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

Fog continues to dawn on the market as we yet again experienced another up and down day of trading, showing that investors have not quite made up their mind of what they want to do. It also shows that day traders are still very strongly running the show as it seems institutions are still sitting on the sidelines. I was surprised to see a lower volume today, compared to the last few recent trading days.

The market spent most of the morning trading in the green as there were numerous talks of several very large mergers, including the Genentech buyout. Also, banks received a lot of love with some help from Mr. Buffett expressing some kind words about Wells Fargo in his interview this morning with CNBC. He also said that banks were in pretty good shape and that they should be able to "earn" their way out of this, but that banks need to get back to banking. Buffett went on to say that indeed our economy has "fallen off a cliff", but that there is a lot of hope for us in the future. I love how the market reacts more from encouraging words from a corporate executive than our own President and Secretary of Treasury. Shows how much confidence we have in them. The market did rather well during the Buffett interview, only to fall when Obama showed his face to talk about the approval of stem cell research. Thanks Obama.

It was nice to see a good bounce from oil and financials, considering that 80% of my long positions are of the two. We also saw more love for the US dollar, which weathered well for my UUP shares. Gold took another hit, edging its way down near that $900 level, which makes me very tempted to pick up some shares. Another strong down day for gold, and I am most likely getting in.

Other than that, I can't find much to extract from today's trading. This market is wanting to rally, you can see it. It just lacks a spark to do so and until then, unfortunately we may see these flat trading days where short traders dominate the close. If indeed a spark does come (don't ask me what that will be, I think Buffett tried today), the rally could take off pretty aggressively. However, we are running out of time. Sooner or later, more bad news is going to hit the market. That is what happens when you are in a recession/depression. So each day that goes by without bulls pushing this market up, is one more day closer to a big sell off day. I would have think if bulls don't make their move this week, this market may be toast. This would not be good for me as I am not prepared full for the market to crash. Well, at least I wouldn't be losing my shirt either.

So again, I wait patiently for the market to make a direct move. Although some may argue that having us close another day in the red is showing more signs of the crash, there were enough positive movement to unable me to come to a clear conclusion. The rally for financials was big, considering that it has been financials that has been the downward driving force for the market in recent weeks. If financials can continue to gain ground and investor confidence, this could be what sparks the rally.

NASDAQ has been recently showing weakness in trading after its rather strong trading month in February. I think the NASDAQ could be the next to get hit hard. For many people's portfolio, some of the only stocks that still have value are their tech stocks. If they need to liquidate their stocks for cash, they will most likely to sell their GOOG rather than their BAC, considering GOOG is still in the high 200's. QID is one that I am most definitely considering to get in as well, when I find it a good time to load up heavily on shorts again. It had a nice 4.21% bounce today. So we'll see how that goes. QID's Market Club report score is a +70. Looking very strong and I only see it getting stronger (get your own symbol analyzed for free, all you need is a name and email, Click Here).

Tomorrow should be interesting to see what the market does. For those that emailed me about Carbon Sciences and Origin Oil, you should have received a response from me giving you more information. If you did not, please email me again and I will get you the information. Also, my Lending Club continues to yield very strong returns. It can also be a great source for those of you needing to consolidate your debt and not get caught with the very large credit card interest rates. You can get a loan as low as 7.5% to pay off that 15% and higher debt. Below is a recent news video that CBS featured on the company Lending Club and their successes.

This was my exact concern that I discussed in my post last month about the government having no more bullets left in the barrel to take down this enormous bear who has been eating at the Dow for over a week now. We saw this same trend in October and November. Whenever the market begins to consistently show strong bearish tendencies, it transforms the whole sentiment of the trading world. Almost every article you read is talking about worse times ahead or what the government needs to do to get banks nationalized. In the past, to stop such pessimism, the government usually came in with a very significant announcement to reverse the trend, such as lowering interest rates, discussing new stimulus plans, or the even the event of getting a new president filled with hope. Where we have found ourselves now, is in a point where there is not much more that the government to do or say to make things better that doesn't involve nationalizing companies and wiping out shareholder's equity. Sure they can send out Bernanke, Geithner, or even Obama himself, but the market has recently shown that they are done with the small talk.

