Monday, August 27, 2007

NYT article...

apparently there's a teacher shortage...

Maybe after all these mortgage brokers and hedge fund employees get fired... they can go teach math.

Of course, math probably isn't their strong suit...

Friday, August 24, 2007

Wednesday, August 22, 2007

countertrend rally...

The Street needs to move the markets fast... if they move slow, it gives people a chance to sell. And besides, the biggest buyers are the most bearish people getting scared: the shorts.

Another chance for people to get out while the gettings good. Rate cut dreams and lollipops...

Tuesday, August 21, 2007


nice company... but I bought my first option ever, a put option -- expires in December.

CROX is growing at 25% a year but that still only gets you around $50/share with $2.00/earnings...

Should the market decline... I'm not sure how far a short squeeze can go.

CROX is up $13 in the past 4 days alone.

Well -- it's a little less than 1% of my trading equity in there so we'll see if the CROX can keep it up for 4 more months.

1 in 693

homes in foreclosure?

Someone can do the math here -- several million homes are going to reset over the next year.

July foreclosures up 93% since July 2006...

American dream going down the toilet for many... and destroying the value of everyone else's home in the process.

Still think a rate cut solves this?

Monday, August 20, 2007


3-month T-bills plummet.

Worst week since 1987 crash -- that's something, huh?

Hedgies are racing to raise cash -- nobody wants to touch a mortgage, commercial paper... anything...

Essentially, this will force a rate cut.

But again 'liquidity crisis' or 'credit crunch' is the big illusion.

Sorry, if it were about liquidity, we'd be back over 14,000...

We're sinking because the loans on the books are toxic -- trillions of dollars of loans and derivatives that insure them.

If the loans go bad and the CDS get called to protect the losses -- then the banks lose and whoever is holding the 'insurance' paper and is liable to come up with billions will also default.

The Fed and everyone out there knows it'll just take one big default to expose the problems.

These problems won't go away even if you cut the rate to zero.

the resets that are coming will cause even more bad loans to go bad.

Nobody with a bad mortgage to get out of it -- they can't refinance, any appraisal will cause the individual to discover a big loss.

This is a game of who can sneak their way into cash or offload the worst junk before it falls apart. The Fed is merely buying time for insiders to hopefully sell a few more shares to the public.

T-bills are telling the story.


the downtrend will continue...

A little rally on light volume with oil prices falling... big deal. Oil demand will only increase and eventually, a devastating hurricane will hit the Gulf... so sell it when you can....


CFC and now Capital One are starting to fire their salespeople...

Who's next?

Home Depot?
Retail sales?

-- You can probably think of dozens more... only a matter of time before unemployment is added to growing debt, lack of consumer spending, falling home prices....

Virtuous cycles are always followed by vicious cycles. And when the virtuous cycle is propped up for years by debt...

Nothing to see here, move on unless you're trading.


Everything has settled down for a moment but as you can see, indexes are still trending down and that's the path of least resistance -- and $2 trillion ARM resets coming down the line will cap any rallies.

Good time to trade between fear and hope. Just remember -- there's a lot more to fear than hope for these days.

CROX is up around 55 -- I keep thinking about shorting that thang but it's become the new go to stock these days... and I must admit, those shoes are a phenomenon.

Counter Trend?

Looks like we've got all the makings of a rally here... one that will eventually fade to red but may as well wait before establishing new short positions...

Over $2 trillion i mortgage resets are coming down the line.

Countrywide and TMA can jump a buck today; just means a bigger fall when reality sets in once again.

This is a zombie market now. It may appear to be alive, but no, it's dead.

Friday, August 17, 2007

Record outflows...

small guys are selling at the bottom....

Who woulda thunk? Just before the rate cut.

huge rally...

fades off and volume stinks...

Does this sound like a bull market to you?

opex date...

I just realized the Fed cut premarket on opex date.... excellent -- classic move -- and some participants already knew ahead of time...

All those put options that were deep in the money got blown out and maximized the effect of the cut. If they did this on any other day the reaction would have been half...

These are the moves you've got to anticipate.

