There's about 23 trades up tonight, some are based on the FAZ/XLF/UUP divergences, some are based on other factors. There's a few Cats and Dogs in there as this is still rally season for those kinds of trades.
I STRONGLY ENCOURAGE YOU TO PUT THESE TRADES INTO SOME KIND OF ALERT SYSTEM LIKE TELECHART OR FREESTOCKCHARTS.COM, I can't keep track of all the orders and prices, I have to have them in an alert system that is real time. The two I mentioned above are.
Apparently we have another POMO day tomorrow. The typical POMO days have seen buying/front running the day before, and a move up until 11 a.m., after that they tend to fall, today's didn't do that.
I'm not sure what to expect tomorrow with POMO and the strong signals we are seeing that are not congruent with a POMO day. However as I have said a few times, once a pattern is established on Wall Street and it becomes easy money for the average retail trader, they find a way to somehow throw a monkey -wrench in the mix to end that relationship so we'll just have to see what comes of it. It's another one of those Bermuda Triangle moments that I've seen so often with reversals, like the September rally reversal, everyone was so bearish and there were seemingly a million reasons to be bearish, but it reversed. The big dollar reversal, there seemed to be no plausible reason for the dollar to go up. yet it did. You always find out later. Like Paulson's "Buy Stocks" Monday, and we come to find out that his fund is just at or just over 0% on the year, which means there's a high water mark in most finds ad he's probably not making a penny until he gets his portfolio above the high water mark. So he had his reasons for being out there Monday of last week pumping stocks, as I said at the time.
Again, insiders are fleeing stocks like rats on a sinking ship. They aren't doing it because they believe stocks or their stocks are going higher. The numbers are astounding. If the Fed wasn't pumping liquidity into the markets, this market would already be in the crash zone with all of the selling and fund outflows. That's probably why we are seeing more of the HFT sponsored flash crashes.
In any case, I suspect we'll see over the next few days what the real story is.
5 years ago
4 comments:
Keep an eye on the currency trade, the amount money pushed around in currencies is much much larger than our stock market and right now you have a lot of people about to be squeezed in a hard reversal of the dollar. This is most likely what has been taking place. Just think of all those Asian countries that have been buying the Euro against the dollar. It has started to slide pretty quickly in the last hour since the Ireland downgrade and their doesn't appear to bu much support in the charts as it has been raising very quickly with little pullbacks. We could very quickly loose all of the gains put in yesterday on the Euro and from the weekend. It pierced the 1.3800 level dropping from 1.3881 and has been trying to bounce from there.
Goldman Sachs letter to client:
http://www.bloomberg.com/news/2010-10-06/oldman-sachs-says-u-s-economy-to-be-fairly-bad-recession-is-possible.html
looks like the POMO arrived
More GS propaganda, why bother with the little guys unless.... You like Paulson and trying to achieve something. We'll find out soon enough.
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