Showing posts with label have we reached the bottom. Show all posts
Showing posts with label have we reached the bottom. Show all posts

No Santa For Stocks - Season's Beatings

I hope everyone had a good weekend and was able to knock off some holiday shopping. I don't know about you, but I couldn't help but notice the extremely low traffic at my malls, given it being just a few days before Christmas. Sure, there were a lot of people there, but nothing like years past. I guess it is just another sign of people not spending. There is a lot more of that to come in 2009.

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Today, resulted in an interesting low volume day. No doubt, the holiday vacationers led to the low volume in today's trading. However, the sellers were definitely still by their computers, wherever they were. The market started out with a doozy of very disappointing earnings from both Walgreens, the largest US drug chain, and Toyota. If autos needed even more pessimism. Even the best made, most attractive and definitely most dominate auto company is having severe sales problems. I don't see a very bright future for our US autos no matter what kind of loan they get. Not for at least 2 years.

Another element, which made people a little ornery today, was the study that came out showing where banks have used the issued "tarp money." The results found that many of the banks were still paying out very large salaries to their executives as they did not have an outlined executive payout like the autos do. And as you can tell, not a lot of new "tarp" lending has hit the consumer market. So these funds are getting soaked up one way or another.

Something very interesting caught my eye today during today's trading. Notice below, the huge upswing just before close. Something came into the market during last 10 minutes to help give it a big boost (my guess starts with an F and rhymes with Red). With the low volume of trading and the large amount of bad earnings, I can't see a natural upswing like the one we saw today happening on its own. Can you say manipulation?


All the shorts finished strong, especially FXP and EEV. As we have discussed in other posts, foreign turmoil is building up and the more unstable the US becomes the more it reflects on these emerging markets. I am feeling good about being in them. SRS was up strong and came down towards the end with the market moving. One big reason for the fall as well, is that commercial developers are requesting to be a part of the bailout list, asking for more than 200 billion dollars. That's awesome, we're not even to Obama yet, and they are already asking. Of course, no companies were singled out personally, as their stock would most likely tank, but you can probably guess (Simon, Kimco, GGP, Centro), but their stock did receive some love today, as it seems some people believe they may get help. I cannot see them getting bailed out at all and them even asking shows just how much pain there expecting. You open Pandora's box if you give developers taxpayer's dollars. I am loving SRS next year.

Expect the volume to continue low this week with it being Christmas week. I still think selling will remain most the week as sentiment is getting worse everyday. The market has seemed very bearish the past two trading days, and once the volume comes back, it could get ugly. There should be some great profits made here in the near future. I hope everyone has a good evening, Happy Trading and see you tomorrow.

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Friday Rallies Persist - Madoff's Ponzi Scheme Could Cause Problems


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What a day. I felt like I was riding a never ending roller coaster. Investors had no idea how to "day-trade" in today's market as digestion of all the new economic and auto bailout news was a bit difficult. Then to top off the day, we have the Madoff hedge fund scam that should cause some noise next week.

As expected, pre-market trading was very negative, in response to the rejection of the auto bailout last night with The Senate as well as the Madoff scheme. The Dow dipped as low as 220 points today, but quickly gained strength as President Bush announced the possibility of utilizing a portion of the "Tarp Money" to assist in preserving the autos. As I discussed yesterday, I did not see a very likely chance that they would completely abandon the auto makers.

We then received the retail report, which once again brought down the market. Retail sales came in down 1.8%, which actually was lower than market expectations, but it also has been the longest stretch of negative sales (beginning in July) since the Commerce Department began tracking the number in 1992. Many people believe the reason for this semi-optimistic number, is that more people did ALL of their holiday shopping during the Black Friday weekend, instead of spreading it out over December, as it has been in prior years. I don't know about you, but lately, the traffic in the shopping malls near me have been pretty modest.

Another positive that bumped the market a bit, was University of Michigan's consumer sentiment report came back more positive than the previous month, rising to 59.1 from 55.3. Much of this was contributed to the incredible drop in gas prices, as most people are getting anywhere from $50-200 extra a month now. However, studies show that people are not spending this money (either being saved, or paying bills). So in turn, that doesn't do much for our monetary supply chain. At any rate, they don't call the end of the year "The Bull Season" for nothing. People are a bit more positive during this season.

