Coming into today net long, watching the market get crushed and still coming out ahead is a small victory. Small victories aren't going to get me anywhere.
It occurred to me last night that getting long here is bit too cute which is why I took some longs off the table first thing this morning.
Honestly, I couldn't be happier now that July is over. It's been a month of distractions (vacation) and whipsaws (everywhere). In the end the market was flat for the month. Maybe now we can find some direction.
After trading like a god for about six weeks the last couple, since returning from vacation, have been tough yet I've not sustained major losses. Therein lies the key: limit your damage when things aren't going well. I feel more confident than ever that my next big hit is just over the horizon, which is important because it keeps me from pulling out my hair after a month like this
Thursday, July 31, 2008
Limping Home
My policy on gifts: don't return them. So after having bought a big fat chunk of MOT yesterday and turning on my laptop this morning and seeing it up 8%, well, you can guess. Sold it quick. Took the 8% gain instead of waiting for the 12% gain. Fuck it.
Also sold LLL too quick before it ramped another buck. As much as I try to hold my winners sometimes I lack the discipline to do so. What is there to say? I love to take profits and in the current market environment gains vanish quickly.
July has been a roller coaster. Up huge until this week when I got hammered, I'm now limping toward the finish line. The (somewhat premature) final result: I win again (in unspectacular fashion). Fine. I'm just hanging in until I get that fat pitch right down the middle.
UPDATE: MOT up 13%.
Also sold LLL too quick before it ramped another buck. As much as I try to hold my winners sometimes I lack the discipline to do so. What is there to say? I love to take profits and in the current market environment gains vanish quickly.
July has been a roller coaster. Up huge until this week when I got hammered, I'm now limping toward the finish line. The (somewhat premature) final result: I win again (in unspectacular fashion). Fine. I'm just hanging in until I get that fat pitch right down the middle.
UPDATE: MOT up 13%.
Wednesday, July 30, 2008
Got Drunk, Bought Stocks
First things first. Sold my trading position in GLD. Stop was $90. That level was violated at the open and I'm out. No emotion. Up is down and black is white. So be it. Not unexpected.
With that bit of business out of the way I proceeded to go on a drunken buying binge like some coked up money manager. Regardless of how it works out I feel pretty good about having covered most all of my shorts yesterday. Today would be painful had I tried to justify my positions rather than just reacting to the market's verdict.
As a trader you are going to be wrong about half the time. The whole key is to admit it quickly and cut your losers.
With that bit of business out of the way I proceeded to go on a drunken buying binge like some coked up money manager. Regardless of how it works out I feel pretty good about having covered most all of my shorts yesterday. Today would be painful had I tried to justify my positions rather than just reacting to the market's verdict.
As a trader you are going to be wrong about half the time. The whole key is to admit it quickly and cut your losers.
Fresh and Clean
Wednesday's watchlist is very different. My list has more breakouts than breakdowns and more buys than sells. It's also much shorter and tighter. In previous rallies I have sat out or worse yet tried to short into it too early. This time (should this rally have legs) I will look to get long. Been net long very rarely since last August. Think it might be nice for a change.
The erroneous theory, I gather, is that Merrill's huge write off, fundraising and sale of toxic assets marks the bottom. Never mind that the toxic paper sale was 75% financed by Merrill themselves and that two weeks ago they claimed not to need capital (was that a bald faced lie? and where the fuck is the SEC on this?). But now the market can function again and other impaired institutions can follow Merrill's lead. Divest, write off, nirvana. Or so the theory goes.
I agree that it's a step in the process. But I ask you this: who the hell is going to buy all this bad paper? There is so much of it everywhere. Besides if Merrill said this paper was worth 40 cents on the dollar two weeks ago and now they sell it for 20 cents on the dollar, what does that tell you about the balance sheets of other financial institutions? Pure fiction.
The psychology is such that bulls believe every disaster to be the bottom. Ultimately I expect us to go much lower on the averages but not in a straight line. We are due for a rally, before another fall. So again I'm rooting for a good old fashioned drunken rally where money mangers can do a few lines and buy stocks with reckless abandon. If nothing else I hope it might relieve this white knuckle feeling we've had lately.
Either way, rally or no, I will capitalize. I will trade long or short. I will cut my losers without hesitation. I will continue to learn and ultimately dominate. Put that in your pipe and smoke it.