Appears the shorts are putting back on their positions though. This was just a brief surprise attack and does not throw the bear market off except for perhaps a day or two, if that.

Let's understand one thing: The housing market IS the U.S. economy. It's not even about the jobs and business homebuilding creates -- it's about the wealth creation / equity extraction that allowed spending to remain in the skies.

The entire U.S. economy -- with home prices plummeting and inventory rising up the wazoo -- is a cripple. The effects are going to hit like mortars that keep dropping...

home prices dropping
job layoffs (construction, banking, Home Depot)
consumer spending (the big one) drops by the month, every month, for years...

The ATM machine has closed.

This was Bernanke's insight -- but he can't stop it now. The expansion in home prices is 40 years long. You can't push a string.

Everyone living with massive debt loads -- which is most of America -- has put themselves in grave danger.

Endgame tactics are exactly as you see: Destroy the dollar to provide one more boost of extractions/refis.

Where can people with money go? They can't keep it in cash -- inflation eats it up. You can't enter the markets without extreme risk.

Stock prices hardly factor in a new world without the U.S. as the engine.

But they will.


The Helicopter has arrived !!!!!!!

Once again: Opportunity to SELL, not buy.

Too little, too late.

I guess the new shorts are a day late, and now a few dollars short.

Thursday, August 16, 2007

Yen Carry Trade...

the FXY peaked at 1 PM -- Can all that borrowed money be returned?

Markets bottomed at the same time and recovered a lot of ground.

CFC near highs...

ETFC is green!

GS up 2points...

pendulum just swung back

QQQQs bounced...

QQQQs went to touch a new low and instead bounced higher as we near the close...

Short position might be crowded.

CFC is putting up a good fight here.

GS is in the green.

ETFC bounced over 30% from today's low.

You get financials settled down and there might be some support, at least until the next horrible piece of news hits.

What else could go wrong?

Probably a lot.

First -- there's real selling out there -- indiscriminate bear market selling... and it could last a long time although it's starting to seem extreme...

I doubt it's over.

Which is not to say a lot of stocks DESERVE to drop 8% today. But that's what happens. People sell and then they sell because they figure other people will sell so they may as well sell first. Vicious cycle... yada yada.

I'm watching certain bellwether stocks.

CFC is important I think. As one of the largest and strongest mortgage lenders -- their fate will determine the market I think. Today's 12% drop is not encouraging.

There's so many problems going to result from all this: layoffs, reduced taxes, more debt, less consumer spending, less profits, more layoffs.... vicious cycle.

Remember: The markets never really should have gone up at all. I was shorting the indexes last August before they ran up 3000 points. I thought it was expensive then. Now they're still 2000 points above that.

But again -- a lot of stocks are actually cheap now.

But this is not about 'value'. It's about psychology.

There is probably trillions of borrowed money that need to unwind. It'll take time.

Once it's over - -the cash on the sidelines will return to the good stuff first.

First we need to hear about at least 20 - 30% of all those hedge funds out there closing shop. And each one will need to liquidate -- causing another to be forced to liquidate -- forcing another....

See how these vicious cycles sneak up on you?

good quote:

All truth passes thru three stages: First, it is ridiculed. Second, it is violently opposed. Third, it's accepted as being self-evident."
--Arthur Schopenhauer

where does it turn?


credit crunch induces panic and redemptions... more selling


highly oversold conditions
record short interest
most traders already in cash
rate cut coming in September
lots of good value on sale
redemption from hedge fund window just closed

-- gap down today -- Dow was set to open -200, now -64 an hour later... the market ended with a gap up flurry.

Quite a few

Aug. 16

Dow is going to start the day -200 points or more?

Today should be for the history books.

All over but the crying now.

Wednesday, August 15, 2007

Wrong again?

Remember this from Aug. 8?

"President Bush struck a reassuring tone Wednesday about recent turbulence on Wall Street, saying he believes the markets will work their way through safely and achieve a "soft landing."

At least he's consistent about being wrong about... everything.


Song just popped in my head:

Somebody's gonna hurt somebody, before the night is through.
Somebody's gonna hurt somebody, and it might be you...

some good news...

a few positive developments and the market is up slightly...

normally the market would be up 100 points already...

a bit jaded, is they?

shorts might be covering, but who's buying?


