What to Expect From the Markets in October

Last year we went up 10.9% in October, following a tough summer. Over the past several months, the S&P has plodded along, almost methodically, 1-2.5% higher every month without volatility. The theme for 2012, thus far, has been “volatility compression.” Central banks have succeeded in succoring the insecurities of equity investors through grift. Because of the nature of this unbelievable melt up, many are waiting for the hammer to drop, wishcasting for it to be blunt.

On paper, October is the second best trading month of the year, second only to April, sporting a 68% win rate for the S&P. While it’s true, the month of October is most readily known for its flamboyantly gay market crashes and subsequent Louis Rukeyser specials. It’s also fact that the true nature of the market for the month of October is of supreme bullishness.

Based upon seasonality, which happens to be a fond novelty hobby of mine, certain stocks stand out in the month of October, such as FFIV, GPS, MAKO, even ERX. There is a full report inside of The PPT, for those who are interested. We have a working seasonality engine there for your most hedonistic desires.

In short, the market looks and smells like shit. But we have winds behind our sails, courtesy of the Fed, ECB and the seemingly never-ending walk higher–which has devastated purveyors of VXX.

To me, this market is like the city of Detroit: fucking useless, better suited for toxic chemicals–a wasteland.

All of my smarts and know-how have meant nothing over the past two weeks. I drifted higher today, but not due to any ingenious move on my behalf. I was in meetings all day and had to run some personal errands. Had I been at the desk, I would have sold it all, then bought it back, then sold it again.

FUCKING SPASTIC IDIOT.

Through indecision and confusion, I found clarity. My thoughts don’t matter. The outcome has to be the same, like QE1 and exactly like QE2. All I need to do is be patient and willing to lose everything. If I am not willing to lose it all, I should not be invested.

Pussies never get the hot chicks. It’s always the person who is willing to be rejected, almost clamoring it, who is going to capture her (no caveman). The same goes for the stock market. If you have a good enough mind to pick some decent stocks and gain an advantage over your competitors, coupled with the willingness to lose big, you will be successful. I guarantee that.

The problem that most people have, however, is delusions of grandeur. Most men won’t know when they are used up, useless for picking stocks. We all go through peaks and valleys; but some men enter the valley and never come back.

My advice to those who have lost your mojo is simple: stop trading you fucking degenerate pig-bastards.

The market turned on a dime again and all of my stocks are green. I’ve decided, as a matter of principle and clarity, to get my G Bush on and stay the course.

I will never dip below 90% invested again, for as long as I live. The world can blow up inside of a black hole — and yet I’d still buy stocks from my moon base.

I hope all of you shorts get your faces eaten off by
bath salted zombies. I feel a certain energy entering my life force again– something that has been absent for months.

I am back to my pirated lifestyle, black flagging on you fucking homos. Check this out: I am going to make money whether I like it or not–blogging this shit from the absurdity of my iPhone.

I’m staying long during good times, even longer during times of arch fiend duress.

This rally is fucking bullshit. My stocks have all reversed and are sucking dick!! I don’t like this fucking market at all and would sell everything, if not for the fact that I’m stuck someplace with limited bandwidth.

All of the Nasdaq gains are gone. There is nothing redeeming about this market and it will go decidedly lower and soon. I am convinced of that.

To endure this fucking horseshit, seeing the market vomit up a massive morning melt up, is fucking impossible to deal with. I am inflexibly livid.

ChessnWine was as cool as a cucumber during last week’s decline, further proof that he is worthwhile of your attention and investment in his premium products. Apparently, the economy is doing better than expected. As such, stocks are ripping to the upside. Only thanks to my stubbornness to self inflict financial wounds am I benefitting from today’s gorilla run. Had I listened to my urinal shadows, I wouldn’t be +1.6% right now.

Nevertheless, it appears the somber days of last week have ended. Once again, the Cocaine Gorilla Raping Train to Hedonism is running at full speed, fucking everyone in its way!

As for me, I have several meetings today, pertaining to matters of compliance. I intend to hold everything and enjoy the fruits of my lamenting, vis a vie higher equity prices.

If I look at a section of a wall that isn’t painted correctly, or an edge of travertine that wasn’t quite lined up right, I obsess over it until it is corrected. Small things transcend every facet of my life, from portfolio allocation, to wording of an email that must convey a certain message, to this blog– and most intently on The PPT (ask Vincenzo Illuminati), especially the new version in BETA.