In the end, we did see the "end of the week rally" prevail as I believe that makes it 8 weeks in a row we have seen a rally on a Friday. I am still hearing from analysts on the news that, because of the ability to stay positive in the midst of persisting negative news, that means we're at the bottom. Hilarious. We are ankle deep in this current economic crisis, that has a very long winter ahead of it. And what happened today with the Ponzi scheme is a preview of what we can expect in coming months.

Today, Bernard Madoff, the well respected Wall Street guru who managed a billion dollar fund, and who was the Chairman of the Nasdaq Stock Market in the 90's, was arrested due to frauding investors of what could be more than $50 billion in what authorities are calling a "ponzi scheme." Madoff was able to fool investors into thinking their fund was producing great returns, when in fact their money was being sent to what Madoff called, "money heaven." This gives more weight to the phrase, "if it seems to good to be true, it probably is." Even though, the market seemed to plow right through this, this is a big divot in our recovery. This directly affects investor sentiment. After this story being in the headlines all weekend, many investors will question their hedge fund's integrity. If it wasn't difficult enough for hedge funds to gain confidence from investors to keep their money with them, now they have one more big obstacle they need to clear. Having been looked right over today in the "Friday Rally", I believe we will see this scheme factored in next week, as people will realize how big of a deal this really is.

We've got a lot of action in next week's trading. Not only do we have the Fed's meeting to discuss another rate cut, we also have Morgan Stanley's and Goldman Sach's earning announcement which should cause some momentum (either bad or good) for financials. I plan on selling my UYG options before than, as I do not expect good numbers, due to the disappointing announcement from JPMorgan yesterday. SKF and Faz could receive strong bumps, if those earnings are indeed disappointing. Also, there is still a consideration that the tarp money could not get allocated to the automobiles. Although, I still feel it is unlikely, it is possible. There is a lot of opposition to the bailout and it is still a crucial element to moving this market.

Going into the holiday season, volume should continue to get lower and lower, which makes it more vulnerable to volatility. It should be another crazy up and down week as we end the year. I still think we should continue to get gains from the shorts as more and more of this bad news gets factored into the consumer.

I am still loving SRS, FXP, EEV, GDX, and DIG for the next year, as I think they should receive some good gains. Note the recent volatility of SRS lately. Just in the past two days we have seen it be up 30% one day and down 20% another. Even though, I love this fund as a long buy, it could be a great play for you day traders. If you can buy into SRS in the $70's price and sell at around $100, you may be able to turn some quick profits in a very short amount of time. Keep that in mind. Have a great weekend and Happy Trading.

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JPMorgan Warns of Tough Times Ahead - Wall Street Reacts

Well, it seems as if winter may be ending early as there was some movement from the hibernating bears today. Finally, we saw some strong movements from most of the inverse etfs today. As I said yesterday, the “Holiday High” may not sustain into the new year. Negative outlook persisted as Jamie Dimon, the CEO of JPMorgan, went on record to say that they had a “horrible” November and are having a “horrible” December. I can’t imagine the kind of numbers they are performing if the CEO has to prepare the market the way they did today. Like I have been saying all along, financials are definitely not out of the woods yet. The $700 billion was chump change just to help cover their bad debt. It has not stimulated any new lending, and in my opinion, much more “tarp money” will be needed if they expect the banks to start lending anytime soon. Wait until the consumer starts pulling out their money next year, because of the massive job loss. The banks are getting desperate. You can actually find pretty decent rates if you’re willing to work with the banks. This is a pretty cool site where you can have different FDIC insured banks bid for your business. It usually results in better rates. Visit MoneyAisle.com for more info.


KB Toys and EZ Lube were new members of the Bankrupt club this week, which is slowly becoming standing room only. Office Depot said they plan to close 112 under performing stores in North America, as well as six distribution centers. They are also going to cut spending by $200 million. These are the beginning signs of business failure. If only businesses new that you should cut spending in the high times and begin to contract their operations and use the recession times as building, they would be far better off. Many American businesses will now suffer from their past five years of greed. This should add another log to the Unemployment fire as we are looking to have one heck of a Q1 2009.

The auto bailout is still pending as it is finding some adversity in the Senate. Sure, they may have to go back in tweak some things, but I still don’t see how they won’t pass this bridge loan. Media likes to keep people on edge, but I believe it is a lot farther coming along than media plays it out to be. The auto bailout is the one lurking variable I still feel has the power to keep the bull running for a bit longer. I just wish it would be done and over with, so that we all could move on with more normal market movement.