The erroneous theory, I gather, is that Merrill's huge write off, fundraising and sale of toxic assets marks the bottom. Never mind that the toxic paper sale was 75% financed by Merrill themselves and that two weeks ago they claimed not to need capital (was that a bald faced lie? and where the fuck is the SEC on this?). But now the market can function again and other impaired institutions can follow Merrill's lead. Divest, write off, nirvana. Or so the theory goes.
I agree that it's a step in the process. But I ask you this: who the hell is going to buy all this bad paper? There is so much of it everywhere. Besides if Merrill said this paper was worth 40 cents on the dollar two weeks ago and now they sell it for 20 cents on the dollar, what does that tell you about the balance sheets of other financial institutions? Pure fiction.
The psychology is such that bulls believe every disaster to be the bottom. Ultimately I expect us to go much lower on the averages but not in a straight line. We are due for a rally, before another fall. So again I'm rooting for a good old fashioned drunken rally where money mangers can do a few lines and buy stocks with reckless abandon. If nothing else I hope it might relieve this white knuckle feeling we've had lately.
Either way, rally or no, I will capitalize. I will trade long or short. I will cut my losers without hesitation. I will continue to learn and ultimately dominate. Put that in your pipe and smoke it.
Tuesday, July 29, 2008
Pain
Dow up almost 2.5% today. I got beat like a red-headed step child.
Today's action explains my hesitancy to pull the trigger. Up 200, down 200- fuck that.
So having officially capitulated, I am now net long. It sucks but what are you going to do? If I have to get long to make money I will do that. Roll with the punches and live to fight another day. Easy come, easy go. Yada yada yada.
Financials in the green and oil in the red is a powerful potion for higher stock prices. I still think we could see another 600 points of upside on the Dow. I might even get long some beaten down financials just for shits and giggles.
Today's action explains my hesitancy to pull the trigger. Up 200, down 200- fuck that.
So having officially capitulated, I am now net long. It sucks but what are you going to do? If I have to get long to make money I will do that. Roll with the punches and live to fight another day. Easy come, easy go. Yada yada yada.
Financials in the green and oil in the red is a powerful potion for higher stock prices. I still think we could see another 600 points of upside on the Dow. I might even get long some beaten down financials just for shits and giggles.
Monday, July 28, 2008
Taking Advantage of a Bad Situation
I expect this latest bailout to have results but not those intended. Having now taken the financial black hole that is Fannie and Freddie onto the public balance sheet and having previously taken billions in bad loans in exchange for treasuries I contend that "the full faith and credit of the US government" is no longer worth a goddamn thing! We are now officially the United States of sub-prime.
These actions are unprecedented. We have opened a new chapter in American history. This is the era of crony capitalism.
I expect interest rates to ramp up over time. I've done some research and found some ideas to take advantage of this nascent trend. Put SDP, PST and TBT on your watchlist. I have taken no action as of yet but these will be on my radar. When treasuries weaken you want to own PST and TBT. As a result, interest rates go higher which is quite bad for utilities and that's where SDP comes in.
These actions are unprecedented. We have opened a new chapter in American history. This is the era of crony capitalism.
I expect interest rates to ramp up over time. I've done some research and found some ideas to take advantage of this nascent trend. Put SDP, PST and TBT on your watchlist. I have taken no action as of yet but these will be on my radar. When treasuries weaken you want to own PST and TBT. As a result, interest rates go higher which is quite bad for utilities and that's where SDP comes in.
Well Said
I enjoyed this quote from Peter Schiff. He says it better than I could. I encourage you to check out his writings at http://europac.net/#.
"Unfortunately, the laws of capitalism are now demanding that home prices continue to fall precipitously. But, based on the speed in which our government, public and financial institutions are willing to abandon free market principals at the first whiff of economic pain, the likelihood that this impulse will take hold is increasingly remote. So hunker down as the United States finds itself on the express track to state socialism with Paulson’s Bazooka locked, loaded and pointed right at us. When the government pulls the trigger the blast will blow the dollar, and what’s left of our capitalist economy, to smithereens."
