Weekend Update – Same As It Ever Was!

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Monday Update...

In the video, I say that Wednesday is another POMO day, but that's not a guarantee... only a guess.  They are releasing their schedule on this coming Wednesday, but I don't know for sure that it will also be a POMO day too.  However, many times the Wednesday of the opx week will be the high for the week, and then the next two days are usually flat.

Not always of course, but I've noticed that most traders have closed out their options by Wednesday and the rest of the week just chops around until the close on Friday.  They will of course pin the SPY at a level that will benefit them the most.  The question is... will it benefit them to sell it off because there are too many calls, or push it up (or hold flat), as there are too many puts.

In the past, there has been too many puts, so they close it up.  Will this time be different?

Red

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Some things never change, as the government will always be evil and full of crooks and gangsters...

So what made me think the charts would be followed this time?  Maybe because they were working just find up until last week.  Everything in the charts last week pointed to a 50-100 point sell off in the market, yet the gangsters defied gravity and manipulated the market higher once again.

No one can tell me that last week was something you could foresee and forecast from reading the charts, as every indicator pointed to it rolling over.  This makes it extremely difficult to gamble in the market, as the gangsters can see what you have in your hand.

Sounds unfair, sounds crooked, sounds evil, sounds hard too beat... all true, but what can you do about it?  Not play the game is the only answer.  At least for us option players, as going long with options will not make you money very often.  The lower vix as the market rises will suck premium out the value of your options faster then Lindsay Lohan can get high!

So, you either have to buy the etf's outright (which is a whole lot of money, and out of most peoples' reach), buy a call spread (works, but how do you know what the upside target is for the call you are selling), sell a put spread to capture the high volatility priced into the option (kinda of insane, as once you finally decide to place this trade... the market crashes!), or just sit on the sidelines in cash (which isn't too bad really, as you've only lost about 10% in buying power in the decline dollar in the last several month... which is better then losing your whole position on another B.S. rally that wipes out your puts completely).

Maybe that's why the retail trader just took his money out of the market and isn't doing any investing?  No one believes anything the government says, so putting your cash under your mattress seems too be back in style now.  I can't say I blame them, as I'm certainly no lover of the government either.  I still think we should bring back public hanging, like in the old western days.  Let's string them up from a tall tree and broadcast it live on FOX News (their favorite controlled media outlet).

Well, enough ranting and raving, let's try to figure out what's coming next week (and that's a Big "TRY", as no ones really knows what kind of cards they'll be pulling out from the bottom of the deck next week).

Looking at the charts (which really don't matter anymore, but humor me), the weekly has finally started to look ready to roll over some.  It's in the high 80's on the Stoc's and almost has a bearish touch on the moving averages.  While I don't expect it to just roll straight over and head back down, I do expect a dip to happen, and then some choppy action until the end of the month.

Why?  Because the of election on November 2nd... plain and simple.  I've given up on a crash coming before the election, and will simply say that I expect the gangsters to continue pumping money into the market all month long, keeping it from crashing.

While next week could sell off, I ready doubt it as it's another opx week.  I've noticed that the market tends to sell off the week after opx, but rarely the week of opx.  Since we have another POMO day on Wednesday, October 13th, I'd expect a rally up on that day.

So, that means we could go down some on Monday, and possibly more on Tuesday... only to be bought back up on Wednesday.  In other words... very choppy, just churning sideways in a range until the opx is over.  Then a move down the following week could happen, and should happen... but will it?

Here's the thing that's been bugging me for months now... that dam upside FP of DIA 118.16!  You know the bulls aren't going to stop here, just shy of the 11,000 mark... and the FP is about 11,800 on the Dow which isn't too much higher from where we are now.  This leaves them about 4 weeks to get to it before the elections.

Remember, most analysts are expecting the Republicans to take back control of the house and senate, which means they will put an immediate stop the money machine.  That means a big sell off (crash) should happen as the bulls won't have anymore crack to snort (maybe they can get some from Lindsay? ... sorry, I had to go there! LOL).

Now that doesn't mean that they won't eventually start printing money again, as both Republicans and Democrats are afterall... still Politicians, and once the market starts crashing they will cave in and bail it out just like the current gangsters are doing.

But, we could see our downside FP of Dow 8300 play out... if they stop the money tree for awhile?  But in the meantime, that upside print is still bugging me, and until it gets filled I just don't see any big sell off sticking.  Next week isn't showing me any clear direction, and the week after isn't either.