Not me, that's for sure.

easy credit ripoffs...

No more.

Let's see these hedge funds operate with their knees cut off.

The river will run red.

Tuesday, August 14, 2007


What a stock is worth is what people will pay for it. Period.

No one's gonna buyout your 'value' play anymore.

Remember that game?

Ancient history.

gold sleeps

while everything is bouncing around...

Why has gold fallen asleep the past 3 days? It's about the most boring etf out there...

Into the abyss...

This is really about greed and corruption controlling our society which inevitably leads to collapse.

$300 trillion in notational value of fake paper.

You've got banks that are most likely in default right now but pretending not to be. They have no protection against the losses that haven't even begun to hit them -- especially in subprime markets.

Leading to lower home prices...

leading to reduced consumer spending...

leading to lower profits...

leading to layoffs...

A world built on debt will crumble.

Why was this one of the longest bull market cycles ever? Because everyone knew when it stopped -- the game would be over for a very very long time. So they did their best to keep it going.

Down we go, kicking and screaming...

The Fed can't save us, they're the reason we're here in the first place.

Monday, August 13, 2007


Now what if all the bearish predictions come true?

I think the problem is -- we can't imagine what the world would be like. Just like we couldn't imagine 9/11 before 9/11.

A derivative meltdown would probably be worse.

It could start with a stock market crash of 20% or more.

But that would mostly affect the wealthy.

The true horror would be the sudden collapse of the dollar. Gold would skyrocket as all the goldbugs predict as banks go into default, causing untold bankruptcies. The U.S. Gov't would face an enormous deficit -- no tax revenues.

The national debt goes into default.

Nobody is willing to buy Treasurys.

Interest rates skyrocket -- killing the economy.

People are laid off in the millions.

They can't afford basic needs. Food, oil, medicine jump in price.

Why are all these banks pumping so much liquidity into these bad loans?

I think the alternative is the beginning of the nightmare.

But I get a sense -- if you've read enough history -- that the collapse of world powers occurs just like this.

The fall of Rome was almost precisely about debt. Too much expansion, not enough economy, too many poor people, and just a small elite class to rule them all. Doesn't work in a democracry.

Is there hope? And if so, who could save the Republic? Not the politicians. Not the brokers who trade fake papers.

If there is a day of doom coming, what can we do now to protect ourselves until it washes over?

I don't know either.

Bonuses coming

You'd think all these bad bets would mean pain for the Gamblers.

You'd be wrong.

This is how the world works.


I bought this today around 12.50.

Where are we technically? CYPB is testing the 20 day MA around 12.37 (I bought more under 12.30).

This is a biotech co. that incredibly, is slated to earn, yes earn, over 60 cents next year and trades near 20x earnings...

The stock had doubled in a day a few months back and has been retracing ever since.

It appears to me a bottom was put in and now the stock is testing this new uptrend.

I have a stop around 11.65 which would mean a complete failure of what I think is a new uptrend.

Lately I have been making very small purchases -- but enough to allow me to gain more experience without going bankrupt.

CYPB is kind of an off-radar trade for me so I know it isn't crowded.

Stocks that smallcappers love recently include AEY, NGA, CRNT -- these are what I consider crowded -- well distributed and thus, prone to failures. If everyone owns it -- who's left to push it up?

200 day MA

I'm noticing a lot of my favorite stocks have recently touched the 200 day MA and it turned out to be a good time to play the bounce...

Will these stocks keep rising now that the technical bounce is done?

I'm thinking no but I have no money at stake anyway.

My guess is the market only appears to be stabilizing.

Song just popped in my head:

I see a bad moon rising.... I see trouble on the way...

more bailouts...

Goldman gets $3 billion.

I sure wish someone would keep me giving money to lose money...

Being rich means never having having to say you're wrong.

Sunday, August 12, 2007

patterns: SPY

bear market?

Not only does this chart look just fine -- recent history show buying when the SPY full stochs dipped under 20 was a great entry point. But the stochs would need to come back above 20 first.

Although, of course, every pattern eventually fails...