"Unfortunately, the laws of capitalism are now demanding that home prices continue to fall precipitously. But, based on the speed in which our government, public and financial institutions are willing to abandon free market principals at the first whiff of economic pain, the likelihood that this impulse will take hold is increasingly remote. So hunker down as the United States finds itself on the express track to state socialism with Paulson’s Bazooka locked, loaded and pointed right at us. When the government pulls the trigger the blast will blow the dollar, and what’s left of our capitalist economy, to smithereens."
Back to Swimming with the Sharks
Back to my trading turret full time. Vacation is a distant memory.
Got stopped out of PFE. Getting long; what the hell was I thinking?
As for today, it sucked. The market is down a solid two percent and I'm up only one despite starting the day net short. I consider that under performance. There are an abundance of opportunities out there but from time to time I'm hesitant to pull the trigger. Now is one of those times.
The market's lack of enthusiasm for the latest bailout (that of Fannie and Freddie) is an ominous sign indeed. If the bailouts stop working the gates of hell will yawn wide. Bet on it.
Today I got short a few more names: COF, GGP and STT. Those moves accounted for better than half my gains. As I've stated repeatedly as long as the financials remain broken the market will remain broken.
Got stopped out of PFE. Getting long; what the hell was I thinking?
As for today, it sucked. The market is down a solid two percent and I'm up only one despite starting the day net short. I consider that under performance. There are an abundance of opportunities out there but from time to time I'm hesitant to pull the trigger. Now is one of those times.
The market's lack of enthusiasm for the latest bailout (that of Fannie and Freddie) is an ominous sign indeed. If the bailouts stop working the gates of hell will yawn wide. Bet on it.
Today I got short a few more names: COF, GGP and STT. Those moves accounted for better than half my gains. As I've stated repeatedly as long as the financials remain broken the market will remain broken.
Wednesday, July 23, 2008
Can't Resist
Not really looking to trade today but I just happened to be looking through some charts this morning and came across a nice little idea. Bought some PFE. Low risk with a stop @ $18.50.
No Big Hurry
Got back into town on Monday afternoon but haven't really went back to work yet. Taking my sweet ass time in compiling my watchlist and getting back in the market. What's the hurry? I'm happy so long as this rally continues.
My contention before I left was that this rally would be for real if the financials continued to rally. Sure enough this market rise has been substantial and led primarily by the financials. So long as the market continues to shake off the bad earnings news we go higher. I think 12K on the Dow is a likely target.
The shorts are getting worked. Meanwhile I'm quite comfortable in cash, thank you very much. I could be back to work Thursday, or not. Maybe not until Monday. I'm playing it by ear.
My contention before I left was that this rally would be for real if the financials continued to rally. Sure enough this market rise has been substantial and led primarily by the financials. So long as the market continues to shake off the bad earnings news we go higher. I think 12K on the Dow is a likely target.
The shorts are getting worked. Meanwhile I'm quite comfortable in cash, thank you very much. I could be back to work Thursday, or not. Maybe not until Monday. I'm playing it by ear.
Thursday, July 17, 2008
Just Checking Up
Just what I hoped to see today, namely strength. We've now added 500 DOW points in the last two sessions. Based on after hours though tomorrow could be unfortunately weak.
More interesting was the performance of my picks from this morning (despite my purposeful lack of participation). Coal stocks got crushed. My picks were winners to the tune of about 9% each. Not bad for a day's work.
Apparently I'm morphing into some sort of stock picking mutant-wizard-demigod. Imagine that. Perhaps I'm becoming a space alien magician.
I am going to put on a clinic in the second half. You still don't think so? Just watch me.
More interesting was the performance of my picks from this morning (despite my purposeful lack of participation). Coal stocks got crushed. My picks were winners to the tune of about 9% each. Not bad for a day's work.
Apparently I'm morphing into some sort of stock picking mutant-wizard-demigod. Imagine that. Perhaps I'm becoming a space alien magician.
I am going to put on a clinic in the second half. You still don't think so? Just watch me.
Just for Fun
Don't think that I'll be trading today. Much more likely that I'll be laying on the couch watching the Tour de France but since I made my watchlist for today anyway here is one idea.
Short the coal stocks. All three of these coal names are sporting rather pretty head and shoulders tops. All three sitting right at the neckline.
Short the coal stocks. All three of these coal names are sporting rather pretty head and shoulders tops. All three sitting right at the neckline.