I only expect it to be the week the market corrects, because it's common to see the week after opx as the "down week", as it's happened so many times in the past.  Of course there's no guarantee on that, as the only guarantee I can give you is that the government is out to steal your last dime and will succeed if you play their game too long.

I wish I had a crystal ball, so I could tell you where the market is going, but I don't.  Actually, I don't need a crystal ball... I just need someone to plant a "bug" in Ben Bernankes' office, so we can here what all the gangsters are planning to do.  Anyone out there want to volunteer?  I didn't think so 🙁

Well, I can't really think of anything else to say?  Not much going on right now.  Hey!  What a perfect time for a surprise crash!  Nah, I had that dream last week...  Wishful thinking again!

Red

100 COMMENTS

  1. The only word out of your mouth is market crash!!! You’ve been saying that for months!!! Are you ever going to acknowledge that you could be wrong jeez!

  2. Firstly, there is no-one forcing you to visit Red’s site and listen or read to his musings.

    Secondly, if you are asking Red to consider that he might be wrong, then you must also ask the Government, the Fed and all the “talking heads” to consider that they might also be wrong. After all, if you and I ran our household finances that way that our Government does, we would be considered criminals and no doubt incarcerated….

    Consistantly spending more than you earn has never, ever (in the history of all mankind) led to long term financial and economic success, and these days (or years, or decades) of profligacy will never be any different.

    To use the escaped criminal analogy: he is going to get caught – might be today, tomorrow or in 15 years, but he will get caught.

  3. Firstly, no one asked u to trade if u think the market is rigged and u cant make $ off it.

    secondly, the important thing here is not whether the government or fed or other talking heads are doing the wrong thing or not. the point is how to make $ given the market conditions, with POMO or other sorts of manipulation or not. if u cant make $, then u suck.

    thirdly, consistently outspending has always been the trademark of the US government. Fiscal conservative icon Ronald Reagan famously said the budget deficit didnt matter. so much for fiscal conservatism, hypocrites!

    and last of all, the market can stay irrational longer than u can stay solvent.

  4. So, I go to get the news on AA’s earnings, and usually there’s only 3 or 4 headlines, about it…well this time, everyone and their mother’s were releasing figures–It’s just like the IKE pre-invasion of WW2, where all that mis- leading info was released to confuse the Nazi’s….
    well same thing happened on AA earnings….
    Thank god, I know how to kill the market Nazi’s…and I sort of got it sorted out….

  5. How is the US paying for all the debt? They are going around to all the other countries and stealing everything they own….
    That’s what empires do!
    Be happy, don’t worry man!

  6. Red, I don’t think the 13th is a POMO day:

    The next release of the approximate purchase amount and tentative outright Treasury operation schedule will be at 2 p.m. on October 13, 2010.

    All it says is the schedule is being released. In my experience though, the market won’t fall much as long as they keep doing it. I’ll be interested to see what the schedule looks like. My guess is that operations continue until mid November…for obvious reasons. LOL.

  7. Vix gapped open down 6.3% representing some serious buying at open. After Fridays close that blew me away

  8. The volume on the buy side wasn’t too bad those last few days Jim. They might be buying, instead of selling? Hard too tell of course, but we’ve been tricked many times before.

  9. The dollar is making a bottom, the euro wants to go down. I believe QE2 is fully priced in. They just try to suck in more retail investors and mutual funds. Something is strange with the VIX, we have a breakdown but the market is not going higher so far. Sure today is a quiet day with bonds trading closed, still Cobra mentionned today should be a very bullish day. Anyhow, if we close flat today and tomorrow we get a down day allowing the vix to go back inside the bollinger band that’s a market sell signal big time.

    How can they manipulate this market with no more POMO day and a rally so far based on low volume?

    Let’s see what happens!

  10. I would say that todays low trading volume is due to the holiday doesnt seem to be heading anywhere at this moment however there are signs that shorting has become slightly more aggresive.Although this weds news is just the release of the schedule but we have to take note that trading done this past few weeks have been nothing more then ( BUY the rumours SELL the facts ).Feds have won big time during sept i have thrown away the charts and started to question the underlying mentally of traders during the past few weeks and im just throwing this out for everyone to ponder on.

    Feds have broken the (sept curse) 71 years .They have instilled so much confusion in the mindset of traders that right now no one knows where to go.Everyone even friday did exactly the oppside but WHY thats the reason we have to think its cause simply EVERYONE and i mean EVERYONE is thinking ( NAA dont worry about it if anything happens we have the feds to bail us out AGAIN ).

