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Follies Of The Human Mind
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Follies Of The Human Mind

by The MoleNovember 18, 2009

Oh the follies of the human mind – what a tangled web we weave when we are trying to convince ourselves of something. In other words – whatever the status quo may currently be, we find ways to justify its continuation. Take for instance our favorite precious metal – GOLD – the pure mentioning of the word continues to inflict a roller coaster of emotions on the average investor.

Almost exactly a year ago when it touched 700 it was the bitch boy of the investment community – everyone KNEW that it was going to zero (except of course the intrepid gold bugs led by Jim Sinclair). And now you simply can’t go wrong putting your money into gold – heck, in Europe they’re even selling it in vending machines to the public.

What really cracked me up was an article posted over at ZeroHedge today titled ‘Why Gold Is Very Very Cheap‘. The discussion is actually quite enlightening but its parting message is that one would be foolish shorting gold and betting ‘against Bernanke’. Say what? Wait a minute – just until a few months ago I kept seeing a flurry of angry articles making the point that Gold was competing with the Dollar and that massive gold manipulation was a scheme by the PPT and Ben Bernanke’s crew to keep it competing with our fiat currency – the ole’ buck. Deepcaster was particularly prolific on that subject and particularly his takes on why gold was tantamount to Charlie Brown’s football and Ben Bernanke as Lucy pulling it away just as it was trying to kick higher.

Now gold is going exponential and of course the mental masturbation of the past has been replaced with brand new mind constructs. Let’s just review the sentiment change across the past year:

Okay, at around 700 nobody wanted to have anything to do with the shiny stuff. And at 800 it was still too expensive. It was getting ‘cheaper’ and more desirable at 900 and now at 1140ish it’s suddenly a steal! Can someone explain me this – because I just don’t get it. But I’m a certified pain in the ass contrarian – so perhaps I constantly have this elitist urge to tell everyone else they’re wrong – admittedly I’m a lost case.

For the record – I insisted all along that it would drop like a rock – and on that one I was completely wrong. I still do believe we’re going down down down – but my timing – well, let’s not talk about it. And yes, we might go higher here as futures have a tendency to extend before they turn – a blow off top is definitely possible. My point here is however that jumping into gold now – after it’s rallied over 60% in the past year might not be the best idea.

Okay, I got to run, have to buy some ‘supplies’ – ahem – does anyone know where I can get 2nd hand mining equipment? But wait – I’m a mole after all – never mind! Plus I get 200 jack asses as part of the one time offer above. Heck, what am I going to do with even more retail traders in my evil dungeon? Time to start a sweat shop I guess. Gold rimmed tube socks anyone?

Cheers,

Mole


About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.
  • Gerbil_gold

    Good Post. i'm sure same applied to tulip bulbs (look it up).
    Most people here remember the Tech Boom.
    “it's a new paradigm, buy buy”
    desire: sometimes is based on taking stuff the other guy wants too.

  • wrc1k

    Everyone should have a copy of this: The Treasure of the Sierra Madre – “Badges? We ain't got no badges. We don't need no badges. I don't have to show you any stinking badges.”

  • string01

    Let's go buy some land in Nevada and tout a new process for washing dirt in the alluvial fans.
    R/M into a pink sheet and be the next big thing!

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    master mole, review a EWT count on gold with price breakthriough we had

    I don't care if it is hellbound to 900 afterwards, right now it's on it's way to 1300+

    yes it is dangerous, it will drop as a stone BUT we must think price, not value

    BTW long term we're going nuch higher IMHO

    p.s. do an exponential regression and draw trend lines on log scale

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    btw, did you take a look at my proposed regression?

  • http://retracementlevels.zstock7.com/ zstock

    Don't short the gold metal, short the gold stocks–My NEM,GG,GOLD,ABX,PCU shorts all winning!

  • Gerbil_gold

    I looked at your regression, did i fire up excel and run the cookbook? no. 😀

  • molecool

    You are a trader – so, yes – I'm sure you do fine trading the last push higher. But I'm talking about investors here – the buy & hold crowd.

  • molecool

    Oh, I LOVE that scene – let me find it.

  • http://retracementlevels.zstock7.com/ zstock

    PCU $36, I can imagine that at $24 again.

  • molecool

    Agreed actually – gold stocks are among the worst sector ever – double whammy: Gold up – equities down: gold stocks down. Gold down – equities up: gold stocks down.

  • http://retracementlevels.zstock7.com/ zstock

    MON “V” recovery, back to $80 = 200 day, already

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    the more I look the more I see this as a time extended 68-81 crisis

    so buy and hold might be interesting, lower channel is currently 945 and rising exponentialy, so a clear (and not too expensive) stop loss line is available

    just my 2 centigrams

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    did you get the data?

    just a collumn, just a line chart, just an auto trenline, just format axis

    difficult?!?!

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    we're at junction point… market should decide (or let it crawl along until decision)

    right now it's casino

  • yudhisthira

    spx can't get out of triangle. surely this is not a series of 1's and 2's.

  • WTFed

    Cheers Mole. Classic form.

  • de3600

    http://www.youtube.com/watch?v=-lj056ao6GE here you go Mole Blazing Saddles – We dont need no stinking badges

  • vision_invisible

    It is entirely possible that gold at $700 was too expensive and $1100 is cheap.

    Circumstances have changed have they not? A private deflationary destruction would have made $'s rare and gold a junky relic sold to pay back the money we don't have (since the system is unstable at core, you borrow $1 into existence but over time must pay back $1 + interest – without more borrowing the system implodes cause there isn't enough money at any time to pay back the IOUs).

    It now looks like for a number of private parties (banks), the deflationary consequences of the system will be imploded inside the safe-haven of the Fed's balance sheet. Oh sure, things are going to get worse from here and there will be deflation. Yet, on a grand scale it looks like we might be amazed at the tactics BB will take from here on in.

    To be sure, if the lack of dollars is going to mess up the system, cause the unemployed to not have enough dough$, cause States to succede because they are in debt, cause real estate to fall (when they own so much), do you think the Federal Govt will standby and let it happen? Or do you think they will go for the quick fix.

    Circumstances have changed (and could change again…). Contrarian is fine, but pointing at a chart and making all the conclusions is akin to using your eyes but not your frontal cortex. I am sure if we can agree on the core reality then the gold price will seem to be a straightforward consequence of that.

  • centerline

    You should sell stainless steel handles to mount to desks that can be pulled to send an “enter button” signal when initiating trades!

  • gmak

    Wonderful post on Gold, and a great comment on the general madness of crowds.

    People go crazy all together, but recover one at a time.

    This reminds me of calls we keep getting from real estate agents about buying (up here in Canada) as the market does it best to imitate the US in 2006 -= 2006.

  • gmak

    EUR has just gone below a TD risk level (where buyers are supposed to ocme in) at 1.4941; It looks like there are buyers trying to push it back up. Quite a battle, IMHO, for ES /SPX going into the close – based on this.

  • kryxtal

    Dip buyers are out in force today.

  • vision_invisible

    Madness of crowds? LOL. Madness of govts, elite and retail traders perhaps….

    And these 3 groups are in the 0.001% of the population. I am sure most people would take a new Plasma TV over a 1oz Gold rock.

  • gmak

    What has changed in the last 6 months that would affect gold. Nothing. All the slosh funds are still there – some are winding down. The only thing that I can see is some publicity about CBs now buying gold.

    So, based on this, the gold is cheap story is really based on the fact that the MSM is publicizing what some CBs are doing.

    “Monkey see, monkey do” is not, IMHO, a viable reason for putting capital at risk.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    with a black box, with a timer and stoplosses, and auto stoplosses upping, and trendline control. you'd see on a special window an hamster pilling in or out your coins (and a box with the coin so far)

    in case of an enormous rise or fall a whole herd of hamsters woud get busy

    sounds fun

    plus an hamter in top hat inviting trades

  • raised_by_wolves

    I'm dedicating my first ThinkScript ever written to Stainless Steel Hamster.

    Here's my line of code in all it's sheeny splendor:

    plot data = close / close(“GLD”)*100;

    I hear Roy Batty saying, “Proud of yourself, little man?”

    Yes, actually, yes, I am.