One thing to look out for is next week when The Fed meets to discuss the rate cut. Sure, we most likely will see yet another cut to our already very low discount rate. However, don’t be surprised to see The Fed disappoint the market. The market expects a 50 basis point cut. In doing so, The Fed would be flirting awfully close with inflation and also needs room for emergency rate cuts, as I believe they know we have harsher times ahead. If we indeed see a lower than expected rate cut, that could cause for some negative trading and set a bad mood for next week. At any case, I believe the bears are ramping up soon to take control back of this market.

SRS showed today why I deem it the “Rock Star” out of all of the ETFs. We saw it just about touch $100 today (close to 30%), which I would say is pretty strong. In my opinion, SRS is just getting started. Wait until the commercial loans come do. 200+ stock in my book. SKF and FAZ also had high gains due to the negative outlook given by Mr. Dimon. FXP gained pretty well as Asian markets are continuing to show doubt to investors of their ability to grow in these tough times. Hey, maybe people are beginning to do their research.

I would like to say the selling will continue into tomorrow, but there are a couple of elements that could stir that up. First, we still have the auto bailout lingering out there. If a deal is cracked tomorrow, expect a pretty strong cheer rally. For you gamblers, picking up some GM or F stock may not be a bad idea. Just get out fast again. The second element is that it is Friday. Recently we have seen big runs on Fridays, despite whatever bad news the economy can throw at the market. For some reason, investors have found Friday a good day to buy, although I do believe the bulls are not as ramped as prior weeks. I still like YHOO as a pick up, as I believe it is only a matter of time until a deal is struck. At any case, I am glad to be short right now, and expect pretty strong gains from them the next few weeks. Happy Trading and see you tomorrow.

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Profit Taking Begins - Investors Find Safe Haven in 0% Treasuries


Well, as expected we saw our day of profit taking. Like I said yesterday, a 600 point rally in a bear market is more than you can ask for if you’re going long. Continual negative forecasts and outlooks brought Wall Street back down to reality for today, as people started digesting all this economic data we have been receiving. Personally, I don’t know who is doing the buying right now, because it is sure not the institutions. In fact, I believe the institutions are selling. The Treasury sold $32 billion in 0% yielding 4-week bills. $32 Billion! That shows just how many people feel that our market is in for a bad run. These people are happy having a 0% yielding return, which sounds great if you think a big downfall is on the horizon. Our foreign investor friends and institutions are looking like they are not wanting to roll the dice with the NYSE. Is it really all that surprising? ICSC (International Council of Shopping Centers) announced their negative outlook on retail for the next year. Fed Ex and Texas Instruments also joined the party of cutting their forecasts for the next quarter.

Even though we had this sell off day, we could see the market still continue to be bullish for the next week or two, especially if there is an agreement on the auto bailout this week. However, I feel that the bull is running out of steam. This Friday we have retail sales which , in my opinion, should be pretty lousy. We also have the PPI (Producer Price Index) on Friday, which expectations are pretty low as well. In any case, during this holiday season, there is not much to be cheerful about in regards to the stock market. However, the market has continued to push up and I have absolutely no idea who is buying right now. I think the government may just be printing money and putting it into the market, ha. At any rate, I still think we could see a crash any day. As soon as momentum starts pushing down again, it’s going to be hard to turn that train around.

SRS, my favorite ETF, was best of the shorts today, ending the day up over 12%. SKF also did well, as financial’s green streak came to an end. FXP and EEV were alright, however, I would like to see a stronger performance from them in the near future. DIG and GDX both held up strong despite the sell off. As I said yesterday, energy and commodities are the only buys I like long right now.

Right now, many people are using the “end of the year” term as a scapegoat. Broadcom cut their forecasts today saying that “many of their customers are postponing their purchases until 2009.” Yeah, like things are going to get better next year . It is the same with China and Europe, as they are hiding behind “year end uncertainties” to explain their market instability. The fact is they will use any excuse to hide behind to try and instill investor confidence. If foreign investors pulled out of those emerging markets, they would be killed. As soon as 2009 hits, I believe that is when reality will hit most. Coupled with the exhaust from holiday spending, year end earnings reports, continued unemployment, and slowly increasing energy costs. Right now, we are very lucky that oil has hit such lows. Just don’t expect it to be at $42 a barrel for much longer. As colder, winter months settle in, the demand for oil should increase.

We could see another day of sell off tomorrow, depending on the auto situation. If so, I will probably sell out of some of my long options and finally cash in on my profits. I have good positions in short right now, so no need to bulk up on more of those. If we go green again, I will, however, be picking up some more SRS in the low 80’s or high 70’s. I do expect a red day tomorrow, as I would expect foreign markets to react negatively to our down day today. But, who knows in this market, with these crazy buyers. I hope everyone has a good evening and thanks again for the donations, much appreciated. Happy Trading and we’ll see you tomorrow.