Zen: Beginner's Mind

Shunryu Suzuki was a Zen master:

He says, "The most important thing is not to be dualistic. If your mind is empty, it is always ready for anything; it is open to everything. In the beginner's mind there are many possibilities; in the expert's mind there are few."

There are great trades swirling all around us every day. Do you see possibilities? And if you trade, are you willing to let them go when they go against you?

The market is a swirl of chaos, fear and greed. The Zen master remains calm in the center of the wheel.

Can you be calm amid the chaos?

Saturday, August 11, 2007

Zen anyone?

One of the main ideas of Zen is simply this: Things Change.

And my haven't they changed?

Almost sad to see the Fed desperately helping (bailing out) the stuck bankers.

Read the biography of Charles Ponzi -- it's a great book.

Imagine a man who was paying interest using money from more recent investors. And as the money flows in and then suddenly all the early investors want their money back and the flow of new investors stops -- you know Ponzi is stuck. (It didn't happen that way -- the government shut him down.) But imagine instead if the banks kept giving Ponzi money to keep paying off the old investors...

With infinite credit, you could indeed run a Ponzi scheme forever.

What you're seeing is the attempt to keep a Ponzi scheme alive after the investors have seen the fraud.

The next few weeks will just a kind of whimpering half save that will actually probably result in a worse crash than it should be.

You can't rescue foolishness.

If you gambled away your life-savings -- should a bank loan you another 500k so you can try to get back to break even? Do you think they would?

Why should the credit crunch be solved peacefully? Why should banks be allowed to continue to lend money to degenerate gamblers / subprime lenders over their heads?

All these products, CDOs, MBS, junk bonds -- they are not worth what people think they are worth. This is not business. This stuff is nothing but paper. It's moneyland that creates money for the benefit of the brokers who buy and sell them.

Self-serving business is wasteful. There are about 9000 too many hedge funds in existence today.

I believe their elimination will only benefit the small and large investor. What will these people do instead?

Maybe get a job as a compliance officer for the SEC. God knows we could use a few thousand more...

Friday, August 10, 2007

weekly summary:

/Users/markfeldman/Desktop/BEARHEAD for bumper sticker.gif

Thursday, August 9, 2007

As Kenny said...

You gotta know when to hold 'em.
Know when to fold 'em.

Know when to walk away...

Now's a good time to run.

Wednesday, August 8, 2007

stick to your guns...

the best stock I bought this year was CRNT at 5.95 -- it sank to 5.20 at one point...

I couldn't believe it. Well -- in the end I sold too early -- but it hit 18 today.

Stick to your guns.

The minute you start trusting someone else -- you are gone.

If you do real homework -- and not just following some 'system' or half-cocked idea -- you will be rewarded.

All the screwing that takes place is the result of people losing conviction, following the crowd, getting fearful -- and hoping for too much.

Focus on the trade, not the money. If you buy a stock you believe in and it fails after a year or so -- then at least you did what you thought was right. But if you're trading because you think someone else thinks it's the right move -- then you'll have no conviction and you're at the mercy of strangers.

Do the opposite...

Today I own


You'd think it'd be hard to hold 4 losing long positions with the dow up 190 and Naz up 65.

But I managed to find a way!

VPHM punished...

I just had to buy a little under 12 today.

The board is stunned on today's downgrade. The huge short interest position will eventually cover -- all they need is for the stock to collapse. I guess if you don't have bad news, you manufacture a downgrade then make it collapse yourself.

I'm calling it the bottom today.

good article:

summary: It's not about how often you are right. It's when you win, you want to win big. do that and you can lose money 90% of the time. You just need to have conviction when it's going your way and not drop the winner.

ELOS: FDA approval...

You have to wonder why the stock was absolutely killed yesterday -- the day before a major PR.

ELOS gapping up pre-market but so is the rest of the market.

Apparently there is no market crash coming after all.

In new ideas: I am going to be watching APLX now that it's on the 200 day MA. A fine software company taking a breather. But if I know a thing or two, there will be more manipulations to make it look a lot weaker before a turnaround.

Shorts just can't win can they -- unless they're quick.