    And here's the fruit of my labor of love:

    http://screencast.com/t/YTViODkwZ

  • Schwerepunkt

    What setting do you use for Demarker? 14 period? I just put it on my EUR chart. the only thing I don't like is how it zeroed when Eur went to 1.4942. The indicator stayed at zero while EUR dropped another 6 pips. I guess it can't go negative and I'd see that as a drawback.

  • Me_XMan

    Ben Bernanke saying there are no obvious asset bubbles seems “weird, and not in a good way,” Roger Nusbaum writes, warning that bold and unfounded confidence may come back to bite Bernanke. “The notion of anyone with influence saying 'Keep on buying folks, it's all good in the hood' seems outrageous,” he says.

  • gmak

    But what's your point? That the SPX is down in terms of Gold?

    Sure. But it's also down in terms of EUR, or GBP, or CAD.

  • raised_by_wolves

    Don't burst my bubble!

  • vision_invisible

    That is a howler – nothing has changed?

    Anyway, what changed over 10 years to cause this?

    http://www.kitco.com/LFgif/au3650nyb.gif

  • vision_invisible

    LISTEN TO THE MAN: He is saying that the STICKER PRICES OF THINGS IN THE FIAT HE MANAGES ARE JUST FINE….he is not saying that relative to gold. BASED ON WHERE FIAT IS GOING…he thinks prices are a-ok!

    Who's listening?

    (obviously there will be dips, washouts, to generate demand for further printing….to them it is just a technical problem that there are not enough dollars so everyone's balance sheets are stuck)

  • gmak

    It depends which study you are talking about. (which indicator are you referring to?)

    The risk indicator comes off of one of the TD studies that I have active on the 3 min chart. I'm using TD Combo, TD LInes, TD Pressure, TD D-Wave, TD propulsion.

    I would guess that the risk indicator is part of TD Combo (which is the TD setup with some mods to the countdown). I use 9 bars to setup, 4 bars on lookback, using the CLosing price for each bar.
    This risk indicator that I was referring to is set up automatically by Bloomberg and it is based the lowest point of the last SELL setup count – usually bar 1.

  • gmak

    Referring to between now and when Gold was recently $700 just 1 year ago.

  • http://centrifugaldeforest.blogspot.com/ Centrifugal_Deforest

    The most intelligent thing I can add ere is the the gold stocks tend to lead the metal. GDX is clearly lagging vs. the metal.

    Combine everything with the fact that this is a such a trending commodity and w a little patience you have a very nice play waiting in the wings here

  • gmak

    float away! :-) <thumbsup>

  • gmak

    While you're at it why don't you put up a graph of the previous 10 years, and then the 10 before that.

    Gold responds to the madness of crowds.

  • Schwerepunkt

    I see. I don't have those. Sounds interesting. I use Quotetracker and just have the simple “Demarker” indicator, which is quite similar to RSI, only it goes from 0-.5-1, instead of 0-30-50-70-100.

  • centerline

    just make sure it has that Vegas fake coin dropping sound! LOL

  • vision_invisible

    Everyday the reality sets in a little deeper:

    How about this Fed May Not Increase Rates Until 2012

    http://www.bloomberg.com/apps/news?pid=20601087

  • http://retracementlevels.zstock7.com/ zstock

    Hi Mole,
    Last month, most of the analysts I follow were saying gold $1200, I thought they meant next year___If gold does reach $1200, my gold stock shorts won't work–I have those formula's based on $1100 gold.

  • http://retracementlevels.zstock7.com/ zstock

    JEC, down down down, a burning ring of fire!

  • vision_invisible

    Sure people get a little frothy when things start heating up. But you're not saying that, you're saying Gold responds to madness of the crowds. I'm not sure what to say about that, except its almost 100% the opposite – it responds to the madness of Fiatdom and central bankers.

  • Me_XMan

    Employment data on deck for tomorrow. Who the heck cares since market will ignore it anyway.

  • gmak

    I hope it works out for you. Unfortunately, if the apocalyptic reasons for buying gold come true, many will wish that they had lead instead.

  • LogansRun

    Looks like we might actually close positive today. I was getting worried after being down so far today.

  • Schwerepunkt

    Measly 10-pt range on ES today. Pitiful for trading.

  • Schwerepunkt

    Don't count on it.

  • http://chaugner.blogspot.com chaugner

    its been like this since the GAP open this week. Its forming a nice bull flag here and could complete a complete 5 wave cycle towards 1130 (just as mole has pointed out) off the lows.

    I want to keep telling myself this was a failed 5th wave on monday, but with the consolidation right after it hit the peak on monday without any meaningful sell off. This does not look toppy at all.

    Generally during OPEX we see larger moves – but nothing at all yet, and if a move were to transpire, looking at from a pure charting perspective – its rather bullish.

  • vision_invisible

    I don't own any physical and I dont own gold stocks. I'd rather short bankrupt companies. I just want an open man-to-man discussion about the reality. Since questioning is the way to clarity, we're all a little bleary eyed you see (im sure centrifugal deforest is in this camp).

    Don't relent to visions of apocalypse and say we'll all be living in caves petting our gold teddy rocks. Think about it that someone might take something hard earned $ away from you, and you're thinking of how to preserve it. Gold is that thing. Over the last 10 years, the market believes they took away 400% of the purchasing power of these rocks, so the rocks won and the $ did not.

  • http://twojackstrading.blogspot.com TwoJacks

    “Now gold is going exponential “

    thank you for stating this correctly. The phrase, “going parabolic” drives me absolutely batshit. Mole, you are one smart cookie.

  • derekste

    dip BOTS… hehe

  • derekste

    I hear people abuse the term “exponential” more than I hear people use the term “parabolic” at all.

    Most people say exponential when they really mean x2

  • http://retracementlevels.zstock7.com/ zstock

    I'd be surprised if GLD gets above $114

  • http://dreadwinaard.livejournal.com dreadwin

    Got stopped out of my DRV trade for a 7.8% loss :( SPG single handedly propped up IYR all day, and when it went over 75, it looks like it triggered a squeeze which carried IYR over 44 (which had held against the first attempt to breach). I think that SPX will follow with a strong move to the upside late today or early tomorrow.

  • Me_XMan

    Wow! Another Wow! day for me.

  • Schwerepunkt

    Ouch! Better luck tomorrow.

  • bshah

    where the hell have you been WOWed…?

  • Me_XMan

    All dips got bought…very few sellers.

  • Niktus

    People that keen to hold the bag?

  • gregn

    Coming to the resistance of flag. I say we break to the upside as my theory supports a high on the 21st – 23rd: http://screencast.com/t/MjUzNDFjZG

  • http://centrifugaldeforest.blogspot.com/ Centrifugal_Deforest

    HEAT on the beat

  • http://retracementlevels.zstock7.com/ zstock

    BTU gettting very close to my 48-50 short sell price.

  • tradejane

    Yeah, I see that. 😉 Thanks again.

  • LogansRun

    Here is comes… /ES going green 3-2-1 blast off

  • PRSGuitars

    Surprisingly pivotal moment here, guys… under the hourly 20 and 50 sma, and weekly vwap. Right at the bottom TL of a major channel, too. (see chart)

    Looks like we just broke through the MAs. Might be following this channel still…sigh…

    http://screencast.com/t/ZWZhMDYxZTMt

  • Schwerepunkt

    Somebody give me a machete so I can hack through that jungle of lines. ;-)) Nice work, I can make it out alright actually.

  • bshah

    all i say is Me_XMan's WOW… UNREAL… THIS IS NO FUNDAMENTALS… THIS IS FUCKING-A-BALLS. Methodical move up with no one to question. fuck…

  • centerline

    Resistance here around 1009-1110 range is pretty strong so far. Knocking on it pretty hard lately. Lets see if it holds… here we go.

  • Me_XMan

    LOL! Resistance? There's no fricking resistance since 3/9 this year.

  • kryxtal

    3:30 PM ramp up works every time.

  • Nightwind

    LOL, I was going to say the same thing

  • Me_XMan

    Wow! WTF! I'm speechless.

  • bshah

    Right at 0 for AMZN… Mother…

  • http://centrifugaldeforest.blogspot.com/ Centrifugal_Deforest

    Don't cry 2me when it eats your young

  • kryxtal

    This is the second “down” day of the November. The first being last Thursday.