It's hard to pin the blame on just one person or even one part of the government. I don't know who expected to see this market turn around anytime soon. Back when the stimulus was approved, we all knew that this was a "preservation" stimulus, to help slow the pain getting injected to the economy. This is why everyone was careful to say that the stimulus would create or "maintain" up to 3 million jobs for Americans. The market is becoming very impatient.

So, now we are left with a broken down market, with what looks like to have no reason to get better anytime soon, especially when you have auto sales, non farm payroll, and unemployment right around the corner. Unfortunately, this environment makes it very difficult for nature to take its course and we find ourselves in one big ping-pong match from red to green. Sure, some daytraders are probably having the time of their life (if they're playing the right bumps!), but as for me, I am hoping for a bit more normality and conistancy to return to the market. It is not seeing the market continually go down that makes me nervous, but it is the way that the market is doing it which gives me great concern. Almost all technicals have been thrown out the window and anything that can be perceived as good news is quickly trumped with a hard rush of selling.

I am amazed at how well the trend of mid day rallying followed by rapid sell off to end the day is holding up. Many investors are increasing their turnover and changing their hold periods from 3 days to 1 or even half a day. Instead of covering their shorts after 3 days, they're doing after half a day. As a result, you pretty much have 2 options in the current conditions; the first is to roll the dice with day trading, which if you roll well, could be very profitable, however very risky at the same time. The second, which is my strategy, hold tight a bit longer until we see some definition come through the market as it always eventually does. It is very obvious that markets are wanting to rally, as we see plenty of green throughout the day. Buyers are just missing that extra wind that they usually would get with government help. A continuing to delay a rally, however, makes the market very dangerous and could set it spinning down hard. So we'll see.

I'm keeping an eye on RIMM. Their strength today, despite tough conditions makes me suspicious of upcoming positive news. Under $40, I definitely think they're a steal anyway (in a normal market), so I may jump into some options for RIMM. Anymore down ticking and I'm going to have to eventually consider some shorts again. Maybe FXP due to more and more problems in the Asian markets or even more SKF. If we do indeed rally, SSO is one I would like to take a ride during a bear market rally. So all of these are on my radar. Rimm has a Market Club report score of -70, but has been steadily increasing (get your own symbol analyzed for free, all you need is a name and email, Click Here).

So, yes, the patience continues and I am confident that eventually it will payoff. It is times like these where you can loose your shirt if you play the wrong move and playing catch up is never fun. So these next two days are very critical to see if these lows continue to hold and if the S&P stays under 700. I am making money everyday, but the gains are much more moderate than I would have hoped for at this point. My Lending Club investment is performing very well, and still maintains that 10.5% target return on my investment. They are getting more love from the media as well, which has been great and can also be a very good resource for those needing to consolidate there expensive debt. I'll be on chat early in the morning, so with that, have a good night everyone, be careful, Happy Trading and we'll see you tomorrow.

Any hopes for new beginnings for the stock market this week was quickly put to rest as the markets opened down and didn't manage to get anywhere near green territory throughout the duration of trading hours. The Dow closed under 7,000 at 6,763 and the S&P closed just above the scary line of 700, being the lowest in 13 years.

Starting the week on such a bad note can not be good for traders looking for green in the markets. With unemployment news coming this Friday, starting the week on such a bad note sets a negative tone to a week with what looks to have a bad ending. No doubt, having AIG post the biggest losses ever caused for negative sentiment to last throughout the day. We knew it was coming last week, so I don't know why everyone was so surprised. However, amidst the tumultuous turmoil, my schizophrenic personality still remains. I have indeed been doing pretty well during these down trading days, just not as well as I would have a week ago, when I was still in a lot of my short positions. Even though it seems as though nothing but bad news is swimming around us, I do not feel this is the time for me to push the chips into the short side. Here are a couple reasons why:


Deflation
Although we have indeed experienced deflation, we have not to the degree I think we will. A deflationary down spiral was a key factor leading markets down during the crash of the Great Depression. During the crash between 1929-1932, although a big drop happened in 1929, the greatest damage by far was between 1930-1932 following the deflationary down spiral. So, even though it seems that we are in the worst of the storm, I still feel there may be worse times ahead.