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Bears Hibernate While Bulls Fight Through Unemployment Numbers


Well, it seems as if the bears have called it quits for the time being and are letting the bulls have their fun. Not even having the job loss report by 233,000 more than the market expected can cause a bear victory for the day. I'll give you one thing, Friday's are hard to paint red.

Unemployment jumped to 6.7% from last month's 6.5%. This was 1% lower than market expectation. Many believe this is because many of the college students have just gone back to school, so they are not considered. Even though we have seen big strength in buying this week, I still feel that this trend will be short lived. For whatever reasons, this market is getting shoved up everyday despite very bad news. And I laugh at headlines like the one I saw on cnbc that say "Despite Huge Job Losses, The Worse Could Be Over." I am amazed that headlines like that exist on respectable sites. No one, including myself, has lived through the kind of downfall our economy will experience the next few years. The perfect storm that has combined is one that is yet to be seen in our economic past and to try and predict the bottom of it is pointless. I just don't think we are not even near to it.

After today, the market has proven that its going to fight this out. Now how long will that last? Graphically speaking, we could see this rally go somewhere between 9200-9500, and maybe even more. We will probably see it continue to climb up until the end of the year. Then we will hit January.

January should be an interesting month. This is the month I believe we will start to see a lot of crap hit the fan. I already know of 3 major retailers/restaurants, who have not yet announced, that will be going bankrupt Q1 2009. Even with Obama coming in, which I believe we will get a little rally before and after. But ultimately, I believe this is when the bears will wake up again.

I still feel we are very vulnerable for very bad sell off days like we saw this past Monday, which makes me hesitant to buy anything long. So I have accepted the fact that I may just continue to take some losses the next few weeks. I don't mind hibernating with the rest of the bears until the markets ready.

I have heard many people speculate that we could have reached the bottom and that the worst is over. However there are many reasons that I disagree with this. Here are some reasons why:

1) Housing market is still in the Pits
We should not be confident that anything is getting better as long as our housing market struggles. People underestimate just how important that number is. Housing values are the number one driver of consumer sentiment, because in most cases it is people's biggest investment. All across the county, most people's biggest "deal" has lost anywhere from 20-40%, depending on the market. That takes a lot out of peoples expectations. As long as our housing market remains in the gutter (which our most recent numbers have confirmed), I believe we are not done hurting.

2) Many retailers plan to go bankrupt next year
Think of hundreds of mini GM scenarios going across the country. Even though many of these retailers will not have the giant influences that the big 3 autos do, they still will do their damage. They have people that rely on their pension, and laborers across the country. With the continuing loss of small and large businesses, I don't think you can call now the bottom.

3) Commercial real estate foreclosures
This could be one of the biggest factors. Look what the initial sub prime crisis did to the market from 2007 to 2008. Well, commercial real estate is running about a year behind them. We have just begun to see foreclosures begin in the commercial market. These are going to pile up in 2009. The amount of debt that will be handed back to banks is unreal. It will be World War 3 when that happens, which makes me feel we're not at the bottom.

4) Beginning of the year blues
Historically, the stock market can have very bad months in the beginning of the year. Due to taxes, year end expenses, new years budgets and other elements, the beginning of the year can cause a blood bath for the stock market. Considering that we have just spent that past three usual bull months (except for the last week) in misery, doesn't make me think that will change when we get to the new year. Even after Obama is inaugurated, there will be plenty of things to going awry to make this market suffer.

So these are my thoughts on considering whether we have hit bottom. Although I feel that we could see a lot of green the next few weeks, I still think it will be short lived. I believe in the beginning of the 2009, the bears are going to wake back up and they're going to be hungry. So keep on your toes, get your cash in order, if you don't have a trading account, you can sign up for one and get free trades every month at Zecco.com. Also, for those that have cashed out and are waiting for definition in the market, these guys are offering a good savings account deal with strong interest and FDIC insured. See more at Earn 3.00% APY* in Online Savings.



Just to remind everyone, SRS is under $100. So see, there are many things to be excited about. It is Black Friday for the shorts for the next couple of weeks. Get them while they're hot! I hope everyone has a good weekend. Mondays have tended to be a selling day, but who knows what information will come out this weekend. Happy Trading everyone.