Tuesday, August 7, 2007

What I think...

I think now that there are 9000+ hedge funds out there all screwing around -- anyone using 'classic' technical chart skills is itching for a beating.

The constant see-saw crazy action is probably hedge funds using the volatility to swing trade around core positions and nickel and dime scared investors.

You've got to have fundamentals... then you've got to have patience.

Faith helps, too.

But mostly the patience.

Cramer on ELOS

Cramer just happened to have the CEO on ELOS on his show tonight -- the day I buy in and get hammered...

Now Cramer pumped ELOS once before -- the stock shot up the next day and has been dropping ever since. Now he's a little more cautious, despite a lower price, better earnings, more cash. He just can't recommend a stock that's not already in a bull trend. Unbelieveable.

Wow -- and it appears AH it was trading above my buy-in price... guess they still don't mind being hosed by Cramer.

The stock was obviously under the shorts today. You just can't bet against them. Like the guys shorting AMZN, NILE, TNH -- if it's a low floater -- you are absolutely fucked. No way are they letting the shorts out -- the shorts become the sacrificial lambs who will be forced to cover -- allowing the big positions to get out with a big win.

I think the best run I've ever seen was ERS -- from 8 to 50 -- and now trades under 7. 'Value' is meaningless. This game is about your ability to ride a wave and not let it crash with you on it.

I have not done it all that well. I use fundamental criteria because despite the manipulations, the numbers do count for something. They can't short a stock like ELOS with $192 million in cash, growing 25% a year, earning 37 cents last q. down to zero.

The reason I bought ELOS in the first place was an article I read in NYTimes about these women in L.A. who spend around 10 to 30 GRAND a month on beauty enhancements -- face peels, tans, lipo, botox -- all that crap. These women don't care, they'd rather be pretty than rich and they get addicted. And there are tons of these baby boomers getting wrinkles. It's a slamdunk. These are all ladies who make big money / wealthy types and you don't accept looking ugly, even in a recession. Screw that.

I made a lot of money a long time ago by buying stuff nobody wanted and waiting. I can wait. I know I've got cheap stocks that are growing. The shorts only have the short term.


I guess the shorts learned a lesson today...

Unfortunately, my picks ELOS and ROCM are under a short attack and could not be a part of this wondrous rally.

Microcap index is up 1.5% -- leading the way -- so this is not even a bogus move.

NILE is the latest on my low-floater list to go skyhigh. Joining TNH (now a dog), GHM, FTK,
and DWSN. It's all about the manipulation, for good or bad.

You know, the more I see stocks move -- the more I think the market is quite a scam job -- especially for short term traders.

I am going to be focusing more on longer term plays because in the short term -- it's just a big screw job.

shorting at 2:15

Well, if I were short -- I'd hit the bid at 2:15 too -- make it seem like the world is falling apart because Ben didn't cut...

... even though that's what everyone expected anyway.

ROCM down...

which means more cheap ROCM for me...

ELOS down..

I'm running a few numbers

at $1.60 earnings -- growing at 25% for the next 5 years and 3% after that --- target is $48.

I'm not even going to mention the fact that over 25% of the market cap is cash.

Will it go to 48 soon? NO.

Will it stay at 24.50? I doubt it.


ELOS dropped close to the 20 day MA at 24.50 but like the QQQQs yesterday, they did not get underneath.

The inability to push under the MA suggests there is a lot more strength than appears I think. Currently up 20 cents on the trade so it what you want to see....

ELOS at 24.70

Entering a trade here.


ELOS is a screen stock -- meaning it meets many basic strong fundamental criteria.

But more importantly, the technicals show renewed strength after the latest ER. There may be some profit-taking here but with lots of cash and a new outlook, ELOS can run with a 10% short interest that had a good run.

Some basic DCF analysis gets targets anywhere from $33 - $39 as fair value now.

Fact is, buying it on the way down was like beating yourself on the head... you can only buy strength. That's what goes higher. ELOS has been a dog for so long, clearly some people will wait -- they won't be able to adjust to the fact that ELOS is possibly not a dog anymore. Then the shorts capitulate, the swing traders join in... and you've got a nice run.