Markets Oversold
There are strong technical indicators that point to the markets being oversold. Just today, 97% of volume was down volume. This is a ridiculous number and, historically, is usually followed by a strong rebound rally. Markets did put up a fight at their strong resistance points, however, faulty government plans and strong negative commentary has helped to push markets further down. Just as markets were being over bought towards the end of the year due to these factors, we are experiencing similar trends on the selling side.

This is not to say I don't believe we could keeping selling our way into a crash. Of course that could happen. I just feel that we are not quite there yet. I try not to listen to the banter of commentators and analysts, as they waffle back and forth on positions quicker than John Kerry did. It is amazing to see how quickly they will change their position of whether we've hit bottom or we've got a ways to go. I blame them for a lot of the clouding of judgement for people to make logical, sound investments. However, some of you may feel the same of my "banter", but hopefully you know these are truly my own feelings and thoughts and that of course the market moves at its own desires. I just try to tell it how it is.

People are saying that the S&P closing over 700 todayis a big hold for technicals and shows some strength. I don't know how much I buy into that, as whether it closed at 705 and 695, it was a horrible day for the market. I do think there is potential for a rally at some point this week, but I don't feel it will have much to do with the S&P closing above 700.

Then there is unemployment. Do you remember playing the game Monopoly and approaching that part of the board that was densely owned by your opponent, in which he/she had also put a variety of hotels and houses on the different properties and just praying that you rolled that number that sailed you right through that section or at least landed you on a chance? Well, that's kind of how I feel approaching unemployment. We know it's coming. I feel it is going to bad, as it has been lately and investors are just hoping that somehow we can "roll" right past it this month and hopefully move on until the next announcement. Well, I don't know if that will be the case, but I thought I would share that metaphor. At any rate, I expect there to be negativity with the number.

So I am continuing to wait patiently for a time I am comfortable to take a more aggressive position on the short side. We saw great gains from all the shorts today and are seeing more love roll around for FXP, which is always good to see. Problems seem to be magnifying in Asia, which could bode well for FXP. Believe me, I would like nothing more but to be in a strong short position, but if indeed we are due for a bear market rally, we have seen how fierce they can be and how quickly they can kill profits from the short side. I do not wish to be the "Dump and Dump", single minded bear activist and say nothing but bad things about the market. I try to make money where the momentum is, and right now I see it on the bear side, but with some short term risk of a rally.

So, on that note, have a good night, Happy Trading and we'll see you all tomorrow.

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I believe this picture does a good job of summing up the activities of today's trading. Seller's torro'd bulls along until the last 20 minutes of trading, where bulls grabbed the bull by the horns and kept him down. Trading was like a roller coaster. Volatility like this is expected in an undefined state of the market that we're currently in, where technical forces are pushing the opposite way as investors. It will indeed be very interesting to see how this market continues to move, especially with rather large announcements coming up to end the week (new home sales and the big GDP).

Existing home sales came in under expectations, which I would hope would be no surprise to anyone reading this site. Much of the morning was spent with Bernanke being drilled with questions by congress. Bernanke did his best to try and maintain optimism and continue to reiterate that there are no plans to nationalize banks. This may be the big factor why many banks ended strong today, despite the down trading for the Dow.

WFC, JPM, and BAC all traded up today as it seemed some confidence was returned to investors in regards to the banking systems. Who knows how long that confidence will last? As far as I know, it could already be gone. Financials are a big gamble right now, which can yield some serious, quick, returns, but can also kill you if you don't watch out. The only move I made in my Zecco.com account today, was I actually bought into some BAC at $5.25 (I should have bought earlier, but oh well), hoping to maybe see a rally to close. We were definitely heading there, but bears put that to an end very quickly. It closed at $5.16 after reaching $5.50. I've got some pretty strict stop losses on it, so that if we start out too bad tomorrow morning, I will close out of that position. BAC Market Club report trend score is -75, so it is moving up (Get your own symbol analyzed for free, all you need is a name and email, Click Here).

Not much has changed from the stance I had yesterday. Indeed, we ended down, but the S&P has continued to stay above the November 20th lows after our dip two days ago, which is a stronger indicator than the Dow, being the bigger index. So I still feel the market is vulnerable of a rally. I have not strongly positioning my portfolio for a rally, because as we can see, there is sill a lot of skepticism in the market. So I will continue to make small, conservative moves until I start to see more definition in the models. So far, we are right in line for a crash, just not quite now. Of course, none of this is certain, but I like to keep some faith in the technical models. We could indeed drive right into a crash this next week, so I'm not ruling that out either.