    Its really sad to think about how many people will be caught offguard when the time comes and the bulls fall over into a pit of knives its sadder when someone is helping the bull and digging that pit (Feds) worst part about all this is that they have managed to get a hell of alot of support by people who KNOW and SEE whats going on but somehow have lost sight of logic and sanity.

    In truth im riding it and milking it for all its worst cause hey to me its money i know a crash is coming.WHEN i have no idea but since everyone is going to buy now im not gonna fight against millions of traders and go against it at this point of time however im sure as hell keeping my stops tight as hell so that when it comes i have a life boat to jump onto.

  11. HI Red
    comments are NIL ?
    I dont really expect a trend change until AFTER the Jan4th ECLIPSE
    BUT
    that wont stop a short term DIVE between now & Nov 4th
    2 big cycles on 21st & 22nd see the blog comments
    http://jaywiz.blogspot.com

    see the graph I published for 1937-1942- compares with present
    Kondratieff wave & 70 year cycle, plus the waves, & fibo highs

    October is like double vulnerable in the game of Bridge
    WE are holding MOST of the cards, but east has an extra TRUMP

    Jay

  12. WOW are those custom charts i have been interested in the circles but i have never understood when and how to draw them would you mind sharing some knowledge on them

  13. They’re fibonacci arcs. You can google it. The idea is you place both ends on significant high/lows to show support resistance levels. Very frustrating tool, as alot has to do on the scale of your chart. Example, if I display a yearly chart vs a 2 year chart, even with identical end points, the arcs will be drawn differently.

  14. will they work on a smaller time frame chart i know the basic stature behind them but i cant find anything to draw them on

  15. The Fed rescue team steps in again at the end of the day. Now we all know why they hired 400 traders. Why does the Fed need 400 traders? Now we know. The stock market is a video game and the Fed is playing with a cheat code.

  16. I like this sentiment survey. I don’t know how they calculate it but it shows bullishness is just off the charts.
    The trolls came out in force last night. The crash must be near.

  17. Look at the reversal in the agricultural commodities or DBA or WAG in particular. They had huge volume on Friday and then did a huge reversal today. Last night, the ag commodity futures were up huge.
    Crude oil couldn’t participate in the early morning rally and didn’t make a new rally high. Chevron with a microscopic range day today. I looked at $hui over the weekend and it had an ugly huge reversal bar on Thursday. Some tech stocks like CRM and Akam continuing their meltdowns. Doji days all around.

  18. We saw good selling early and put options activity increasing so i guess some are positioning for a fall. A lot of bulls out there, they buy fearlessly any dip. FOMC minutes released at 2pm, it could be interesting.

  19. 1st attempt to break 1155 unsuccessfull, 2nd attempt could be it if we see the dollar breaking out. I think the dollar wants to move higher as we already made a strong bottom in the last few days.What will we find out in those FOMC minutes? That could be a catalyst.

  20. I was doing a little research on magic squares for planets to get a handle on some of the numbers being thrown around in the financial media and movies but it was hard to come up with anything in particular to the current astro event which should be affecting the markets soon. But I went over to Cramer’s just now and he certainly had some interesting numbers that sparked some ideas. He has his scoreboard today at 19 to 77 and I could see some 1987 and 1929 numbers hidden in there with today’s date 10—12 above it. Then he has a little chart segment on Cisco and the first chart (a weekly) he shows is dated for 8-22-08 to present or (8)-(22)-(8) with another 88 reference (mentioned many times in Social Network and Wall Street 2).
    Gordon Geccko is sentenced to prison in 19(88) for 8 years but at the beginning of the movie, it shows he is released from prison on October 22,2001. (see 22 above)(I’ll do more of a review of Wall Street 2 later)….Then the next chart Cramer shows is from May 6,2010 to the present which seems to be an odd date to start a chart from. And on this chart Cramer eventually points to 22 and then up to 24 (another number seen all over the place lately but the markets don’t trade on the 24th)(I haven’t viewed it with the sound on yet). That got me to checking on those dates and voila….5/6/10 is 5 months 6days from October 12 and August 22-08 is 2years 1 month and 21days or 2121 or an anagram of the SP 1212 April high and 1122 magic number or 4pi number. (by the way the number 212 is featured quite a bit in Wall Street 2—-there is a phone number shown 212-735-xxx???
    that I didn’t quite get so I probably will have to see the movie again. I need to take a notepad next time since this movie is filled with a multitude of numbers.)
    Anyway 10-10-10 was 583 calendar days from the March 6,2009 lows. 10-13 will be 583 days if one starts at the March 2009 pivot lows. October 13 also looks to be 111 trading days from May 6. 583 another mystery number I saw on Cramer’s 5-26 (58)(also featured on his scoreboard that day)show.