But it all takes time. For now, the sellers continue to bail out of strength, assuming this is a brief moment of strength for ELOS that won't last long. We shall see.

Monday, August 6, 2007

microcaps tomorrow?

stocks like VSR, SDTH, NGA and SMTX have completed 'round-trips' and are now at key support levels...

The IWC microcap index has crashed over 10% recently...

Certainly the small traders deserve a bounce -- and got one today, the IWC had a nice white candle, long tail...

If there's follow through on the indexes I bet the microcaps get at least one decent day.

These are not stocks that anyone should be 'holding' -- you don't buy the stocks after the big pop -- loser game -- but always good if your timeframe is short and you pick your spots.

QQQQ bounce sign...

This might be a helpful sign when trying to bottomfish an index...

The QQQQs were down in the morning and approaching 47 -- a technical level of sorts. Obviously, once it breaks 47 there may likely be a lot of stops triggered, causing the market to freefall. However, buyers kicked in and the QQQQs only got as low as 47.03.

Now if shorts control a stock -- they'll always push it under that key level and cause the selling to escalate.

Here, though, once it became clear the QQQQs couldn't be pushed under 47... you could probably take a big position with a stop at 46.99 and assume the powers-that-be are there for you. And it turns out -- they were!

qqqq 50 day is 48.08
9 day is 48.23

I would expect to see some battles at these levels... if the bulls can push it through both -- they'll get a lot of short covering to keep the counter-trend rally going... but eventually those support levels might fail to support -- and then I would expect this narrow breadth, low volume burst to die violently.

But remember -- when a key support level doesn't fail on what should be a horrible day -- that might be a good sign to look for the Snapper.


Market is never in a straight line.

I think the up and down movement here is probably typical action. Fast action down... and now a counter-trend rally that will soon have the indexes backtesting the MAs where you'll discover if there's real support.

Since volume is light, new lows dwarf new highs by almost 10 to 1 and the A/D line is showing bad breadth (ha ha), I'm going to err on the side of caution.

But I would almost expect to see another fierce bull run (courtesy of short-covering) to work off the leveraged shorts who think you can just short a mortgage co. and expect it to drop 90% tomorrow.

The short side just got a little too crowded... briefly.

Look: I'm confused. I think everyone is confused. So when it doubt -- you sell out easily, you cover on the sudden volume surge. The technical signals fall apart after major supports are broken. Everyone's looking for clear signals and you don't get them when a bull market is turning into a bear.

In uncertain times, I would guess a lot of frustration will lead people to cash out. Low volume supports this idea. But low volume allows large traders to move markets, resulting in bigger volatility. We see that.

For full-time traders, the trick is learning when to sit on your hands.

Can you dig it?

Cramer Cries

This is being mentioned/posted by various bloggers / Yahoo posters.

I could only watch about a minute or so. Basically, he wants the Fed to bail out the Parasites because things are really "bad".

You know why things are bad?

Because the Fed bailed everyone out earlier.

If Ben cuts, they're gonna call him Cramer's bitch now.

I bet he stays strong tomorrow and the market does the old flipperooney.

I must say, this is the most entertaining market I've ever seen, even if you can't profit from it.

Just change your mind every day -- that seems to be what works.

+286 Dow

What the market taketh away, the PPT giveth back.

Dow +202

yet more decliners than advancers...

new lows dwarf new highs...

nice little short-buster rally.

It's all good again...

ROCM value:

I was running some basic numbers using a DCF calculator.

I get fair value around $28 - $35 / share.

Market popped but faded on today's news (because insiders were already in).

Bought more, and more... buy strength.

While the IBD crowd chases CRNT... I'll go for greener pastures.

ROCM - first news

ROCM announces a settlement today with one of the company's they are suing...

They received a large contract. Obviously, the insiders knew. That's why the strength was there. Considering the fact that the stock is STILL going up... I can only assume there's more news.

And there probably is. ROCM still needs to settle with the large company: Tyco (Covidian).

Once again, following strength pays off.

A thought:

Every trade seems like a GREAT idea at the time...

Another idea:

New traders think great traders are making money on 80 - 90% of their trades.