TBT was back in business today, closing over 3%. I love that fund for right now. I can't picture treasuries more overbought than they are now. Buying in back at $36 in December was a good move. My FAZ put option reached some new highs today. It got all the way up to $18. Having gotten in at $10, I was very close to pulling the trigger. However, I didn't. Hopefully I do not regret it tomorrow. I just need to keep reminding myself to not be greedy in this market! So far the put option has worked very well for me.

I expect tomorrow to be much like today was, a lot of volatility and some uncertainty. If bulls plan on taking this market for a rally, they best get involved soon. With the GDP announcement coming Friday and more AIG woes next week, they are running out of time.

I still see a lot of strength in SRS. I do feel though that it may be reaching the low 60's to mid 50's soon, so I'm waiting patient to start loading up again. A lot of the commercial real estate problems still haven't surfaced. I mean this week GGP (General Growth Properties) announced in their earnings that they are $1.12 billion dollars overdue in debt and have an additional of $4.09 billion in debt. How on earth do they plan on solving this problem in our current market? Oh the woes heading for commercial REITS. Ouch.

So, I am staying tight, waiting for the right time. It's getting real tempting for me to get back into a strong short position, but I've been caught before on the wrong side of a rally and I don't want to experience that again. It's worth it for me to wait until the timing is right and then really go for a ride. Good chatting with you today on the site, I'll see you all tomorrow. Happy Trading.

Well, our week long streak of bear hungry selling was finally put to an end on Tuesday as the Dow closed up 236 points (3.32%). Indeed we were overdue for a good rally as I was actually expecting this rally to hit a couple of days ago. Well, it's here now and it will be very interesting to see the strength of it. Will it just be a quick rebound for profit taking, or may we see some continual recovery over the next couple of weeks? A lot has to do with fate of the banks and how the government manages news that continues to hit the public.

Many people attribute Bernanke's remarks to big run up in financials. However, I don't think he had much to do with it. In my opinion, the market was oversold, and was just waiting for a bit of a push to get the engine started. I see it as a technical rebound, one of which may stick around for a while, at least that is what I am hoping for. The selling volume was very low and the number of new lows were minimal, which was a sign that we were quite oversold.

After selling a lot of my gold options last week, I went ahead and got out of gold completely this morning. I do feel that gold still has some more up to go, but I feel that it is vulnerable to some losses here in the short term. The market may regain some of its footing this month, which could bring gold down a bit. I plan on getting back in if we see gold get back down to $900 levels, as I feel inflation will be our next beast to slay after we spend our way out of our current problems. 1990's Japan, here we come. However, my first ride was gold was very profitable for me and I enjoyed the ride.


If you haven't already, make sure to check out the 5 Trends Video discussing the momentum of the major 5 sectors investors are watching. It gives good tips about oil, gold and other sectors. Oil still continues to be on my radar, but indicators have not confirmed a bottom yet, so I am still waiting for a good entry. I don't think there is much more downside for oil, but I can wait.

As we saw today, these violent bear market rallies can take back profits just as quickly as they are given. FAZ and FAS are both very capable to take some serious slashes at your portfolio if you are caught on the wrong side of the rally, as some of you may have found out today. I plan to be very careful the next couple weeks with the leveraged ETFs. Having the Dow close under the 2002 lows yesterday and the S&P under the November lows confirmed that we are indeed still in a bear market. However, the rebound we received today also confirms that we may indeed be starting another bear market rally. So what does this mean?

This is my plan for coming weeks. I am keeping my FAZ Put options (which is much like owning FAS, just more volatile) along with my remainder of SRS (which currently has a Market Club report trend score of +60. Get your own symbol analyzed for free, all you need is a name and email, Click Here) and SKF, which is not much. Besides my energy stocks and miscellaneous tech stocks, I will be patiently waiting. I am going to be very careful on the short side, as we may see a 15-20% rebound with this rally over the next few weeks. I may make some suttle long moves to take advantage of the rally, but not much. My real goal is to get the shorts back to a point where I can enter at some really low prices and be prepared for the big crash, which I still believe is coming. If we do indeed rally, many will believe the worst is done and that we could be starting the bull back up. Be very careful of what moves you make. As for myself, I feel very strongly that is not the case and will wait until the time is right to get back in heavily in the short position. However, I will be patient.

