There’s blood in the water, LET’S GO KILL SOMEONE!

Too much drama for me.

Prediction for the rest of the year:

1. SPX drops, resetting the weekly MACD.
2. QE3 is announced, the market rallies to new highs.
3. The USD is destroyed to the point that it brings down the economy/shatters investor confidence.
4. Global depression/sovereign defaults just in time for the end of the world in 2012.

BONUS: A FBOOK IPO and crash would be the cherry on top.

If GS, MS or JPM (I’m not picky) need any fund managers, you can find me by e-mail. I only work for 6 figures.

go2jupiter at yahoo dot com

I sometimes flip the charts upside down to get a different perspective. Don’t laugh, it works.

Bellwether stocks:

Misc:

The market is going to go after each of the PIIGS one by one.
For the longest time, Venezuela was below Greece. Portugal has now moved into the cross hairs.

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Nasdaq futures are breaking down this morning while S&P futures are hanging on to support.

I hold TVIX so this makes me happy, but I lack conviction.

Update: Looks like this sell-off might be the real deal. I added support levels on the Nasdaq.

I haven’t been scanning for longs but below are 2 clean setups that I’ve noticed.

Note: ABAT is a stock that I bought “ages” ago. It has a dangerous background that you probably shouldn’t touch unless you know what you are doing.

Both of these setups are similar where the stock runs up, pulls back lightly then accumulated on volume.

If you try to imagine a next day scenario, you can see that any up day will create a swing or a “vacuum” for higher prices.

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I bought TVIX in the high $17’s
More on this later as well as fun with options.

Update: I won’t lie. I took a stab in the dark here.
Currencies and bonds, which I use as indicators, are a mess.

If it feels like I am being arrogant when I don’t post what I am thinking, its not intentional.

I am busy getting drunk buying stocks during market hours and you wouldn’t expect Michelangelo to teach you how to be an artist. Some of this is just instinct.

The way I see it, if we continue to trade in this range (SPX 1370-1270), at current levels, there is more room for downside than upside.

I will use July 22nds close as my stop with July 7ths as a last resort.

Regarding options: I know enough about options to know that I don’t know enough about options.

Its been in the back of my mind lately that trading every day is unnecessary.

(I should be clear and say that watching the market everyday is what made me good, but now I want to move on to bigger and better things)

If I could just nail some out of the money index options at intermediate inflection points, I could retire and sit on a beach sipping colourful drinks with umbrellas inside of them. (at 26 years old)

Options are tricky because if you take the same underlying and the same day and put it into a parallel universe, the price of those options can be different.

Unless there is a clear edge in trading the volatility of a certain stock (another topic), I usually stick with index options as they are more reliable.

So today I opened a bunch of paper option trades.

I bought puts and sold calls for the Sept 11 expiration (I was going to go out to Sept 30 due to bad luck but I don’t intend on holding these until expiration anyway)

I used tradeMonster’s free trading platform that I signed up for via CBOE.
It has a bunch of cool tools, it looks clean and classy as well. Btw its web based so there is no download.

The goal is to do this until I know how different strikes react in different conditions, like the back of my hand.

Fuck what you read in textbooks and say what you want about paper trading, nothing beats real world experience.

I will never forget the first time I tried to buy an option at market price and found myself down over 20% as soon as it got filled.

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Just kidding. But speaking of death, lets take a look at an old iBankCoin play which could use some life.

Shares of GLW, the maker of “Gorilla Glass”; a high strength glass used to protect electronic devices, have dropped around 30% from their year to date highs.

This might be attributed to lower global LCD sales and for not supplying the glass to new AAPL products.

Looking at the chart plus some quick fundamentals, I am interested in buying GLW.

Why? It seems like a low key way to get a piece of the Samsung Galaxy S2 smart phone and tablet sales, both which run Google’s Android platform.

The smart phone is key here. It was released worldwide in May 2011.

During the first 60 days of the phones release, Samsung reported selling 3 million units.
Those figures are almost a month old and the smart phone is just being released in North America now. (July/Canada – August/USA)

Some analysts expect the phone to become Samsung’s best-ever model with potential sales of 20 million units this year.

All of the reviews and talk on the net that I have found confirm that this phone is “crazy”.
Dare I say, no it definitely is, eating AAPL’s lunch.

Samsung isn’t the only brand using this glass, but these sales don’t appear to be priced in yet.

GLW earnings report is scheduled for 7/27/2011.
I’m not sure if profit from these sales will be included, but the chart shows some investors are showing interest.

For less risk, it would be better to wait until after earnings. This also fits with my belief that tech and energy will outperform in the 2nd half.

Note: I looked at the insides of a Samsung Galaxy S2 smart phone and the only hardware manufacturer that I could identify was RFMD. (wi-fi and power management?)
ATML produces the touchscreen controller for both previous versions but I couldn’t verify it for these newest models.

Thoughts, comments, criticism are welcome.

Disclaimer: If you buy GLW because of this post, wild Romanian goats will eat your harvest. And, you may lose money.

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After today’s rally, I am sitting here with a watch list of stocks to buy that was empty just the day before.

I know when I was learning most of what I know, (I still am daily) it wasn’t following others into trades that helped me most, it was looking back at a pattern so I could identify it the next time it happened.

So let’s go over GSV Capital Corp (GSVC)

(side note: I am impressed by this companies website. It looks clean, professional and to the point. Something that you would expect for such an investment company, but I might be easily amused.)

Anyway, I assume if you are in GSVC, you are not a “dividend” type investor. Down moves like today are generally something you would like to side step.

Below I’ve highlighted some signs the stock gave off letting us know that something was not right and a chance where share holders had to get out before the intraday collapse.

Next is the daily chart. If this stock is the real deal, its future could look something like this and still look like a legit momo stock.

When planning entries, I like to try and envision what will happen tomorrow. After looking at thousands of charts, you get a sense of what is likely and what isn’t.

A test of the lows or a lower low to establish a bottom is something that I could see happening in the next few days.

So is technical analysis infallible?

Of course not, as we can see in the last chart, there were times in the past month where weak hands would of got shaken out early.

However, that was pretty much a textbook breakdown and if you learn to catch the unmistakable and “ominous” presence of a stock when it starts to flag after a drop, you might be able to save yourself some coin.

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Following a record rally, the market has turned schizophrenic and is on track to give back those gains almost as quick.

My clue to exit longs was when the SPX broke daily support last week and continued to make lower highs on the 60 minute chart.

Its like 400 degrees outside and there is no way I am sitting here, day trading shorts while dressed in burlap + velcro sneakers (common bear attire).

There are pockets of stocks that are outperforming, but I am not interested in buying anything until I see some sort of base form on the SPX.

The good thing about trading breakouts (to new highs or out of bases) is that either they are there or they aren’t. If you know what I mean.

Which also helps me not hold onto losing stocks like an idiot.

If we trade above today’s SPX high of 1,315; a hammer / swing low will be in place. Otherwise I still expect the MACD to go to 0 before the next leg up.

(shake out on debt news, break out on QE3 news)

This correction should be quick enough for me not to bother with shorts and I am not interested in joining the bear circle jerk (TVIX) at these levels.

Instead I am going to chase skirts, eat ice cream (low fat) and work on my tan.

“More on this later.”

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