Crash Market Stocks - Financial Tips On Making Money In The Stock Market

It looks like reality is beginning to settle in for traders around the world as we continue to be caught up in a whirl wind of havoc and bad news. Today we saw that the market has little patience or mercy for the doubts and fears going on in the world. Wow, there's a lot to talk about today...

Today is the first time the Dow has closed under 8000 in 5 years. It dipped below 8000 last month but came back above before the end of the day. Another historical number we saw today was our CPI numbers. We fell 1% for the month of October, which was far greater than expectations and is the single biggest monthly loss in CPI since the index began tracking in 1947. Housing starts fell 4.5%, which was near market expectation (but still depressing). Coupled with that we had a slew of bad earnings report from retailers as well as the auto bailout fiasco which still continues. Overall, it was a bad day for your average stock trader.

These are the things we have been discussing for a month now. No matter what new bailout news we receive, or little light given by government regulators, nature will take its course. And until the government allows it, unfortunately, I believe we will be in this continual roller coaster that can give traders a splitting headache. Not to say that I am a pessimist and wish the economy to crumble. I just saw the signs a while back and know that's what needs to happen in order to get things back on track, so why not make some money on the way, right?

So lets talk auto bailout. I still believe a lack of intervention from the government and the auto companies going under could be the shove the market needs to capitulate, especially now. I don't know if the government is ready to deal with that. I think we will see some agreement happen, even though I disagree with it. But until it does, it leaves uncertainty, which the market hates. Uncertainty and fear are key signs to capitulation.

So what else led to the downfall today? The FOMC minutes were released today from their prior meeting from a few weeks ago. In it they discussed of the probability of negative GDP growth for the next 4 quarters. Even though many of us have already expected at least that, to hear it come out of "The Fed's" mouth causes even more concern. Their suppose to be our super heroes right? You can see their minutes here.

In the midst of all this turmoil, I am still a believer of the good possibility of a rather strong rally in this bear market. In fact, call me crazy, but I picked up some UYG options (.UUFLF), considering UYG was down over 20% today. Financials have taken the worst beating of them all, and probably will continue to, but I just felt like it was low enough to give me some good profits for the next rally. These are those "defining days" I talk about that I like to wait for to buy. That was my only move today. Our "Rock Stars" looked great today. SRS and SKF were both were over $220, impressive. EEV is up to $110, and FXP is closing in on $88 (All were up anywhere from 15-25%).

My long options were down today, but not by much, surprisingly. GDX and Apple are weathering through the storm pretty well. DIG was hit hard do to demand uncertainty. Gold futures were up today and it's only a matter of time when oil is creaching back towards $90. When the next rally comes, they should perform pretty well. Plus, my positions in these are significantly lower than my short positions.

Tomorrow is a critical day. We have seen a lot of resistance at around 7800. If we punch through that bottom tomorrow, watch out. However, being in this fragile state, with a bailout announcement or some positive news, we could see a pretty strong bear market rally. It will take something pretty significant though, I would think. Which ever way we turn, expect some serious volatility and strong moves in whatever direction we're headed. Remember, this is options week, which usually entails some manipulation, so we could see some interesting moves before Friday. Either way, I believe FXP should be at $100 shortly, as China is sure to be dragged down with us in our bad news. If we do indeed rally strong Thursday or Friday, I will look to get out of most of my options and putting them right into EEV.

I hope everyone survived today and that your bleeding green. No one can be 100% right in this market. If you are, give me your contact information. Thanks for the insights with your comments. Happy Trading and have a good night.