We may not rally from this point, but we have a lot of indicators that we are oversold at the moment and that we could indeed see a strong bump in the bear market. Like today, these rallies could be violent, so watch out. I will try to make it on chat to keep you all posted daily on my moves.

I am very excited for the times ahead. I believe the opportunity is slowly presenting itself to make a lot of money in this market. It's hard for me to fight off my compulsive nature sometimes, but deep down I believe it will payoff for me. So try not to worry if we do indeed see some green over the next few weeks and just think of it as an opportunity to see good prices for the shorts. At least that's my plan.

Tomorrow, we'll talk about Obama's speech and other new factors as they come up. One more week for the $200 Lending Club promotion. If you haven't checked it out, make sure you do, click here for details. So far, my 10.5% return on investment with them has been picture perfect. It could be a great place to park some cash. Have a good night everyone, Happy Trading and we'll see you tomorrow.

Last night, Hollywood seemed at ease as they put on their 81st annual Academy Awards. Little did they know of the storm brewing for the stock market the day after. In fact, besides the "red carpet", the only other red out there is from all the selling in Wall Street. This morning, we actually experienced our first few moments in the green, but proceeded to spend the rest of the day heading downward. Buyers and government intervention (PPT) didn't stand a chance in turning this train around right from the get go. Any sort of attempt of a turn around, was quickly denied, sending the market down further. Finally, in my attempts to try and figure out what the heck is going on, I resorted to the "they must know something I don't know."

Indeed I am a very strong bear right in this market, but by now, I almost feel overfed from the recent down trading days and keep waiting for the days where I start throwing everything up. But that day still never comes. I caught something very interesting that made me quite curious. Indeed, as I said in previous posts, we are long overdue for a "technical rally". However, there has been no such rally and looks that it may not come for a bit. Whenever technicals are over ruled, I try to figure out why. On Thursday and Friday, many of the sellers were hedge funds liquidating positions in preparations for redemptions. This mass selling was a strong contributor to keeping the markets down, even in the face of strong buying surges.


So who was selling today? Believe it or not, but a lot of today's sellers were institutions. Many long term holders found themselves selling today in the midst of the downward treading market. For those of you that don't have upper level trading, you should have seen the bulks being sold. I had not seen anything like it, not even in November. With selling like this, clearly "they must know something I don't know." These guys don't like selling unless they absolutely have to. Towards the end of the day, I think we saw what it was. AIG needing up to $60 billion of new capital to stay a float. They announced that they will be announcing the largest loss in corporate history on Monday. Just what this market needs. Being that the US already has its maximum allowed stake in the company, they are seeking for alternative capital to keep them afloat. Good luck! This news indeed could have been the devastating news spurring the recent sell-a-thon that has taken place the last 5-6 days. I do not see how this news does not continue to linger with us all the way to Monday's announcement.

As of now, we have pretty much passed every major downward indicator for most every major indices. With S&P closing under 750 today and the Dow getting dangerously close to 7000, we are in very dangerous grounds for what could eventually lead into a downward crash. The big question is, can we hold? I have expressed my doubt about this being "the crash" of this market, as the deflationary indicators just aren't hitting. However, that does not mean that it can't happen. Even though we seem low at these current numbers, I honestly feel that when the big storm comes, we will see 500 S&P numbers and it will come fast. By that time I hope to be fully positioned in my portfolio. For now, I will continue with my current shorts I have (SRS, FXP, and SKF), along with my DGP, GDX, TBT, and UUP. I still have some FAZ put options, which I will keep just in case of a strong rebound rally, but for the most part, I remain in cash. I still enjoy green on days like today in my Zecco.com account, as most of my positions remain short.