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Consumer Confidence Up - Market Reacts With Mixed Emotions

You know times are getting bad when banks are offering trading accounts with free commissions attached. I thought I would never see the day. In my research today, I found Zecco, an online brokerage company, offering free trades for new account sign ups. I think you get 10 free trades every month and then it's only $4.50 per trade, wow. There platform was pretty solid too. I am highly considering switching over from my rip off platform! Anyway, if you're interested you can find more info at Zecco.com


I think it was only two days ago you couldn't go to any financial related site without seeing the words, DEPRESSION, MARKET CRASH, FINANCIAL CRISIS, etc. Today, it seems as if everyone is back to normal, like the past 6 months haven't even existed. Today, we're seeing, THE WORST IS OVER, WE'VE REACHED THE BOTTOM, WELCOME BACK BULLS. Oh how quick we are to forget. I compare this time much like the eye of a hurricane, except that the back part of the storm is a category 5, compared to the category 3 we just weathered. Historically, holiday season is the bull time of the season. So I don't find it that shocking that our markets are holding up relatively stable (only for the past 3 days!). Also, considering that we actually increased in consumer confidence this past month (the market expected a loss), and we still barely made it into the green today, makes me still incredibly skeptical about the market and a strong believer that the worst is still very much to come.

To increase the good fluff, Secretary Paulson discussed the continued efforts of lowering mortgage rates by purchasing mortgage debt, hoping to unfreeze the very frozen financial markets. Obama has also discussed his plans to cut spending to help balance the budget after the spending of the huge expected dollars needed to help fund this multiple trillion dollar effort. I also woke up with a gold nugget under my pillow. Words are words, and although they sound inciting and persuasive (especially out of the mouths of politicians), it is a lot harder than people think to get all these problems fixed. Even if we made the perfect move, every time, it would still take over year to get everything sorted out. Once again, we find ourselves in a false reality with talks of good news to try and over power reality. Holiday cheer helps with keeping spirits high, but I believe we are in for a mess in or even before first quarter '09.

Nobody talks of inflation (in fact everyone talks of deflation worries), however when we bounce from this thing, I see us bouncing right into hyper inflation. I mean the discount rate is almost down to 0! Sure the Fed can quickly meet to tighten money supply, but I still see interest rates heading back toward the teens, at least for a short period. There has also been a severe over correction on commodity prices. We could see a quick jump back up with commodities as we regain some of our footing. This could also lead to a quick inflation. This is why I have been extremely bullish on Gold.

I don't believe, aside from mortgage debt from houses, much of this credit crisis has hit the actual "consumer" yet. Sure, many have lost their jobs and may be living off of severance or unemployment right now, or maybe even an emergency fund. Try being jobless for a year, unable to open any lines of credit, with unemployment checks running out, 3-4 mouths to feed and nowhere to work. I think we are headed for these types of times for Americans. As much as I want to rebound from this crisis, and make some money on the long side again, I just can't find the will to believe the worst is done. So believe what you want to, I personally feel that the worst is still yet to come.

Overall, it was a pretty good day for me. I saw green in almost everything. Both FXP and EEV ended in the green, while UYG and DIG also continued to receive. Even though I remain very bullish on gold, I sold a lot of my GDX options today (more than doubling my investment), only because I think I can catch it again on another dip. Anytime I can double on the long side, I take it! I just think even gold will get brought down with the rest of the market again before it pops good. China continued to show weakness yesterday with doubt creeping in and many feeling like their gains the past few weeks have been a little too optimistic. I believe that perspective will continue for a while.

I am continuing to hold on to my UYG and DIG. Even though I believe our woes with oil is still not over, OPEC meets on Friday to discuss the possibility of maybe yet another cut in supply. This usually causes a nice little pop. What I have noticed, though, is to usually sell out of these "anticipation pops" the day before the news is announced, especially in this market. Usually, after the announcement we are finding a lot of "over anticipation" and correction in value and can sometime eat into your profits anywhere from 3-6%.

SRS was almost in purchasing position. If it gets below $120, my round of buying will begin once more. Also, for you day traders, SRS is a great intra-day trading fund. Today, the spread on SRS was from $125 to $152. That's a 21% spread. Time the bumps right, and you can make a pretty healthy 1 day profit. This goes the same for SKF. It should be interesting to see how the market reacts tomorrow, being a day before a holiday. It's almost like a mini Friday. I think we have been itching for a pretty strong sell off, so don't be surprised if we spend most the day in the red. However, we are in a state of "bailout fluff" again, so more news could still bring some gains. I just think people want to pocket some of these recent gains and go and buy their turkey. So expect to probably see us teeter tottering back in forth from red to green, like we saw today.