I am trying to understand this market, post QE3. We’re not trading healthy and the important QE3 sectors are getting hit the hardest. The only logical deduction is the weak hands are being flushed out–the fucktards who went long AFTER QE3 was announced. Another thing that is beginning to bother me is the middle east. Tensions have never been higher and Israel is running out of time.

In the real world, away from QE and insane budget deficits, things aren’t so peachy. You can wake up one morning to reports of Israeli jets bombing the adobe out of Tehran, with S&P futures down 50. There are significant global risks to stability that cannot be ignored when investing today.

I’ve never had a lot of luck in October. It’s one of those months that tricks me, one way or another. My best months are from January to May, consistently, for more than 15 years in the business.

Plainly, I am going to cut losses on a multitude of my positions and not reinvest the proceeds– should markets continue lower this week. I’ll make it up later, when I have a better grasp on the direction.

Based upon the laws of mathematics, of the sublime nature, the market is not going to bounce until we hit certain levels. I will reveal to you what is seen on a daily basis inside of the hallowed grounds of The PPT, as a gesture of kindness.

As you can see, the algo marked the top of the range and hasn’t flagged OVERSOLD (OS) yet.

There are levels of OS we are prepared to buy. I am eying the 6 month OVERSOLD range as a possible buy point for the rest of my cash.

As you can see, this level has not failed dip buyers at all, over the past 6 months. After that, I will fall back on the 12 month and 36 month algos, all sublime in nature, touting accuracy stats greater than 76% with a much larger data set.

If you’re wondering why I haven’t adhered to my own computer brain by going to cash when the algo said we were OB, the answer is simple: gluttony.

Punishment for my crime is loss of time. Making back the money is the easy part for me. I do this, quite successfully, for a living. I’ve never been faced with a problem that couldn’t be solved. It’s the puzzle that keeps me interested. However, it’s the loss of time that I lament the most.

Until then, SHOMP on.

I tried to keep the Asshat of the Week Award  (AOWA) dormant, in order to preserve the institution. However,  this fucking interview with the RIMM CEO.

Becky Quick, long term interviewer of the old crusty one, Warren Buffett, could not have done a worse job with the prick from RIMM. I want you to appreciate the fact that RIMM lost the smartphone wars because their management was incompetent. Stubbornly, they stuck with the stupid physical keyboard, instead of the iPhone touch screen technology that Samsung stole. The result: RIMM is heading for the trash heap of once great companies gone bad, joining the likes of NOK, EK and AMD.

THEY FUCKING DESTROYED THE ENTIRE COMPANY!

Instead of pressing the CEO of RIMM, Becky decided to praise the virtues of the physical keyboard. Really? It’s equal to interviewing the CEO of betamax, circa 1993, and telling him how awesome it was compared to VHS. It’s like praising the rotary phone versus digital, incandescent lights over LED, big ass tube(d) teevee over LCD LED, beeper over cell phone, Burger King over Five Guys, Lycos over Google, Shoprite over Whole Foods.

Very pretty, but ASSHAT!!!

Similar to empty threats from Israel to Iran, I too endeavor to attack the market with sell orders if we continue lower. Generally speaking, I look at the -10% level to either man up or back down. Several of my positions are near the -10% line and will be dealt with accordingly, should this market continue to lose good people money.

The market is not going to rally today. Try to avoid getting lured in and always avoid them murderholes.

Our only hope for an upside reversal is stimulus by the Chinese on sunday night.

I knew this shit was going to fall apart. It’s all bullshit; can’t you see that by now? The days of perpetual cocaine runs are over. This new version of POMO is different. It is luring bears into a false sense of security, in order to execute them later. By that time, most of you will be bankrupted.

I am down more than 1% this morning, giving back half of yesterday’s gains. This being the final day of the quarter, everyone figured we’d melt up. I knew we’d melt lower; but have opted to endure the pain and agony of capital losses, as a form of punishment, for committing the heinous act of gluttony.

Nevertheless, this is not a market fit to sell short. There is overt central bank manipulation. How do you expect to survive in shorts when there is so much widespread corruption? You cannot.

Over the weekend, expect China to introduce stimulus, which may pave the way for another round of short squeezes next week. Eventually, we are going much higher. But for now, we need to clear out the Qe3 buyers.