Tomorrows reaction to today is so, so critical. A failure to hold these numbers may spur a bit of a rally, which I don't see lasting long, but definitely possible. However, another strong day of selling, depending on how aggressive the markets are, may result in beginning days of capitulation. I cannot stress the importance of the day tomorrow, as all analyst's eyes will be on trading. Keep your eye out for some fireworks. FAZ continues to soars with a Market Club report score of +70! (get your own symbol analyzed for free, all you need is a name and email, Click Here).

I hope to see you all up early and on chat (located on the right side of the site, towards the top). It should be an exciting one. Please keep in mind, President Obama is set to speak tomorrow at 6:00 PM eastern tomorrow. So something could be up. Maybe it is the "something I don't know." At any rate, I think it's clear that we have "Broke the Back" of this market and that if anyone still believes in the "buy and hold" theory for stocks, I am sorry, for you have probably lost value in your stocks since 1997, ouch! Also, HBSC is offering some good rates right now, so if you're looking, go to Earn 2.25% APY* at www.hsbcdirect.com for more info. Happy Trading and we'll see you all tomorrow.

PS... You should really check out the newest Big Five Trends Video, awesome and free 5 Trends Video

All eyes were looking for Secretary Tim Geithner on Friday, as the market was looking to close again after another strong day of selling, mostly due to concerns of nationalizing banks. But he was nowhere to be found. Finally, in the moment of despair, Obama sent out his "press secretary" (wow, the powers of this guy!), to inform the country that continuing private ownership of banks was the best option for the country. This caused for a violent rebound to almost green territory, especially with financials, until sellers again prevailed and continuing doubts kept the market down, closing the DOW at a new recent closing low of 7365.

You can see in the graph of today's trading where Obama stepped in to calm nerves, but its effect was not long lasting, maybe due to the fact that is given from the press conference and not President Obama himself or Secretary Geithner. Also, some contradicting items were discussed in the press conference as the press secretary warned that some irresponsible people would indeed be benefiting from the recent mortgage subsidization, after Obama boldly declared that no irresponsible parties would receive any sort of benefit from the bill. Analysts have been having a hay day with the bill ever since it was announced.



What use to be the enemy of bears, has now become a friend. "Speculation" is currently a big driving factor for the mass selling taking place in our markets. Prior to this past week, it was speculation of good things to come that use to reverse downward trading days and send markets flying. This negative speculation has over ridden many of the technical charts and kept the markets selling in fears of bank nationalization. I was amazed to see the movements of FAZ/FAS on Friday (I was on chat with many of you)! FAS went from $3.92 to $5.20 in about 5 minutes. During these times of speculation, we can see some serious violent jolts in the market as nerves increase or are eased. At any rate, it makes the market in a very dangerous and volatile state.

Although the selling is continuing, I am not convinced this is the big "critical mass" selling that we are to receive before we see a capitulation in the markets. The models just aren't there yet for deflationary signals. We are very overdue for a technical rally, and with speculation in the air, it makes me very reserved to make moves. As we saw from SRS on Friday, shorts can become very vulnerable in a speculative state. This a big reason for my liquidating of much of my position on Wednesday.

The only move I made Friday was the buying of FAZ put options for $65. The volatility of options are becoming greater and greater as we saw the VIX rise above 50 on Friday. Just on Friday, the range of my put option was $7-$14 (I got in at $10). So, I am choosing to short FAZ, instead of buying FAS, hopefully decay is on my side this time. This play is mostly a hedge for me, as I feel this technical rally may eventually take hold early next week. Plus, just during intraday trading on Friday, I made quite a big profit. Below is the Market Club report on FAS (get your own symbol analyzed for free, all you need is a name and email, Click Here). We also may see Tiny Tim finally make an appearance to try and squelch the concerns of nationalization better than the press secretary. At any rate, I'm not comfortable with the current models to go any more short than I am already and feel that we are very, very close to critical mass, but may still be a month or two still away. We did indeed reach new closing lows with the Dow, but not with the S&P, which is a more critical reading. So most of my Zecco.com account sits in cash at the moment, but with positions still in my "usual suspects."

I expect to see more stronger and more volatile movements going into next week. It will be interesting to see if speculation continues to drive trading or if we indeed get back on track with technicals. Watch out for the leveraged ETFs, as with the increasing VIX numbers, they become more and more volatile. It's great when you're on the right side of the momentum, but not the other way around. Have a good weekend and Happy Trading.

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