    This month has been quite absurd.

  • LogansRun

    President Camacho says “buy now if you like money”. Sigh… I think I need a Starbucks adult latte

  • Schwerepunkt

    With brandy.

  • gregn

    Today was P3.

  • Nightwind

    New TA terms:
    Support Line……Bull rest stop as they run to the ATM
    Resistance Line….Bear preparing for a colonscopy

  • Me_XMan

    You have to say this day belongs to the bulls.
    This market should have been in the reds for 200 points with that housing data and high unemployment.
    Whatever it is holding market at this high level is one hell of a force.

  • Me_XMan

    LOL! I love that movie!! IDIOCRACY! Damn funny!

  • Me_XMan

    Ya through the penis…

  • bshah

    Did you just join the EW club ? joke only.. so don't kill me.. aah.. won't matter.. am already dead…

  • centerline

    Sad, but true. Downside has firm resistance. Upside has occasional “sponge-i-ness”. A jello like quality!

  • http://dreadwinaard.livejournal.com dreadwin

    I'm thankful for my stop! I'd have lost another 2-3% without it today, and I expect more upside in IYR tomorrow as the SPX goes to 1120/1130/11 bajillion or whatever the latest target is.

  • tradejane

    Please, you offend me. I hope I know better than to do that.

    I hope it continues to work for you, I chickened out at 13.85 – enough excitement for one day. 😀

  • TransworldDepravity

    It's to the point where I need a lobotomize my brain to excise this notion called SRS. On the day the market was down due to housing starts, IYR is the strongest. Thank god I have my hedges in place earlier. I'm out (painfully) below 8.30 and hope to never touch it again until up is up and down is down again.

  • molecool

    See – I was right when I said that gold induces a roller coaster of emotions among traders/investors – LOL :-)

    You two play nice now!

  • molecool

    Yeah, but I meant parabolic 😉

  • Nightwind

    I've given up on TA, Gann, and EW. Trying out this new chicken bones system.

  • http://oahutrading.blogspot.com/ steveo77

    Just saying….if you are holding Dec puts, this is an awesome time to roll forward to January or later…You are now entering Theta burn zone….roll forward, run away from Theta burn.

  • TransworldDepravity

    Nice trade Jane. Better than my day. It started off promising :unamused:

  • amokta

    have you noticed when the dow goes up, it does so in 50s, 100s, 150pts
    when it goes down, it goes down by 10,20s,30pts
    its a conspiracio

  • standard_and_poor

    Most longs were sold today, I'll buy some back tomorrow if necessary.

  • yudhisthira

    Unimpressive rocket out of the spx triangle so far.
    Saving it for the gap up tomorrow morning I guess.

    Then P3.

  • WTFed

    No, P3 is just where he parked.

  • LogansRun

    I'm just laughed thinking about all wave people showing charts pointing at sub 1000 S&P. It's not going to happen. What possible reason is there to sell? Does anyone think that there will be any economic news that is even remotely negative? At worst the fed could raise interest rates.

  • WTFed

    Can't wait for that good 'ol STU, just like like last 'ol STU. It's good enough for me. dee.dee

  • gregn

    I agree.

  • gregn

    When the surplus of idiots buying practically worthless stocks runs out, the smart guys will sell as there is nothing left that will push the market higher.

  • molecool

    Not sure where to start, but here's one reason – and don't take this the wrong way or as a personal attack: Your comment.

    Why? Because the bulls are so convinced at this point that this thing will start blowing higher. Whenever traders/investors think that there is 'no way' that a market can turn the other way – it usually does. Sometimes it takes longer than the contrarian anticipates – yes – point taken (and I've always said that), but the fact that it will happen is a statistical and empirical imperative. Just take a glance at the gold chart – can't go down, right? Well – let's see and talk again January 😉

  • LogansRun

    There must be an endless supply of idiots.

  • labdude

    Truth be known–probably money from the taxpayers.

  • molecool

    There's a sucker born every day 😉

  • molecool

    I got a summary:

    Bla bla bla – we drop any day now – bla bla bla – short gold – long dollar.

    Okay, I'm kidding here. You could pull the same joke about my stuff, so here's to some healthy dose of self deprecation 😉

  • clutchshorter

    “BEIJING (AP) — President Barack Obama says he's worried that spending too much money to help revive the economy could undermine a fragile U.S. recovery and throw the economy into a double-dip recession.”

  • LogansRun

    Mole, agreed. It's just so hard for my brain to rationalize buying at these prices. The same behavior was demonstrated greatly during the dot bomb days.

  • WTFed

    I don't think you get half as excited as ol Hochberg does sometimes. I'll say you're 90% more cautious.

  • vision_invisible

    Come on, if there is one skill ES people should have is seeing through the web of lies. This is just 180 degrees north of the truth, Obama does the disinformation (relating what is on the mind of the average Joe, saying we are concerned, our hearts are with you blah blah) while Bernake tells it like it is and continues his helicopter tactics.

    The Fed is continuing the money for nothing policies till 2012, they said it today. If they raise rates, all of their efforts to get people into cheap housing will be screwed, their efforts to reliquify the banks will be screwed, the amount they have to pay on all of the debt will be screwed, and we WILL FAST FORWARD to a double dip.

  • tradejane

    Thanks. I tend to trade the same stocks/etfs – it felt good to strike out and do something different. I think I´ll continue to do this – try out some new things until the market decides what to do. A hunch says it shouldn´t be long now. We´ll see.

  • tradejane

    I´m so sorry to hear that. At least you had a stop, that´s wonderful! I blew up a couple accounts until I learned how to use these things.

  • gregn

    We need to hurry up and get people into houses that they cannot afford and create a 'deficit neutral' trillion or so dollar health care system so that we do not have a double dip recession. Time is of the essence.

  • clutchshorter

    Yup – even if interest rates are low, how are people going to put a down payment on a house, let alone make monthly mortgage payments if they don't have jobs.

  • gregn

    Down payments? No problem, just print about 20k for each low-class family.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    nice cub

    and now you see:

    1. the silent fall of 2005-2006
    2. the real start of 2007 way before the october 2007 crash
    3. the similarities, on a compressed scale and without retracements, between the 2002-2007 recovery and our current situation

    good work

    p.s. can you do that from 2000 (or even before)? I'd love geting my hands on high res charts

  • centerline

    Right on.

    On virtually every blog, everyone is looking up, up and away. Few people anywhere are talking at all about possible downside. And those that are, talk about a few points only before the next wave up begins. Conditioning for bulls to hold tight (or buy) on drops and for bears to cut and run with pennies on any pullback is almost complete.

    This despite the fractal that so far is playing out almost perfectly so far, by price and time, which would indicate we are at least in a short term topping pattern. In addition, we have growing divergences, dojis, hanging men, hammers, etc. everwhere, etc.

    People are so spooked into even saying “bearish” that is has almost been erased from the dictionary over the last couple of weeks. The traffic around here says it all.

    These are signs of a top IMO.

    Please note that I am NOT calling this a top. We are in uncharted territory here and it is possible the laughing gas could be run way beyond normal limits (my uncle point is quickly approaching by the way). Just saying that when it clearly is stupid easy to buy the market and make money – the rug is about to get yanked out. The risks change here. Market neutral with tight stops is probably a safe place right now IMO.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    and thanks for the dedication, my typical error, start by saying good work, pointing things for you to do, and forgeting to mention that I was touched by the dedication

    crazy hamster

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    real spx is… inspiring

  • vision_invisible

    Obviously many people will be kicked out of homes with job losses but that could take a long time to operationalize (extend foreclosures for years why not?), and there is always the “Rent from the Fed Landlord” option they are getting going.

  • http://www.bostonwealth.net/author/dr_livesey/ Dr Livesey

    Hi all,
    I thing this is the last up move for tomorrow/OPEX day with the target of 1119-1121 in cash, here is my analysis for tomorrow: http://epiccallonfate.blogspot.com/2009/11/last

  • molecool

    “The traffic around here says it all.”

