Methodical Destruction

You think the market is doing great, no? Guess again.

Up until recently, everything was cruising along just fine for tech. Then we were blessed with misses out of AKAM, NVDA, CTV, SYMC, X, just to name a few. Other names like MRVL, TEVA, NFLX, ERIC, WDC, STX, and a slew of gold stocks, have been picked off. Large cap names like GOOG, RIG, MT, BP, AA, BLK, MON, PBR, NOK, GILD, ADBE are all down more than 20% year to date.

So what’s working?

It’s a fucking chop-fest. It really is a mixed bag. Aside from the casinos, which are all up big, there is no definitive theme this year. Maybe cloud computing plays can be considered a “theme”; but that’s a fucking stretch. As cool as VMW and CRM are now; they are tomorrow’s lunch. Mark my words.

Care for a burrito led rally, via CMG? Pathetic.

CMI has been a big winner, as the trucking industry stabilizes. And WFMI has soared, likely due to the egregious spending habits of Mrs. Fly. But I cannot put my finger on any particular sector and say “I got to own it.” I have been in and out of 4g, Foreign and Commodity names. Heck, I even built indexes in The PPT to display my favorites. But, more often than not, staying too long in any basket of stocks has led to disappointment.

Chemical and Ag names are very volatile and 100% unpredictable. Every other week POT and MOS are swinging double digit losses or gains, while the chems boom and bust every month. Because of all of this, I’ve been pigeon holed into trading in and out, more than usual. My year to date gains are fantastic and I am in a good position to profit, in the event the market declines. But, what I really want to do, more than anything else, is pick a basket of names and buy them for months, without having to worry about 15% drops in the general indices.

Going into the final month of the summer, I am extremely apprehensive about the prospects of this market. I can see us sticking around these levels, inside of a 1-5% range. However, I cannot think of a scenario where this market survives the seasonal Fall “fuck you clown fucker, you’re dead” trading environment. All of the chickens will be coming home to roost soon. States need money and Republicans need seats. It’s not gonna be pretty and the consumer is floundering, as evidenced by the multiple contraction of many retailers.

Tomorrow is just another trading day. I will not put too much credence into the GDP numbers, mainly because it’s all bullshit. The name of the game is jobs. You can tell the jobs market is fucked up badly, simply by looking at the earnings of MWW: dreadful. And, let’s not forget, TLT is still hovering around $100 and the Yen goes up daily.

In short: get small or get raped.

You lose, Good Sir. Well played and I certainly do appreciate your zestful efforts. Howsoever, you lose.

Thanks for playing.

Good day

Now this is the type of market I can commit murder over. This is the type of “pinless hand grenade action” that pushes a man to throw everything a way, in favor of stabbing people in the face with jars of peanut butter. First we dive, then we rise. Now we just sort of sit on the flat-line, fucking with people’s brains. It’s moments like this that “The Fly” wished to dear God that he was a zombie. Instead of enduring this mouse-wheel, I’d be on Wall Street taking bites out of people skulls, right about now.

“Pardon me Miss, can I bother you for the time?” CRUNCH!!!!

For better or for a lot worse, I’ve been adding to my TZA position, as it trades lower. I’ve done nothing with VXX. I am done buying that. And, in light of this “gay as fuck” rally, I added to my GLW position. Essentially, one way or another, we all get split two for one by Mother Market. Some make it to an old age, like that Kerkorian fucker. But, rest assured. we all split two for one.

In short, GET IN THE MEAT GRINDER! We’re serving up tacos for supper.

Lots of stuff to look at here. First off, most of the upside ETF’s are OVERSOLD here. However, there is a certain waiting period involved for these trades to work out. It’s interesting to see oil, gold and the Euro ripping tits; but what about the Yen? WHY IS THE YEN RIPPING TITS?

Without a doubt, that is a big negative, in bold letters.

Treasuries are selling off and natty is up. Essentially, MOST of the ingredients for a rally are present, with a notable exception in retailers. Across the board, retailers are weak. I am not sure if it matters. People may ignore them and just go long, for fear of “missing out.”

All I know is this: we are supposed to trade lower. If I lose on my TZA and VXX positions, it was worth the risk. With my mammoth cash position, despite being tempted to go long, I am sitting on my hands in “do nothing” mode.

My largest long position is GLW.

Rolled in around $32.38.

UPDATED: Added at $32.20

Booked a small gain. This fucker is too bogged down.

Onto the next one.

Developing…

For centuries, stupid men with big fucking beards have been trying to debate the inalienable truths of mathematics. They’d gather near the fireside and argue against 2+2 or 3×1, until someone got tossed into the fucking fire. Fast forward 10,000 years and people are still getting tossed into lit fireplaces, over tedious squabbles, regarding the basic fundamental laws of mathematics.

The fact of the matter is: the sell off ensuing in the market is young. You might be tempted to jump in there, with grandiose hopes of “doing something special”; but you’re only going to end up embarrassing yourself or WORSE: end up on the receiving end of a fucking lit fireplace.

Ladies and plebs, do not fight The PPT, for it is a space aged time machine, while your charts are nothing more than localized graffiti. Frankly, if I was a police officer, I’d arrest many of you chart fuckers for vandalism, because that’s exactly what you are doing and it’s a motherfucking crime!

In closing, I am not trying to make a killing on the decline, sans my personal trading accounts. I am here, mind you, to see you deposited into lit fireplaces then, ever so gingerly, buy out your egregious margin liquidations.

It’s important to acknowledge what is moving the indices everyday. The biggest companies, by market cap, is where the big money hides. Using a simple screen in The PPT, cross referencing companies with market caps over 10 billion and ranked highest by technicals— using our algorithms— here is your current leadership.

HDB
LVS
GENZ
SAN
FIS
AZN
UBS
FMS
CMCSA
PX
HIT
BBD

NOTE: Cajun is gifting away 12631 t-shirts. But there’s a catch.

Much to my surprise, the bulls kept it together today, despite all of the ingredients present for a most horrendous decline. Everything resets tomorrow, except for the inevitable pullback in Asia tonight, led by the Samurais in Japan, thanks to strong Yen. CAT and XOM kept the ball rolling today, effectively knee-capping all beartarded attempts to bring the big index lower. Nevertheless, it looks like I will close with marginal gains in both VXX and EDZ, for the day.

One this is clear to me: you cannot have the Yen and Treasuries up here and expect the market to rally. Life doesn’t work like that.

While it’s true, the CDS market has improved a great deal over the last two weeks. It’s also true that the CDS market is now littered with fucking morons who think they are going to hit “Bear Sterns lotto” or some shit. I do not think the market will crash, nor will we see grandiose failures. I’m just looking for a pullback.

Bottom line: If we are setting up for a 10% move in the market, what do you think is more likely, 9,000 or 12,000 Dow?

The time for games ended yesterday. With this post, I hereby put you on notice: the “black flag of absolute death” (not that half measure shit) is coming your way. Run now, else, ummm, receive the black flag.

That is all.