  21. Well as i have stated the even though money wasnt pumped into the market when it was released it had the same effect.Everything shot through the roof and negated 2 days worth of shorting.Imaging a crap load of people outside a bar waiting for it to open and a guy walks out and says ( WE WILL BE OPEN IN 5 MINS ………….Cheers ring all over the place ) when will the insanity stop no one knows.However like i said cause i dont have trillions of dollars to move the market in the right and logical way i have to follow the crowd right now although i know they are wrong i dont wanna be mobbed to death but im sitting as close to the exit as i possibly can.

  22. Galbraith – The Great Crash of 1929
    investors were described as “having vision for the future and boundless hope and optimism” and not “hampered by the heavy armour of tradition”
    Eventually, market meets economic reality – rock meets hard place

  23. Don’t think we can fall this much this week. On OPX week they want to see most options expired to zero.We should have a top around 1175-1180 this week ,consolidate and close around 1165, then it is downhill starting next week.This is perfect time to go short. Don’t think we will ever see these levels for a long time.

  24. Well somehow i also think that the DJ30 is gonna top out at around 11200 before hitting the breaks and doing a handbrake turn.I dont think there will be a sudden flash crash to start the sell off this time round but that lvl has a huge physiological barrier to overcome.Breaking the 11000 lvl was a big step forward for the bulls but it didnt get there on its own and with that in mind what will the people that are dependent on the help gonna do when its gone.Elections at this point in time are still 50/50 so that will play a big part in future.From now till then i wont be surprise if there is just sidewards movement drifting upwards till then.One thing is for sure is that 11200 when it comes my trigger finger will be glued on short button.

  25. Yes, I am…

    When is of course unknown? But based on whats happening right now, and how close we are, I’d say we are head there within the next month or so.

    I can’t see us crashing to the other FP of Dow 8300, and then going back up to the 118.13 print. I think we are going up first, and then a huge crash to follow.

    What will cause it? Unknown? Maybe war? Maybe a nuke set off in America or some other country? Who knows what the gangsters plan to stage, but they will “stage” something… it the market will then proceed to crash.

  26. Yes it is a horrible thought, and not one that I want to see happen. But the gangster are desperate, and will do anything to keep themselves in power.

    They are evil, and thrive on violence and terror, so I’m not putting anything out of the question here, as they are capable of any act of disaster. Let’s just hope they fail at it…

  27. For it being the end of the world for the bears, the agricultural commodity complex is down today as measured by DBA and Dag when it easily gone to a new high today. I don’t think crude oil made a new high either. Those were massive reversals last week and their holding. Euro with a doji today. It was reported yesterday that Thailand has been hit with an onslaught of foreign money surging into its bond market chashing yield. Very bubblicious. Anyway, I see a massive convergence of esoteric cycles for October 14 which I might write about later. 111 tds from May 6 should be tomorrow but I need to reverify.

  28. Sorry, I was originally correct. Today is 111 tds from May 6. It looks like CSX had a mini blowoff with large volume and an exhaustion gap to help juice the transports.

  29. $vix closed positive after being substantially negative. TLT had a massive reversal hollow bar. AXP has been manhandled recently almost making 52 week lows last week. Meanwhile GS is propped up to hide AXP’s abysmal performance which the financial media is deliberately hiding. (i need to check on AXP). 111 is also the total of each column for the Sun’s magic square and every number in the square totals 6×111. The current astro event started in Scorpio at 13 degrees so a top on 10-13 might be fitting??? I have a magnus opus to write on all the cycles for today and tomorrow which would include movie reviews for WallSTreet 2 and Social Network (or at least incorporate the numbers in them)

  30. On the last chart for Cisco, the number 14 is listed below 18 even though the price history in the chart does not reach that level. Cramer mentions “pain” when he points to the 18 number and also uses the word “crash” when talking about the 13 week average or 34 week average crashing into the downtrending resistance line. 13+34=47 and markets dropped to July lows 47tds from April 26 high and October 14 will 47tds from August 9 top. But 46 is also a key number ie 33+13 so it could work for October 13.

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