    Exactly – most folks have moved on to a certain blog which is nothing more than a chat forum. But I'm actually at peace about that as this is exactly what I predicted early this year. There would be a time when being bearish will be insanely unpopular and the bears would again be ridiculed as the idiots who got it all wrong. Well, I think that time is now, and the certainty of the bulls is what's making me smile.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    BAD WIND!

    poor stainless steel chicken

  • Me_XMan

    Yeah when SPX printing 1120 and I would like to see what you say.

  • molecool

    Don't you know that EWT is complete bullshit? Nobody believes in that crap anymore…

  • molecool

    I think he's going to say the same thing. What would be the difference?

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    it was every minute early XX century, now it must be every second

  • http://www.bostonwealth.net/author/dr_livesey/ Dr Livesey

    you are funny – what are you using for trading, a crystal ball ???

  • molecool

    Wake up call – so far the year belongs to the bulls.

  • molecool

    Wake up call – so far the year belongs to the bulls.

  • molecool

    Tea leafs mostly and I burn some incents made of Bernanke's pubic hair.

  • observingguest

    As an observer here for awhile I've found it interesting, enlightening, and an outstanding look at a real time reality show of emotion. It seems to me that the bears cannot have alot of downside risk here considering where the markets have come from since March. The complete reversal of sentiment compared to March speaks volumes though doesn't provide complete guidance relative to timing the exact top. I suppose we will know it when we see it. It also seems the bulls have the most risk at this point since I suspect the market will turn (possibly in the over night hours) and they will be trapped. The markets do not allow for a mass exit, something that should be worrying the bulls possibly causing them to panic.
    Cudos to molecool, Berk, Centrifugal_Deforest, Stainless_Steel_Hamster and all the rest of the characters! I get a laugh out of the names and the enjoy the input.

  • amokta

    letbuyit.com – you know it makes sense when you buy in a group dot.com !

  • Tronacate

    Report from my bro regarding Eaton. They will be relying on overseas divisions for the majority of their income. No foreseeable US demand. We are falling into a Mexico style economy……..the few super wealthy and the rest working in shitty service jobs.

  • Tronacate

    I thought he shaved that area……..you straining his tub drain?, or does he save it and mail it to ya?

  • centerline

    I recall the moment I knew a top was in for the housing market…

    A neighbor of mine said to me.. “You see that house at the front of our neighborhood that just went up for sale? I looked at it and talked with bank already. I think I am going to buy it to flip and make some quick cash.”

    I thought to myself…the average Joe is flipping houses now. This is the end.

    Of course I was too stupid to listen to my own advice and trade the crap out of it. LOL.

    The current state of affairs in equities has the same ring to it now. Just buy the dips!

    Well, maybe so. Just like the housing market, there was a time where those a little closer to the game could get in and make some quick cash. But it just seems to me that the music is playing faster and the number of remaining seats are looking more scarce relative to the larger number of people moving round the circle.

  • loveshorts

    Same feeling and fully in short position.

  • Tronacate

    Exactly……..a guy I know who paid a million in short term capital gains a couple years ago from flipping real estate is now at the banks begging for loan modifications……..how the tide can turn.

  • Nightwind

    Which division of Eaton does your bro work in…Electrical or Fluid?

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    sad but true

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    the year, the money and my fury posterior… sad

  • molecool

    We live to serve and starting to tomorrow you can add Gmak to the list.

  • molecool

    Yes, we got a special deal.

  • rosocecasita

    Sellers will start selling, there won't be a reason.

  • loveshorts

    It's 12 months from oct 07 high to oct 08 low in sentiment term, and 12 months from Nov 08 retest low to Nov 09 high in real price, so it is time for another 12 months downtrend if the market seek order.
    In fully short position now.

  • rosocecasita

    Obama = Zaphod Beeblebrox

  • Tronacate

    He's retired now, but has friends in both…..

  • http://dreadwinaard.livejournal.com dreadwin

    Yeah, it sucks, but my SPY calls will mitigate the loss should we hit 1120+ like everyone and their cat thinks we will. In the bigger picture, I've had 12 trades using DRN/DRV, and this is just my second loser. Live by the sword, die by the sword :)

  • Niktus

    Wait… I recognize that… thats a a Vux guy from one of the greatest games ever, right? The Ur-quan masters something like that.

  • Nightwind

    I just know guys on the electrical side.

  • rosocecasita

    Only the most controversial President of the Galaxy!

    -Hitchhikers Guide to the Galaxy

  • centerline

    Yup. I will say same thing. Along with some choice words about pulling back out of short positions again (and then heavy drinking till I pass out). Heck, that could be tomorrow! Maybe at open! LOL.

    It is quite possible I will miss some more upside. I just can't bring myself to go anything seriously long from here. Just daytrades only – and small positions at that.

  • de3600

    Use the housing credit as down payment because you can. Live in the house for free for 3 to 5 years :)

  • Niktus

    Darn I googled the thing its from Douglas Adams The Hitchhiker's Guide to the Galaxy. Still a great reference.

  • Niktus

    Still great! :-)

  • rosocecasita

    I heard the best description something like this:

    Obama and team are like Ushers at a theater thats on fire, kindly and helpful, but useless and clueless about fire fighting.

    Bush + Clinton replaced the emergency water system with direct gas lines.

    and the Feds locked the door to the theater from the outside with chains & bolts to ensure it's safe.

  • tradejane

    That is awesome! I never could get the hang of these things.

  • amokta

    “Deflationists such as Dr Doom Roubini and the rest have frightened investors away from monetizing on one of the biggest stocks bull runs in history following the March low, and continue to do so to this very day where near every rally peak has been followed by the crash is coming mantra
    AGAIN NOTE THIS – BE UNDER NO ILLUSION – The central banks will NOT STOP MONETIZING DEBT ! Once started IT CANNOT BE STOPPED ! Forget what the Governor of the Bank of England Says or Fed Chairman, Quantitative Easing is here to stay and therefore INFLATION WILL EMERGE, IT IS ENIVTABLE ! INFLATION IS THE DOMINENT SCENERIO BEING PLAYED OUT NOT DEFLATION, regardless of what ever is stated today.” walayatstreet.com——hello higher stock markets!

  • vision_invisible

    Obviously this is both and all at the same time. Deflation in assets – as social mood changes and the consumer is overleveraged and can't buy jack. Inflation in fiat dollars, in “gold dollars” as fiat is created to fight the deflation. Lastly, less clear to me is that we will have a medium term currency crisis as people run from the exits in US dollars which spawns a repricing of everything – hyperinflation – which would stoke commodities and potentially the entire stock market (I think we are aways off of that).

    First the bear. Then the Marshmallow Man from Ghostbusters. Or maybe we're attacked with bears and marshmallow men in waves…

  • rosocecasita

    it should start with a burst of spending, and the money velocity increases.

    What better time then Christmas! (Especially if we see CPI spiking up, it'll be 'Healthy and normal of a recovery')

  • fast996

    Your right about gold., when everybody wants it it's time to sell.

    I think every trader in the world is looking at this triangle in the SPX to break up. I 'd be laughing my ass off if tomorrows employment data stunk and we break down about 125 pts. Probably won't happen but those 2 testicles hanging on the daily chart are just begging for a confirmation down. Cheers

  • amokta

    thanks – the question is, should one be in cash, or fully invested in stocks/assets, or short on assets/stocks medium term (lets forget any 2 week stock pull backs)

  • vision_invisible

    a smart man is probably nimble and sleeps next to the overlord with one eye open (CD shout out to you) stealing breadcrumbs, then gets in a few jabs, till a new beating starts

    i think the pullbacks gotta be played, isnt that why we're here? If we really believed that doom was upon us and there was no end in sight and deflation will rage…why not just buy long term puts on all the banks and many consumer tied stocks and just wait it out…

  • amokta

    this guy is saying that inflation is going to happen rather than deflation – so assets such as stocks should rise, hence unlikely to be any major stock crash, at least in nominal terms??

  • vision_invisible

    Stocks are bought for discounted cash flows. If you buy a stock with a PE of 10, you are basically saying 10 years of future earnings is the good price of the stock today. Of course, in many stocks you never actually GET THOSE earnings in dividends, you just hope that the stock price will grow and you'll sell the puppy to someone else. Kinda like a ponzi scheme. A true bear market would be where nobody wants stocks and with reduced demands, prices of stocks would fall.

