Why This Is Not A New Bull Market

UPDATE 12:25pm EDT: I guess you rats had Soilent Orange for breakfast. Boy, am I glad I took profits on my SPY puts at 865 yesterday. Sorry, don’t mean to rub it in – but some people accused me of not being explicit with my trading activities. Go back and correlate my announcements of both the entry and the exit with yesterday’s ticker. Moving on…

Okay, here’s exhibit A of why we are in a bear market rally – and not in a bull market. As I keep drilling into your tiny little rat skulls:

Bear market rallies continue on bad news and reverse on good news.

Frankly, this is as bad as it gets and anyone with an IQ larger than their shoe size should at least be worried about the economic impact this will have on the U.S. auto industry over the near and long term future. In particular with cars being one of the last few remaining products we actually build in this country. From Chrysler’s history page:

The Chrysler Corporation was founded on June 6th, 1925 by Walter P. Chrysler. The company originates from the Maxwell Motor Company, which Walter P. Chrysler had joined in the early 1920s.

This company has been mainstay of the U.S. auto industry for over 80 years – and the larger public has become so complacent and Prozac induced that the news of its demise causes a jump in the market? Boy, we are really not in Kansas anymore, that’s for sure. Talking about short term thinking taken to the max….

So, let’s see what happened in the stock market the day after this little news tidbid was released?

That’s right – another upside gap at the open and an ensuing rally to 889 – the tape sliced through the 881 resistance line like a hot knife through butter. Only five years ago a headline of this magnitude would have crashed the stock market or at least been good for a 600 point down day in the DJI.

Here’s something else you can carve into your cerebral cortex: As long as you keep seeing the words ‘investors shrugged off….’ in the news the bear market is not over. It’s just taking a little nap.

Soilent Orange might continue and push us to the 900 line today – nothing holding us below that right now except for market maker madness (i.e. generation of buys/sells by whipping the tape around a bit).

Soilent Blue is way overdue (hey that ryhmes) and either will get u to 871 or 860. Frankly, I have doubts about the latter as the bears at this point are cowering in their lairs in a fetal position after continuously having taken it up the rear for the past two months.

Gold continues to be a tease and although my GLD puts love yet another drop in the spot price we need to see some movement here. Had it been up today I would have cut it without a thought – let’s give it another day and see what happens – but time is running out.

Finally, I do have a bone to pick with you rats. I’m looking at the current poll and am extremely unhappy about what I’m seeing. First, it seems that lobotomies have enjoyed an unexpected revivial – which might account for some of the comments I keep seeing lately. But what really gets me is the lack of participation.

Nobody seems to give a shit. And I know why – because evil.rat/NQ had two whipsaw days in the last week or so. In this crazy tape. After it has continously performed for two years. With minor draw downs. While all other momentum indicators (except for the Zero) have completely broken down.

Give me a break people – I know what’s going on in your little rat brains and I’m not even going to waste my time rehashing all the points I already made about black box trading. If you are a subscriber I strongly encourage you to go to the evil.rat tutorial and read it again. Please don’t email me with questions – just read it and then think about it for a day or two.

As per resident.evil: I’m not sure I feel like introducing it at this point. If there is such little interest – even though I offered it for free for three months to all existing evil.rat subscribers – then it’s probably best to refine it and then offer it as a subscription to the few who actually see value. As the old saying goes: You offer something for free people don’t see any value in it – the human mind has a range of factory equipped falacies I probably will never get used to.

I’m not amused.