Trying to Resist
OK. I admit it.
I set my alarm this morning and rolled my ass out of bed with the intention of doing my homework before the open. Can't help myself. What if I want to get long some DNA or short some ORCL? My fear, I suppose, is that the rally will fail and I need to be ready...or something like that. Maybe it's that I'm excited to finally see all those green candles.
Looking at the futures up big confirms that I don't need to do much of anything. Couldn't be happier. Run baby run.
I set my alarm this morning and rolled my ass out of bed with the intention of doing my homework before the open. Can't help myself. What if I want to get long some DNA or short some ORCL? My fear, I suppose, is that the rally will fail and I need to be ready...or something like that. Maybe it's that I'm excited to finally see all those green candles.
Looking at the futures up big confirms that I don't need to do much of anything. Couldn't be happier. Run baby run.
Wednesday, July 16, 2008
Cold Hard Cash
Trading account is flat.
Vacation has officially begun.
I'm lovin' this action. Stocks are spiking all around and the shorts are getting buried. I can just imagine if I was still short I would be getting ground up into dust and returned to the earth today. Yeah fuck that. I'll keep my profits (most of them anyway), thank you very much.
Meanwhile this little bull orgy, should it continue, will set up copious opportunities upon my return. Just makes me feel all warm and fuzzy inside. Going away without my laptop will even be a good thing insofar as it will keep me from shorting into a rally that still has room to run. My best case scenario may just play out yet.
So unless I buy a small island in the Florida Keys and never return I'll be back on Wednesday, tanned a deep a shade of bronze, rested, recovered and relaxed. See you then.
Vacation has officially begun.
I'm lovin' this action. Stocks are spiking all around and the shorts are getting buried. I can just imagine if I was still short I would be getting ground up into dust and returned to the earth today. Yeah fuck that. I'll keep my profits (most of them anyway), thank you very much.
Meanwhile this little bull orgy, should it continue, will set up copious opportunities upon my return. Just makes me feel all warm and fuzzy inside. Going away without my laptop will even be a good thing insofar as it will keep me from shorting into a rally that still has room to run. My best case scenario may just play out yet.
So unless I buy a small island in the Florida Keys and never return I'll be back on Wednesday, tanned a deep a shade of bronze, rested, recovered and relaxed. See you then.
Flat As a Pancake and Unofficially on Vacation
That's it. I'm sitting on one small long and one small short. Will likely be completely flat very very soon. Dow up 122 just now. To that I say: fucking awesome. Run baby run. At least for a few more days (like Thursday, Friday, Monday and Tuesday- I should be back and caught up by Wednesday).
As long as the financials continue to rally this move up is to be respected. Hopefully the inevitable great selling opportunity will wait until I'm back to work.
So, guess that's it. As much as I want to call it a day and start my vacation, it's very difficult to walk away from the market. As long as the market doesn't straight up crash in the next four sessions I'll be cool. Odds are decidedly in my favor on that one but still, it makes me nervous to walk away. I watch so many situations waiting for just the right set-up. Wonder how many set-ups I will be missing. Could be some name I've been watching for two years waiting for just this one chance and once it happens it's gone.
Poor me. I have to go on vacation. And I need it. The last couple weeks have been tough for me. Haven't felt motivated or hungry but uninspired and distracted. Yet the trading account is up almost five percent this month after smashing the cover off the ball last month. So why be greedy?
Upon my return there will be a new account for me to grow and profit from. The opportunities will still exist. Better yet I'll be fresh and refocused.
As long as the financials continue to rally this move up is to be respected. Hopefully the inevitable great selling opportunity will wait until I'm back to work.
So, guess that's it. As much as I want to call it a day and start my vacation, it's very difficult to walk away from the market. As long as the market doesn't straight up crash in the next four sessions I'll be cool. Odds are decidedly in my favor on that one but still, it makes me nervous to walk away. I watch so many situations waiting for just the right set-up. Wonder how many set-ups I will be missing. Could be some name I've been watching for two years waiting for just this one chance and once it happens it's gone.
Poor me. I have to go on vacation. And I need it. The last couple weeks have been tough for me. Haven't felt motivated or hungry but uninspired and distracted. Yet the trading account is up almost five percent this month after smashing the cover off the ball last month. So why be greedy?