    Just because we have monetary inflation, a buck is worth $0.50 does not change anything about future cash flows. With decreased currency, it might be that companies having rising costs, but the consumer has not doubled their earning power so the demand for crap from that company might go waaaay down. Earnings might drop with increased costs and reduced consumer demand because of inflation. The only things that are sure to get repriced, are things people will buy no matter – energy, mdconalds etc etc.

    Thats why the market moves to date – everything up is the weirdest thing if you ask me. Im still going to short junk at the top.

  • hank30

    Think you are right on track about the next move up. After this week, longs should be running for cover. Next few days could be painful for the bears.

  • bergs

    Well we got the drag em out big ass complex fourth wave out of the way.

    http://screencast.com/t/MzIxZGExNDAt

  • amokta

    thanks – good to have some clever folks on this blog to explain things !

  • gregn

    After getting sick of losing money on winning trades by buying puts, I did a little research and have already talked to vision_invisible about this earlier. My most recent example of this type of trade was with CAT. I went short on it on the 9th, playing the double top setup. Since then, it has fallen as far as 58, but has bounced up since. The January 45 puts that I bought have done nothing but lose value… CAT is about .40 lower than when I initiated my short position, but I am down about 30-40% on my puts…nice. However, if I went short some calls, I would be up 30% now. Here is a rather large chart showing CAT, CAT put and CAT call values for example: http://www.screencast.com/t/OTg4OWI5

  • http://stainlesssteelchicken.blogspot.com/ StainlessSteelChicken

    Fear not, I am quite alive and more evil than ever. I'm honing my ninja skills, so just call if you need anything.

    /fades into the ES background like a wisp of smoke/

  • Nightwind

    bergs, is it possible that this up move from 1029 could be a abc zigzag? It just looks different to me. Thx

  • vision_invisible

    CAT is a great example of a debt ridden company that I would be willing to bet is not going back to 2007 pricing. But suppose it does, I'll sell time till May and give them a chance to proove me wrong. $1.58 for $75 May 2010 calls. Sure I'll take that! If it is $80 in May, I might enter a short position at cost basis of $76.58 but I'd be happy to take that trade. ON the other hand, a nice rapid plunge in the market, you're closing out at 50% profit.

  • rangefinder

    Hi All, Bob here again – I'm hoping this might stimulate a discussion as opposed to a bun fight – so…… bear with me!! 😀

    I was thinking about the widespread use of previous bear market rallies as an anolog, a road map for how this market is going to progress.

    Helicopter Ben is touted as being an expert (for real) on the 1929 crash and as he has his hands on the levers of power (he's the one deploying those air2bear lasers) its clear he's absolutely determined that we are not going to go down the same route as 1929->32->38. “No depression for us, not on my watch” is clearly what he's thinking.

    So given his influence and determination and given the coordinated massive global response to this crisis (which by the way in my books makes this market unique, way more improbable than that little black swan) why would the 1929 and similar crashes have any validity as a model that we might look to as a guide for the direction that this market will take?

    It seems to me that if you want to know where we're NOT headed then that's the place to look.

    Discuss/Ignore/Throw buns

  • Implosion

    “And at 800 it was still too expensive. It was getting ‘cheaper’ and more desirable at 900 and now at 1140ish it’s suddenly a steal! Can someone explain me this – because I just don’t get it. But I’m a certified pain in the ass contrarian – so perhaps I constantly have this elitist urge to tell everyone else they’re wrong – admittedly I’m a lost case.”

    It's quite simple: The Fed's cure for a hangover is free booze for the banks (leave interest rates at zero) and to blow even bigger bubbles than ever before.

  • http://iberianviews.blogspot.com/ catracho

    all well and good.if you believe that the BIGGER picture can be manipulated..in the end, real people need to get jobs, spend money on goods, at the moment “they” are trying all out to “paint a purdy picture”, but so far that is all it is…

    I still believe that the solution to the problem can't be creating the same conditions that caused the problem in the first place…
    what kind of buns do you like?!

  • http://epiccallonfate.blogspot.com/ Dr Livesey

    also added some profile analysis on ES mini http://epiccallonfate.blogspot.com/2009/11/es-p… which confirms the up-trend day

  • http://trading-to-win.blogspot.com/ DavidDT

    “On virtually every blog, everyone is looking up, up and away”
    Please, exclude me from that summation

  • Nightwind

    Zimbabwe, Argentina, and the Weimer Republic used the Bernanke model too.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    glad to see your stainless steel fowlness is still in tip top chicken shape

    any comments on this point?

  • RacerXX

    your comments are purely Golden

  • centerline

    Heard it going home on talk radio called the “asset bubble.” An asset recovery instead of a Main Street recovery that maybe bought some time, but will end badly from here if not put into check somehow. How? I don't have a clue and I don't the fed does either.

  • http://centrifugaldeforest.blogspot.com/ Centrifugal_Deforest

    Don't be offended. I just need to be sure people know they are on their own.
    You played it very well.
    …looking to reduce it myself, on an up open tomorrow; otherwise at some point during the day, hopefully north of 14

  • marcopolo101520

    molita, molita
    pure evil.

  • amokta

    We bears will have something to tell our grandchildren – how we idled away on the sidelines, while the greatest bull run in history took place, and missed out on making x10 profit (and thats without using leverage!). We must be philosophical, of course, and come to terms with this – maybe we can still make 10% profit each year by carefully picking stocks with due diligence, and watch them increase slowly.

  • kryxtal

    lol @ pedo bear. Nice touch.

  • http://oahutrading.blogspot.com/ steveo77

    Great charts, they prove a valuable point. One thought though….going short call is selling calls. When selling calls, unless you have a mitigating risk factor, you have unlimited risk. Say you wake up and find out that Buffet is buying CAT….and suddenly your entire account is worth are $.12. That can happen.

    A big part of those moves is attributable to VIX, which plummeted in the last 10 days. So those movements are not “normal”…..just saying. I didn't sell a single option until I had about 7000 hours experience in the market.

    http://screencast.com/t/NmIzNmRkNTkt

  • randomwalker

    The quickest way to answer is to tell you to get Prechters' CTC and look at page 36 where he has kindly interposed the the 1921-29 over the 1974-00 bull market. The two graphs adjusted for time and range scales are virtually IDENTICAL. Prechter predicted the parallel in 78.
    As he states “This form is an expression of how psychology progresses in Cycle degree fifth waves that contain extended fifth sub-waves, apparently an ideal setting for an investment mania”.

    Ill take EW. Save your buns for emergency rations.

  • centerline

    My thoughts exactly for some time now. We are in uncharted territory. That is what keeps me up at night here. This is exactly why so many of us could have things all wrong in the near-term to mid-term timeframes IMO.

    To play devil's advocate, I don't see any real good way out of this mess without actually recognizing debt in some fruitful manner. Until then, this is nothing more than transfer of wealth (what remains) to the banks to bolster balance sheets against now invisible losses that somehow ultimately need to be dealt with. I don't see this as anything more than the obvious theft it is. The justification is “too big to fail.” The mechanisms are a sky-high deficit and a nuclear powered printing press. The primary side effect here is an “asset bubble.” On the more sinister side, the “asset bubble” could also be a hidden mechanism – a la South Sea Bubble. Scary.

    In the mid to longer term, the Fed is between a rock and a hard place. Can't keep printing money. Can't endlessly devalue the dollar. Can't run the deficit much higher. Also can't raise rates since deflation is still not in check. Room to navigate is running out. Time is running out too (i.e. numerous states are on verge of going under like Cali.). Around the corner instead of economic recovery are higher taxes, energy costs, etc. (already started in earnest), which will go over like a fart in church in face of a recovery for sure. A dismal holiday season could very well be the end of more retailers and others in the supply chain (more layoffs), creating the next wave of CRE defaults and bank failures, etc.

    OK. Lots of doomsday stuff. Sky is falling. No need to say that it sounds too dark. I am working my ass of to see this from another viewpoint but so far have not found a solid base to work from other than what you stated already. I am going to keep working on it and see if I can argue this from the other side as well… other than arguing the basis for the calculation of P/E ratios!

