Keep Your Cool

I do see a lot of anger in the comment section tonight. Looks like Nouriel Roubini’s comments were taken out of context (or misrepresented – I still need to come up to speed on this) on CNBC, thus potentially providing a catalyst to the final leg up in today’s edition of the OPX week bear squeeze.

Ladies and leeches – I am going to be very straight forward with you: You need to let this go. Stop this whining and bitching right now and put this trading session behind you. It’s done – they won – we lost (well some of us – a few folks here were long). Unless the populace revolts and sweeping changes are forced onto the financial system as we know it these kind of games are going to continue in perpetuity. You cannot let this affect you or your trading. I know it’s not fair but guess what – life is not fair and the minute you decided to trade the markets any expectations of fairness should have been abandoned. That’s all I have to say about this and I expect you guys to act like professionals and move on. Man up!

This is actually a lot more important. I just pulled down the latest batch of the Moody’s BAA feed I’m able to get (manually) from the St. Louis Fed site. Unfortunately it’s the only feed I know of and it’s not only cumbersome, but it’s also a week behind, which frankly kills me. Why you ask? Because it’s quite apparent that during the entire drop to the downside from the 960 peak the TYX-BAA spread had not budged and kept going sideways. Which would have been a very strong indictator that Soylent Green was not an option and that Soylent Blue was in danger as well. Of course I didn’t know until today as pulling the data from the site and adding it to my handrolled Excel sheet takes at least 30 minutes (and I already work 14 hour days 6 days a week).

So, I need a daily Moody’s BAA yield feed – desperately. I know that Bloomberg has it but I don’t have a Bloomberg terminal. I have access to various data sources, among which DTN is one of the better ones – but they don’t carry it either. If any of you have access to a non-delayed BAA yield feed please let me know – you can reach me at admin at evilspeculator dot com.

Many of you might be tempted to think that they possibly couldn’t bang this tape any higher. If you do – you are dead wrong. They can and they will unless some big bad bears show up – and thus far the bears turned out to be little cups or they are back in hibernation. So prepare yourself for – yes – yet another bear squeeze which will probably take out the last few remaining hobby bears. I have marked 952 on the chart which is what I see as a potential target for tomorrow. I believe that Monday we might see a pullback – but at this point it appears to me that this third wave is extending and it’s tough to predict where it’ll end.

So, if we get a little pullback in the morning watch the tape with eagle eyes and be ready to hedge yourself – assuming of couse you are still short this crazy bitch.

Also, please note that the target for the pullback target of 912 is incorrect on the chart above – my max target at this point is 922. Sorry – it’s getting late and I don’t feel like redrawing this.

The Dollar closed below 80 today, which supports the notion that we’ll see a fifth and final leg to the downside – my preliminary target thus far is the 76 region as there is a bit of resistance below that. Remember that a dropping Dollar will favor rising equities – they really pulled a fast one on us bears by not letting that thing out of the box for two weeks. Maybe I should have been more suspicious on Tuesday night – again, my only consolation at this point is that I kept you guys from selling that fake neckline breach. So, we got out of this with a black eye and some bruised ribs but let’s remain on guard now and play it small until the end of summer. Capitial preservation will be the name of the game going forward – I might participate in some longs but take profits quickly.

Bonus Karl tonight 🙂

Cheers,

Mole