I think the resistance we're seeing during this "bull season" is showing that we are definitely not out of the hole yet. Not even close. This year's black Friday has to compete with BK Friday, who are all the retailers liquidating their inventory for Chapter 7. Housing sales got killed today, which was expected, but was barely noted behind all the noise Paulson was making from the podium. While volatility still remains high, and volume is still higher than average, we continue to be in a vulnerable state for market failure. Stay on your toes, and watch out for investing in retailers for the holidays. Their usual holiday bumps they receive, could be replaced with losses this year. Have a good evening everyone and Happy Trading.

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Citigroup Bailout Spawns Monday Dow Rally

Well, it wasn't the announcement I expected (thinking it would be the GM bailout), but its resulted outcome is similar to what I expected. The government announced that they would back up Citi's assets which was a sight for sore eyes for financials. Financials took one of the nastiest beatings of history last week as we saw several banks heading below the $5 stock range.

The announcement caused, once again, another one of these aggressive, emotional rallies which sent prices flying. Goldman, Morgan and Citi were all up over 30%, while UYG was also up close to 30%. This drive in financials brought the rest of the market up while people began to see some optimism in trading. Talks of what I like to call "The Obama Bush" stimulated some confidence, as people feel they are united in providing another band aid, I mean bailout before the end of the year. However, I still believe we are no where near the bottom.

Sometimes I find days like this comparable to an acid trip or some other form of distorted reality. Off of speculative news, people are able to forget all the problems and failures going on across the country (and world) and believe we are all well again. This is why you should not mix emotion with investing.

All the shorts took a beating today, which means one thing for me. They're almost ready to be bought again. SRS and SKF took massive beatings, which made me grateful for getting out of my SRS position on Thursday. FXP was also down with the mix, but held its own far better than most of the others. EEV took a hard beating, due to the strong week opener in Europe yesterday. I did pick up some more EEV at $80. Even if it continues to go down in the short term, I think this is a steal for this fund. Even though the shorts have been beaten hard, it only takes 2 to 3 days for them to bounce back. I probably should have sold more on Thursday just to get the gains and re-lower my basis, but hey, you can't always get it right.

On the bright side, my long options went off once again today. I made 30-40% in every single one of my long options. GDX remained resilient as did DIG. Also, I finally got the love I was looking for from UYG. See, in one day you can see your options soar. Having these options actually kept me in the green today, despite FXP being down. This is exactly why I hedge with them.

I was very close to pulling the trigger with some of my long options and selling off some of my profits. I just don't think this rally will last for very long. However, these options are what is keeping me in the green right now, so I would rather take the loss on a down day tomorrow, than risk not being hedged for another rally. I may regret it tomorrow, but I still think this bailout hasn't completely fizzled yet. People believe just because Citi gets bailed out, all of the other banks are saved. That's impossible. All it will take is another big bank going under to tank financials again.

We do have a lot of forces pointing to a down day tomorrow. We have the consumer confidence report, which could shake things up a bit. Coupled with that, we could also see some healthy profit taking from the last two days of gains. We saw some sell off hit towards the last few minutes of trading today and on into after hours. If so, I will probably sell out of my UYG options (as that one worries me most) and maybe my DIG options. I plan on holding onto GDX(as well as my Apple), because I still think we have a ways to go with Gold. If we are indeed up another day, I will definitely sell out of my DIG and UYG options, while holding onto Apple and GDX.

The market is just getting more and more volatile, which makes me more and more nervous. It is amazing how quickly people's outlook changes. If you continue to look at the fundamentals and see what is to come in 2009, I don't know how you believe the worst is over. These short term bumps just set us up more and more for a crash. I may have to hang out with my inverse ETFs for a bit, but I remain VERY bullish on them. In fact, if I can see SRS get below $120, I will be back in that Rock Star.

China showed weakness yesterday, especially in their banks, which is why we saw less losses from FXP today. I believe there is a lot more of this to come. World markets should respond pretty well to our jump today, so EEV may struggle again tomorrow. However, keep an eye on these key economic data announcements that come out, because they can put a quick halt to this joyride we're on. I feel very happy about today, considering I have now made a very healthy profit on my call options and hopefully get deeper into some shorts for the downfall. I hope everyone had a good weekend. I will see you tomorrow.

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