    Always great conversation Bob. Always open to thoughts, theories, etc. The more brain cells we all spend, the higher the odds we will figure out how to play this monster better. (Or maybe we will just reach some sort of multi-nodal, group stupidity, paralysis state, LOL).

  • momac

    Damn, now that is funny. I was just getting ready to take a bite of supper. I would of spit it all over the computer :-)

  • randomwalker

    I dont see CAT as a candidate for buying options on, great for writing them if you held it. It seems like a good proxy for the index, only in neutral right now.

  • centerline

    Oops. Sorry David… Glad your feeling better. Was it the flu you had last month?

  • leftbankwine

    I dont know about that, how many would have participated by buying right at the bottom, I would say not many, and how many had taken some serious hits to their portfolio given the draw down from the beginning of the year, I would think many. Now some played the momentum game with the “toxic avenger” crap that was the financials (see AIG, BAC et al), but I would say many missed most of the first part of the upswing. I think the H&S fakeout over the Summer hurt the most, but most missed this rally, I just sat through a presentation on a TA portfolio that was down 21% last year, and is up 14% this year, great numbers relatively, but given the upswing, not so great, I think prudence lends a bit of risk adjustment, and to say all bears missed out, is giving more credit than is deserved. Also, this is not over, by any means yet…

  • http://centrifugaldeforest.blogspot.com/ Centrifugal_Deforest

    Ok, I just spit out my updated position and simpleton thoughts over on the CD site (I mention it since I've re-re-shifted back to long again since doing just the opposite earlier today)

    We can't drink at the same table tonight, eh bears?

    Wish you luck all the same
    …NOT!

    blah blah …http://centrifugaldeforest.blogspot.com/

  • http://stainlesssteelchicken.blogspot.com/ StainlessSteelChicken

    Nothing profound, but I'm not watching too closely these days.

  • observingguest

    A Decision Point chart currently shows the S & P 500 p/e at $145.60. I believe the calculation is based on trailing earnings which in my mind is the correct method since no one knows what next years earnings may be. Despite the governments assertion that the economy grew in the third quarter, many observers would suggest that the economy is treading water at best. Of the variable ways that the p/e can decline, the most likely is that prices will fall while earnings are flat at best. For the S & P 500 to trade at 15 times earnings, the price would be 113. The reward of higher prices comes with enormous risk of loss currently.

  • davosdax

    Buying options has been a bad strategy for me this year. Unless when I up my risk factor, looking for a quick scalp. The longer term set pieces have just withered away on me.

  • gregn

    Yeahc I was planning on 3 day positions.

  • http://gemstowear.etsy.com Jan

    Similar to the liberation of Iraq, which did not go as planned either, the derivative ponzi schemes have gone array. I think the global financial situation is running on fumes and all of this is not going to end well. It's musical chairs without any chairs when the music stops.

    I want to know what went on behind closed doors during Obama's trip to China. I'm frightened that some of the criminal acts of JPM and GS are beginning to hit mainstream media. I'm worried about all the people I love who have no understanding about what may happen to our way of life. Sorry for ranting, but we all know how this is going to turn out.

  • Tronacate

    That's pure fantasy thinking anyone catches a whole trend. The bulls probably got their asses kicked on the crash, and have some comfort from this rally.
    The biggest problem is the hard asset destruction outside of the market.
    And the jobless receive little comfort from anything.

  • Tronacate

    War seems to be our only expertise these days. And our “success” in Iraq and Afghanistan speaks volumes. We incarcerate more people per capita than any nation in the world…..our greedy bankers screw the whole world economy…….what a legacy.

  • http://www.anomalousmaterial.com CastorTroy

    Indexes are consolidating at this point. ES 1100 is a multiday support worth watching. I don't think we go much higher if at all but technically, there is no reason whatsoever to be aggressively short at this time. Let the market come to you, they don't give medals to stock market heroes
    http://tinyurl.com/ye4fb8n

  • http://trading-to-win.blogspot.com/ DavidDT

    “I'm worried about all the people I love who have no understanding about what may happen to our way of life. “

    Don't worry be happy – you should not worry about something that already happened…

  • Tronacate

    TF futures have pulled back after the ah runup.

  • Tronacate

    Dollar 75.25

  • leftbankwine

    http://pragcap.com/must-see-steve-keen-how-do-w

    Great video from Prag Cap…

  • http://trading-to-win.blogspot.com/ DavidDT

    yup
    flu
    4 weeks out of my life and still not quote back yet
    ty for asking

  • wex

    Hey Mole,
    Get some tent canvas and turn it into pants.

  • bergs

    sorry for the delay Nightwind, I just now got back on line.

    Possibility is there. the MM have gotten pretty good on disquising waves.
    I assume you are thinking a B wave of a large ABC for a fourth wave?
    If so we will have five waves down for C. I would assume a prudent bear investor would then go long for the ride up in a wave two or five as you see it. So no harm no foul. the agony will be after three waves up do you go long or short?

  • http://gemstowear.etsy.com Jan

    Baltic Dry Index hit the 2009 high today. Dry shippers have been rising big time for the last few days. Take a look at EXM,EGLE, GNK, DSX and PRGN.

    China has been spending boo-koo US$ on importing commodities during 2009. Am I grasping at straws here in trying to figure out why Obama went to China? Any thoughts?

    http://tinyurl.com/yblhf56

  • blues

    Well DXY10 day chart look like a sideway consolidation… we really need it to get above 76 to have a good breakout to the upside… anything below, just nothing… the thing that bug me the most is that the market as been very strong even in the face of DXY bounce… DXY closed Nov 6th gap twice and yet SPY didn't even budge… We couldn't even close this monday gap, not even a gap test…

  • Schwerepunkt

    Shippers are a great short when the market turns. Most of them suspended their dividends to save capital and are heavily indebted and loaded down with depreciating assets (ships). There are simply too many ships for the amount of trade going on even now, let alone another crisis in confidence. Too many new builds and not enough being sold for scrap.

    If we get a double dip recession/credit crunch II, a number of names in this sector will not survive, although a fair amount of financial re-engineering has already been accomplished by the more astute management teams.

  • Eva S

    The shipping stocks have had a huge run up the past 2 weeks & are ready for a pullback.

  • BigHouse(Aka Mr Vix)

    http://www.cnbc.com/id/15840232?video=133528815

    I really hate CNBC but at least there was something positive. Charlie Gasparino saying CEO of GS should step down…..

  • blues

    CEO should step down? I think GS should be dismantled PERIOD!

  • BigHouse(Aka Mr Vix)

    They should close the place down and turn it into a factory…. This should be the new location of http://www.buildabear.com/

  • molecool

    I'm on it.

  • molecool

    I take that as a compliment.

  • molecool

    Favorite comment of the day.

  • molecool

    You're shitting me – was it H1N1?

  • davosdax

    His book isn't doing as well as Andrew Ross Sorkin's. So he's just trying to drum up some publicity. Blankfein and Gasparino are two peas in a pod.

  • BigHouse(Aka Mr Vix)

    Indeed…..I know how the system works. I know longer work on Wall Street. But i will say this…Bob McCann got me my first job there with one phone call…back in 1991. Folks can google his name if you are clueless about him….

  • vision_invisible

    “FedWOW – Holds 2x GDP in Liquidity” – a great laugh from Zerohedge

    http://www.zerohedge.com/sites/default/files/im

  • de3600

    You know I was justing sitting here tonight reading about the GS bullshit record profits on and on. I got a phone call tonight and found out that 3 children are sitting at home with no heat and the power was shut off in their house. I live on Long Island and it is pretty cold out tonight. On top of that I asked what about the holiday and find out they cant celebrate it.Now to me that just breaks my heart no child should have to go thru this. So I am gonna see what we can do tommorrow to see if we can get power and oild back in the house and see if they want to come to my house for the holiday. I will prob pull money out out my trading account to get this stuff back on. The said part is this is happening all of over this country and these fuckin idiots in Washington just dont get it. To see this fuckin idiot come out and make comments “We are doing God's work ” it digusting and this prick should be hung from the closest tree.This family is not one of those I need everything to be frank they have always had very little. Anyway I thought I would post it just made me very sad indside to think about alot of childern that are suffering like this

  • vision_invisible

    absolutely do something. generosity that costs you something you value (real time/real money) is the most sincere kind. good luck to them.

