower target is hit, I will put a pretty tight stop under my long /ES hedge.  When the upper target is hit (if its hit), My long hedge will get a very tight stop,

Futures and Leverage

One reader asked about futures, and if there a simple way to understand them.

After all....most advanced traders will immediately launch into some diatribe using big and confusing words, fancy formulas appropriate for a high level college math course, etc.

First off---they want to confuse you and make you think this stuff is so confusing that only they cam help you (translation--take your money).  Second, its like every business out there....obscuring the simple realities of their business with a fog of confusion that provides a barrier to entry, so once again, they can confuse you and take your money. 

NOT SO AT HAWAII TRADING!


$.25 move on the S&P (/ES Futures) results in a $37.50 change in your account, per contract.

150 to one leverage.


Let’s say S&P=1000 to keep it simple.  Lets assume a 2% move = 20 points, or (80) ¼ point ticks, 80 * 37.50= $3000 gain per option


You need around $5000 of buying power in your account to buy one ES future.  NQ future are lower leverage and lower “price”.


Works same to the downside as the upside.  It is a direct bet with a counterparty.


Shorts and puts will likely become illegal….very soon.   Obama has the mental and financial capacity to back that bandwagon.   Then as everything sells off, only HBB and Steveo will have short futures.


Although tonight I have long futures...hedging many short positions as most Fed days get a 1.5% pop.  Long at 1045.75.


With index futures, 2/3 of your trading profit is automatically taxed at long term capital gain tax rates, and 1/3 at short term capital gains tax.   A massive advantage….and one clearly designed to help the “big money” get even bigger.


Futures are hunted at night, and Asian and Europe markets bet on the American markets.   Volumes are way lower at night, but in the last 2 years, the night volume has gone up maybe 300% or 400% just by personal observation.


HBB is, in my humble opinion, gaming the markets by pushing futures around at night, creating more gaps up and down that take people out of there positions.


Daytraders don't get a chance to get a piece of these moves, and swing and long term traders can get whipped out of their positions.  Our financial overlords have really outdone themselves this time.

Short ideas

$DWC Whole Market and SMH

Peet's Indicator

http://apnews.excite.com/article/20091103/D9BNNJBG1.html

Peets is losing it.  They have been on sale twice in the last 2 months at the local store.

Now they are desperately willing to do anything to keep the profits rising, even paying a 28% premium to buy another coffee company.

Hands down....as the bull retrace winds down....uppers will become lambasted and downers will become embraced.   

Betting Long? And DLST

There are so many site promoting long bounce....well, just go tot stay and increase the shorts.

Shorted silver and Russell 2000 via /TF futures tonight.

And in Hawaii DLST Day Light Savings Time does not change, Hawaii doesn't follow that time adjustment.  And this means now market opens at 4:30 AM which is sometimes feasible.  3:30 AM is brutal.   So what a perfect timing for a bearish downtrend.....

OK here is a plan....make enough money during non day light savings time trading, and take the rest of the half year off.  I like it.  

http://screencast.com/t/6ecUaRDDJXG

Russell futures short.

Week in Pre-View

Short term trend is down, Intermediate is down.

Many long term trendlines have been broken.

Mutual funds are leaving the market at a fast pace.

Gold miners have been pounded, they will probably bounce.

Silver bounced big against my futures positions,

HBB is distributing stocks to "retail", but even retail is backing off.

There is a decent chance that stocks will bounce up, just based on big selloff last weekend. 

That said I am short futures on S&P at 1041.25 with a stop at that same price. Small position of 3 futures, however, based on recent erratic market action, this small position size is OK.  

Let us let the market tip it's hand before we get all gonzo short.

Great site, great summaries of econ data in chart form

http://www.calculatedriskblog.com/2009/10/october-economic-summary-in-graphs.html

More bank failures

http://www.marketwatch.com/story/small-banking-empire-collapses-9-fail-in-1-day-2009-10-31

OK some simple math. These 9 banks had combined assets of 19.4 billion, and deposits of 15.4 billion. Assuming that "assets" are actually money lent out, this is 4.0 billion dollar shortfall.

They say the FDIC will take a hit of 2.5 billion.

That would mean that somehow $1.5B of depositor money is not insured.

Think about how absurd the current overall situation has become. The FDIC expanded its coverage from $100,000 to $250,000 last year. So people are probably OK with keeping their deposits concentrated. What if on Friday morning the insolvent FDIC declares that in order to better protect its constituents, it will go back to $100,000. And then after market close on Friday afternoon, they announce 150 banks have been taken over. Just saying...anything is possible.

Any bank that is a corporation and not personally owned by a group of investors that have serious skin in the game is suspect.

Addendum--after I wrote the above post, CIT announced bankruptcy--again.
http://www.marketwatch.com/story/citto-file-for-bankruptcy-after-rescues-fail-2009-11-01