Upon my return there will be a new account for me to grow and profit from. The opportunities will still exist. Better yet I'll be fresh and refocused.
Tuesday, July 15, 2008
Yet Hope Springs Eternal
Big reversal today. We opened with death and destruction and now everything is just peachy.
My fat gains of this morning have thus melted away. I have taken down risk again in hopes that this bounce can last. Regardless of how much I'm in love with my latest round of short sales I will cover that shit on the drop of a hat and profits will be protected. Period. My gains have been made for this month; targets have been hit. Vacation is near. Why fuck it up?
A handful of shorts remain on my book, all profitable positions. Wort case: they get covered for modest gains. Winners will not be allowed to turn into losers. Besides we may not be done with the downside. If we start knifing lower once again I'll be back on offense. Until then I sit (rooting for these weak ass bulls).
My fat gains of this morning have thus melted away. I have taken down risk again in hopes that this bounce can last. Regardless of how much I'm in love with my latest round of short sales I will cover that shit on the drop of a hat and profits will be protected. Period. My gains have been made for this month; targets have been hit. Vacation is near. Why fuck it up?
A handful of shorts remain on my book, all profitable positions. Wort case: they get covered for modest gains. Winners will not be allowed to turn into losers. Besides we may not be done with the downside. If we start knifing lower once again I'll be back on offense. Until then I sit (rooting for these weak ass bulls).
Monday, July 14, 2008
So Much For Wishful Thinking
Poof! There goes your bullshit bailout rally.
Rally got sold. So much for my wishful thinking/best case scenario. As long as stocks keep falling I'll keep shorting them. Line in the sand is 1425 on the S&P, we've bounced off it twice now.
Hmmm. I wonder if all of these bailouts are starting to lose their shine. Ominous indeed. Paulson and Bernanke are trapped and the market is starting to sense it. Gold will continue to work here.
I'd keep your crash helmet on just in case. And how far are we really from a series of bank runs? Interesting times we live in.
Rally got sold. So much for my wishful thinking/best case scenario. As long as stocks keep falling I'll keep shorting them. Line in the sand is 1425 on the S&P, we've bounced off it twice now.
Hmmm. I wonder if all of these bailouts are starting to lose their shine. Ominous indeed. Paulson and Bernanke are trapped and the market is starting to sense it. Gold will continue to work here.
I'd keep your crash helmet on just in case. And how far are we really from a series of bank runs? Interesting times we live in.
Best Case Scenario
Well here comes another "Bernanke/Paulson Bailout Rally". Futures up big this Monday morning.
Clearly this Fannie/Freddie bailout is an unmitigated disaster and throwing billions of dollars into these black holes is a great way to make the billions disappear.
Here is what I'm hoping for: a big frickin' rally, all this week and into next. See, I leave for vacation later this week and won't be back until Tuesday of next week. My intention was to get small and not have to worry about the market gyrations while I'm sitting in the Florida Keys drinking fruity cocktails. Besides looking at literally hundreds of charts this weekend it's obvious to me that we need a good rally to create opportunity.
I won't be buying stocks. Not looking to play this thing from the long side, aside from my gold position and maybe adding some energy names. With any luck I can get even smaller (having already done so thanks to Friday's afternoon rumors) this week without much damage and just put it on cruise control until the middle of next week. With any luck I'll be in vacation mode by this afternoon, provided this rally has some legs. Let's hope...
Clearly this Fannie/Freddie bailout is an unmitigated disaster and throwing billions of dollars into these black holes is a great way to make the billions disappear.
Here is what I'm hoping for: a big frickin' rally, all this week and into next. See, I leave for vacation later this week and won't be back until Tuesday of next week. My intention was to get small and not have to worry about the market gyrations while I'm sitting in the Florida Keys drinking fruity cocktails. Besides looking at literally hundreds of charts this weekend it's obvious to me that we need a good rally to create opportunity.
I won't be buying stocks. Not looking to play this thing from the long side, aside from my gold position and maybe adding some energy names. With any luck I can get even smaller (having already done so thanks to Friday's afternoon rumors) this week without much damage and just put it on cruise control until the middle of next week. With any luck I'll be in vacation mode by this afternoon, provided this rally has some legs. Let's hope...
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