  • http://www.evilspeculator.com berkshire

    I see it as a 4th wave triangle in which we completed D at today's highs, needing an a-b-c down in E before one final fucking push up, likely Monday at this point.

    Skål!

  • LogansRun

    Yes, this is exactly the dilemma indeed.

  • gregn

    “Nobody comes here anymore… it's too crowded.” ~Yogi Berra

  • tradejane

    Thank you. Who know, maybe one day a trade like this will be the rule instead of the exception. 😀 I´m still working on my “nerves of steel” theme… which you have plenty!

    GL may it go to 20.

  • tradejane

    That's really cool of you to do this. I believe if there's anyway we can give back to this world, we should. Just be careful what you give. Whenever I give away clothes or books, for example, I end up getting back 3 times that much. :)

    The media enjoyed accusing the shorts “of bringing the market down” last year. Ha. I think we are performing a public service!

    http://www.businessweek.com/magazine/content/07

  • bobthehorse

    Gold is in a primary degree 5th wave in my view. If you look at the chart of Gold as a % of Money Supply, it is a very clear 5th on a long time-frame. So it could go anywhere – I would not buy it but would not short it either. One day it will be down $100 overnight but it's not possible to say from where. It will get crushed if deflation woes come back as it has no yield.

    This has been one of the most boring weeks of my life – I have literally not changed a single position. The only good thing is, I predicted it. The most likely scenario is we are simply consolidating a bull market and we will have to buy it next month but there is a small risk of a big move lower.

    I actually think the odds of that move lower have gone up recently. There are two things which can take the market down – inflation or deflation. I don't see inflation risk until early next year. Deflation on the other hand is more interesting. Deflation risk has been entirely priced out by the mkt. Yet, a number of asset classes are saying it is on the way back. Look at 10yr TIPS yields, look at Japanese Banks. These could be canaries in the coalmine.

    I don't expect a fall before expiry but price action thereafter could be very interesting.

  • CorporalCarrot

    Christ, when you are down, nothing goes your way. Ireland is a pretty depressing place at the moment, and we really needed something to lift us. To say our players did us proud last night, would be an understatement. They won against the odds (7-1 on betfair), played a blinder and in the end were ROBBED BY A GYPSY CHEATING FRENCH BASTARD. FUCKING DISGRACE.

    http://www.youtube.com/watch?v=a_rcSgU9GKo

    TO hear him this morning claiming in the interviews that the ball merely bounced up and hit his hand the guy is doing himself a disservice and confirming him as the cheating fuck that he is.

    As Abe Lincoln I think said, sometimes its better to remain silent and be thought a fool, than open your mouth and remove all doubt.

    Anyway, congrats to Gsavli and Stainless Steel Hamster (our resident Slovenians I think!!), great result against Russia.

    What up with Uncle Buck this morning Bob? Is simply refuses to die, when it really should have been pushing up daisies at this point. No sellers left?

  • jacksoo

    Feel for you CC – no excuses in this day and age – -makes the game look bloody stupid – blatant and acknowledged cheating is just brushed aside. I no soccer followers mock the NFL but at least it does everything it can to prevent this type of injustice.

  • tradejane

    Yesterday the DAX attempted to return to its October 20th high. The banks, as noted, were not very cooperating. It sold off at the 5840 area.

    Today it opened below its pivot of 5.800 and while it could still stage a good run from here, the bank action is making this possibility increasingly unlikely. First support is 5757 – first resistance is 5830 area.

    Infineon beat expectations – as expected. In the spirit of trying something different, I indulged in some Dec puts and I also picked up a few DAX Jan puts.

    While I agree that the market is likely to hold this week, I just can't see a continuation without the banks…

  • bobthehorse

    I listened to it on the radio – was totally outrageous. There should be a one-off match played at Wembley next week if there is any justice in the world. Henry should be banned from the World Cup. I hope he suffers for the rest of this life from that. As an Englishman, the parallel from Maradona in 86 is very real.

    The dollar is going up – simple fact. What are the US doing that no one else is? Nothing – everyone is doing QE, everyone wants to devalue the currency. The US have done it first so they will benefit first, the relative growth prospects of the US vs. Europe and the UK are much better and the $ will begin to reflect this soon enough.

  • Niktus

    Incredible :-/

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    thanks CC, but WAY OFF, we beat Bosnia

    yes, the sshamster is portuguese

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    if you use quotes use them correctly “goes there”

    he ain't said all the things he said

    LOL

    p.s. I should be flogged for having started the yogi berra quotes but

    “If you can't imitate him, don't copy him.”

  • http://iberianviews.blogspot.com/ catracho

    yes deflation is the minority view right now it seems….say no more!

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    OPEX week comment

    “90% of the putts that are short don't go in.”

    yogi berra

  • CorporalCarrot

    Ok someone yesterday asked me to wish you luck against the russians so not my fault!!!!

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    oops didn't see it, but thanks

    BTW back in 2000 (i think) the referee also scr&wd portugal against france

  • kanur

    As my ol pa always says, it ain't the puttee son it's the putter!

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    but… an irish won the national book award Colum McCann

  • CorporalCarrot

    Yeah but you don't go down to the pub to drink Pints of Guinness and watch the book awards 😉

  • jacksoo

    you snatched a last minute draw against the Wallabies – not all bad.

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    well, now the irish will support every team that plays against the french (and those that play against england as well?)

  • CorporalCarrot

    You better believe it!!!!

  • gsavli

    Sorry to see that, CC and thanx for congrats. Nothing a radical binge can't cure, eh? I cannot say, how much I was pleased, after you finished regular time with 1:0 at Saint Denis (did I mentioned, we lost once there by 5:0, lol). I saw a lot of compaints about “those cheating bastards”, unfortunately your video on youtube is no longer available.

    Anyway, congrats to our team, which literally blew away Russia yesterday (score doesn't show it, but Russians where non-existent on the field for first 70 minutes) and of course, to yours, SSH. See you in South Africa.

  • CorporalCarrot

    Well I'm sure its elsewhere on youtube. It was the most blatant case of cheating. Henry claims the ball bounced and hit his arm……on the tv you can see clearly he actually sticks his hand out to control the ball, not once, but TWICE!!!, then crosses for Gallas to head into an empty net.

    Congrats to you guys anyway.

  • http://www.flickr.com/photos/dabasia/sets/ Croozer

    Anyone know why ES is falling?…..only thing I can see if sharp USD moves…..

  • http://sshamster.blogspot.com/ Stainless_Steel_Hamster

    and may the best team win (as long as it's not the french, according to CC)

  • CorporalCarrot

    Dollar strength plus the fact that after a run-up where we have been up 10 out of 12 sessions or something like that you expect some selling at some point, even if the overall trend is still up.

    That being said, if this particular fractal has topped in the S&P it is clearly weaker relative to the Dow, so it will be interesting to see what happens if we gap down below 1102 on the cash.

    Also, there might be some nervousness in advance of payrolls at 8.30 and the LEI at 10.00am.

    Thursday's economic calendar:
    8:30 Initial Jobless Claims
    9:00 Conference: Restoring Global Financial Stability
    10:00 Leading Indicators
    10:00 Philly Fed Business Outlook
    10:00 CRE Leading Indicator
    10:00 Hearing: Financial Regulatory Reform
    10:00 Markup: Restoring American Financial Stability Act
    10:30 EIA Natural Gas Inventory
    4:30 PM Money Supply

  • gsavli

    Uf, saw it now. Ireland team actually stopped playing there, since it was so obvious it was played with hand. Really, this match should've been played again. For the sake of soccer, you just cannot allow this match to be regular and score to stay there.

  • http://iberianviews.blogspot.com/ catracho

    Possible early warning sign? We still need o break that trend line though
    http://3.bp.blogspot.com/_9titM9yn4xw/SwU2UQHat

  • amokta

    is it normal for the Btir Pound to lose 2 cents to the dollar in 2 days?

  • amokta

    Are you Germanian? Thanks for the daily update on the largest economy in Europe!

  • tradejane

    Aussie Dollar likes gold, doesn't it?

