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

What an interesting way to close the market on Friday. I think it was pretty clear that there was someone waiting with a button to make sure that the market closed above 8000, as that is a pretty strong technical point for momentum. I literally watched it jump from 7992 to 8000 in the absolute last second of the market. At any rate, it was still big for the market to be as down as it was with: 1. Having GDP numbers be better than expected, 2. Having two strong days of selling after beginning the week in the green, 3. Having a Friday end as a red day is a rare things these days. So, I think we definitely have some downward momentum, but not quite enough yet in my opinion.

It is very clear that deflation is here, as we can see with the huge drop in real estate prices, oil, and precious metals. Eventually, I believe this deflation is going to lead to a deflationary down spiral and eventually capitulate. I do think we're very close, but we're not quite there. I heard a good analogy yesterday describing the state of the S&P. Under 820, the market has a cold, under 800 the market has caught pneumonia, and under 780, we're on our death bed. The technicals show us very close, but not there yet. As a result, we are vulnerable to these quick, short-term rallies that can be very, very violent. So, as I said a couple days ago, I have adjusted my investment strategy to make quicker trades and shoot for lower returns. I'm not ready to go all short, but I am very close.

So I did sell off most of my FAZ on Friday and a bit of my SRS shares that I had purchased a couple of days ago to pocket the return. I sill have plenty of short to reward me for another down day Friday, but I have a lot more conservative plays as well. I'm playing this market a bit more conservative than usual as I feel with the possibility of these violent rallies, I don't want to be caught with as many shares that I have usually been holding. Weekends always tend to have surprises as the government likes to let new hopes brew with investors over the weekend. This is why I have big positions in DGP, GDX, TBT, and UUP(see the market trend report below for UUP +90, Get your own symbol analyzed for free, all you need is a name and email, Click Here). Yes of course I have my FXP, SRS and EEV, which I continually have, I've just lowered my positions a bit until we see some more technicals triggered. Don't you worry, they're coming.

As for now, I don't want to roll any dice with Mondays as who knows what news come out this weekend. Obama has already attempted a "premature hope rally", by announcing his "promises" to increase liquidity in the banks and get the flow of money started. Sure, anything else Obama? Why don't you just create mana bread for all American families. He's obviously hoping to dupe the not so wise investors again, and oddly it may work for one or two days, but unless he has the secret to life, there is not much anyone can do to unfreeze the markets currently.

At any rate I plan on waiting around to see how the market reacts on Monday and make my move. It's a toss up at this point. I would expect to maybe see some green rallies next week, and maybe even become quite violent if announcements come forth. So, I'll play it by ear. These rallies make the market even more vulnerable for failure.

I thought I would end on a funny story that happened in China the past week. In Hong Kong, it is tradition for their equivalent of a "CFO" of the country to perform a stick shaking ceremony, in which generates a fortune for the country for the next year. In shaking a bundle of sticks, one stick falls out of the bundle and corresponds with a sequence of numbers, that in turn generates a fortune. Well, this past week, the fortune which was given was horrible. It talked of depression, economic turmoil, and much suffering. The people of China take this ritual so seriously, it caused quite an uprising and even some rioting, as people feared the fate of their country. The Governor eventually had to make a press statement to say that the ceremony was only traditional and did not actually reflect the future of the country. I found this story amusing, since so many people think China is good place for investment. Ahhh, the naive.

So we'll see how it goes. Some people had mention Zecco.com trading their rates. The new minimum balance of 25,000 for free trades is true, however, you can also get free trades if you make more than 25 trades a month, which I assume most of you, like me, are doing. Still one of the best deals I've seen out there. So there's some information for you. Also, just a reminder, only 2 more days for the Lending Club promotion, win $100, see here. Have a good weekend everyone, Happy Trading and we'll see you tomorrow.