I doubt this is true.

Great traders do have one thing in common: They lose less on bad trades. As long as your losses are small, you can profit on 1 out of every 10 trades and still make a living. Think about it.

It's your ability to manage losses that sets the successful from the blowouts.

An idea I had...

It's not about the stock or its value.

It's not about whether you like the stock.

It's not about whether you think other people will buy the stock.

But it might be helpful to ask: Do you think other people will think other people will buy the stock?

If so, you might have something to work with.

Post on Mish's Analysis

good post (it's linked here)

bottomline: Rate cuts won't save the economy.

I agree.

Dow up 112 points right now.

One last dash of hope for the masses...

Might be a reaction to oil prices plummeting / OIH down big. Ah yes, gas will drop to $2.75/gallon. That should help support consumer spending...

sold ELOS

Out at 24.79 -- .50 cents or so.

It's now back to 25 but I decided this was not an investment -- not in this market.

ELOS has a classic gap up pattern... fades down to almost fill the gap and then staggers its way back up.

But once again, confirmation of the correct strategy to buy strength at all times... even if your timeframe is just a few minutes.

I wonder how many people are bottomfishing BTJ -- one of the most beloved stocks up until about 3 weeks ago. It hit 59.90 and is now at 36.90. Sounds like a bargain. However, buying former IBD stocks after their big run is rarely a winning game. This is how the Street distributes. The stock is run up as high as it can go, then the big funds can unload a ton on the way down.

I wouldn't be surprised to see the indexes fall away by the end of the day.

I bought more GLD for my own IRA today too. GLD and ROCM is my game right now. Following the modest strength.

ELOS at 24.27

I bought shares for Mom at 24.27. The stop loss is at 23.22 -- which would mean the gap up would be completely filled and ELOS would be trading lower than before the ER.

Indexes are mixed and ELOS might run enough for a short trade. In a strong market the shorts would have been blasted into outer space but it appears few traders are committed to entering the market. So this is a tough one to pull off.

I am buying into strength however, and it's really the shorts who are now fighting the tape today.

Volume is already over 800K shares. So someone is buying even if it's only short covering.

I think the end of the day will be more revealing which side has more strength.

Red again...

All the indices are down again...

And ROCM is up 25 cents.

I bought a little more. Buy strength.

Why is it going up? Not that important to me anymore. I used to want to understand. Usually you find out after the fact.

Keep what shows you profit, sell what shows you loss. Hope for more profits, fear for more losses -- as Livermore says.

still hoping...

I see a lot of Yahoo! posters still hoping for a bounce. Most of the older / more experienced bloggers however, have a more cautious view, based on statistics / observations that the overall markets are in a lot of trouble. A lot of people are in cash or getting into cash. But I think a lot of investors are still in there... and beginning to smell reality.

Smells kind of like a rotting carcass, doesn't it?


This is a stock I'm looking at today. It's a stock I would buy but the market is really saying don't do it. But I am tempted. They reported earnings today and the report was quite good -- ELOS is up 4.8% right now and based on their numbers... should be able to climb another 10 points... in a bull market.

This is my strategy and it's the only one that works after a year of trying everything else: You must buy strength. ELOS has been weak for months but this strong price gain on strong volume suggests a new sentiment.

However, all great traders made their money in bull markets and so even ELOS will face fierce resistance. But I would not be surprised if ELOS outperformed over the next 3 months. It's at $24.70 today.


I'm not really buying it...

I've got at least 200 symbols on my watchlists. I see about 10 that are green today. Internals stink. Fortunately ROCM is one of the green one's. Lovely.

I am adding more GLD to Mom's portfolio. Gold has to win. When it finally shoots... I expect the action to be fast and furious.

I need to browse the sites now and get a feel of the crowd. My guess is they are not buying the strength either.

Maine $treet

August 6: The beginning of the end? Will Ben save the markets by cutting? Or is the financial mess caused by derivatives too far gone to save?

I currently hold a position in ROCM since it seems to be ignoring the panic. The biggest beneficiary of the cutting will be gold. The $USD as we speak sits at final support before breaking to an all-time low. What can a dollar buy these days? Not much.