    For what its worth my tea-leaves report that GDX may have topped yesterday. Probably around the same time that Mole called for a drop in Gold. Wouldn't that be an amazing coincidence if it pans out?

  • mrrockpower

    It could well be that the increased popularity of the gold is reflecting a distrust in governments. The increase in price is mostly connected to a declining USD. The gold price has not increased to the US levels elsewhere. I agree with the point that if the USD corrects upwards, everything else should decline.

  • http://iberianviews.blogspot.com/ catracho

    yep..

  • gmak

    * Ahem *

    There is a new post.

  • bobthehorse

    Mole – did you know Evil Speculator is an anagram of Virtue Collapse?

  • tradejane

    LOL.

    Thanks for the kind words. If you like this you'd love gmak's reports.

  • Me_XMan

    Watch dipsters closing the down gap this morning.

  • rangefinder

    Cute one's of course!!

  • rangefinder

    Random – I gotta say that I think Pecker erm…., oh! Prechter is not the powerful force of influence he once was. He's been calling this rally over for some time now and like every other EW counter with a corrective count he's had to first revise and then abandon his counts to find something, anything that fits. Well in my book if the count don't fit its wrong and that alone should be a big indicator that this is a market which is NOT corrective. I don't claim to be an EWT expert but I can still construct a viable bullish count. However, having watched this EWT at work over the last 9 months (which is how long I've been watching this market intently) then IN MY OPINION (in caps so that you can see that this is my opinion as opposed to an onion) I have to say that I think most of it is smoke and mirrors. Its useful at the minute/minuette scale but intermediate and higher degree are more clearly signalled with EMAs as these are trends and (onion) only loonies snipe in the sub-minuette range.

    This market will turn but it will not collapse in a P3 avalanche – this market will impulse higher and bull along until QE is stopped and taxes are upped to try and tackle this deficit. At that point, which could be a year or more away, then we have a chance of the market going lower but until then IMO it's going up.

  • http://thetaildoesnotwagthedog.blogspot.com/ dnarby

    I'm with mole on this one.

    IMO all asset classes sell off with the next round of selling. That should scare the sh!it out of people, and get them back into bonds.

    GLD down premarket with everything else. Guess I'll get a chance to see if I'm right soon enough.

  • randomwalker

    Yeah shippers may pullback a bit then run some more..tho some are up almost 3% in AH.. BDI might be in a parabolic rise..

  • randomwalker

    Sorry were up last night

  • randomwalker

    Rangefinder – thanks for your reply. I agree with you regarding the futility of squiggly-divining the TACTICAL direction of any market or security using waves. Its useful pretty much only on a STRATEGIC scale. And sometimes it doesnt seem applicable to a certain market.

    The belief in the power of governments and the Fed is erroneous Prechter points out again and again.
    The government cannot efficiently allocate resources or create economic gain.

    Thats why believing in emerging market growth to pull the world out of recession is dangerous, Imv.
    Do you trust in the Great Leap Forward of China which is largely capex driven to continue indefinitely?
    The point Prechter makes is that growth in any economy is ruled by the law of dimishing returns – a capex boom lasting 12 years is unprecedented in world history, and by natural rules increasingly inefficient.

    The smoke and mirrors Imv., are being perpetrated by the Central Banks and politicos. Given that they are committed to protecting the 'economic recovery' there could be many false breakdowns. Think of it like 2006-2007 when the sub-prime and credit booms were nearing their end. When its a 'trust me' story you should be ready for the sudden 'crack-up'! Timing? Sometime in H1 2010. JMHO.

  • rangefinder

    Random – thanks for your feedback.

  • GreenPlay

    Mole is my new hero.

    I've been friending this trend and trading only one instrument in my spec account for the past month. Noob that I am, I am finally getting a little better at this. May a lucky call at 1227. Today, 6 December (or tomorrow, 7 December, or the next day), may live in infamy for gold-bugs but Tora Tora Tora is fair in gold-love and gold-war, Me? BTDT. Heck, way back in 1919 Dos Passos got it right: “Wars and panics on the stock exchange, machine gun fire and arson, bankruptcies, warloans, starvation, lice, cholera and typhus: good growing weather for the House of Morgan.”

    Good growing weather for any real trader: the kind that don't need no stinkin badges. Even for the modest House of GreenPlay.

    If I may feel more heat than my stake can stand I'll watch the action from the sidelines, but you gotta test for the bottom every so often, and I've got my triggers set.. I'm gonna see if I can't catch a spike when trading opens on Sunday. I think it's up crazy, then down. I'll be in and out quick, or if a trend forms, maybe for half a day. Easy to get out and sell into strength; you can always get back in. Or do the old Turtle long-term trend-following play if you have a big enough stake and even bigger cojones. Either way, tight stops!

    My pal and indefatigable research assistant Carl offers this: Reminds me of when Goldman raised their estimate that oil would hit $250, right before the collapse began. If the economy improves, and inflation is mild or even non existent, with an improving dollar, the gold bugs will have trouble finding people to buy it. Gold has been driven up by a small group of heavy hitters who believe in the declining dollar higher priced gold scenario. I still believe that we still face at least 2 years of mild inflation, even possible deflation if the economic recovery does not have legs. In this scenario—those who have been falling all over themselves buying as much as gold as possible, will be caught wanting dollars, when they walk into any store. Carl

    So I'm ready for a fun week with GC futures – big greedy pops and sudden panicked lemming leaps. There is no such thing as smart money. I think there's only big money, and sometimes it ain't smart, just big. The guys with the most chips always have the edge. Anybody who knows Texas hold'em knows that. But with a little luck and a lot of study, and most importantly the right mindset, the unlikely small-fry can game their game. Hey, they aren't the only guys with computers! When it's your own money, you tend to stay up to – what time is it? 3am? So, deal em, and let's all play our own game. Unidentified blips on the radar, sir! Mixed metaphors, son. Pay no mind. Get some sleep.

  • http://clark-works.blogspot.com/ GreenPlay

    Mole is my new hero.

    I've been friending this trend and trading only one instrument in my spec account for the past month. Noob that I am, I am finally getting a little better at this. May a lucky call at 1227. Today, 6 December (or tomorrow, 7 December, or the next day), may live in infamy for gold-bugs but Tora Tora Tora is fair in gold-love and gold-war, Me? BTDT. Heck, way back in 1919 Dos Passos got it right: “Wars and panics on the stock exchange, machine gun fire and arson, bankruptcies, warloans, starvation, lice, cholera and typhus: good growing weather for the House of Morgan.”

    Good growing weather for any real trader: the kind that don't need no stinkin badges. Even for the modest House of GreenPlay.

    If I may feel more heat than my stake can stand I'll watch the action from the sidelines, but you gotta test for the bottom every so often, and I've got my triggers set.. I'm gonna see if I can't catch a spike when trading opens on Sunday. I think it's up crazy, then down. I'll be in and out quick, or if a trend forms, maybe for half a day. Easy to get out and sell into strength; you can always get back in. Or do the old Turtle long-term trend-following play if you have a big enough stake and even bigger cojones. Either way, tight stops!

    My pal and indefatigable research assistant Carl offers this: Reminds me of when Goldman raised their estimate that oil would hit $250, right before the collapse began. If the economy improves, and inflation is mild or even non existent, with an improving dollar, the gold bugs will have trouble finding people to buy it. Gold has been driven up by a small group of heavy hitters who believe in the declining dollar higher priced gold scenario. I still believe that we still face at least 2 years of mild inflation, even possible deflation if the economic recovery does not have legs. In this scenario—those who have been falling all over themselves buying as much as gold as possible, will be caught wanting dollars, when they walk into any store. Carl

    So I'm ready for a fun week with GC futures – big greedy pops and sudden panicked lemming leaps. There is no such thing as smart money. I think there's only big money, and sometimes it ain't smart, just big. The guys with the most chips always have the edge. Anybody who knows Texas hold'em knows that. But with a little luck and a lot of study, and most importantly the right mindset, the unlikely small-fry can game their game. Hey, they aren't the only guys with computers! When it's your own money, you tend to stay up to – what time is it? 3am? So, deal em, and let's all play our own game. Unidentified blips on the radar, sir! Mixed metaphors, son. Pay no mind. Get some sleep.