Late Night Thought

My feeling is this, the market can trade higher here, but there is always a risk of another Lehman Brothers overseas. Now that they are banning short selling on certain financial instruments overseas, it seems they are using a page from our playbook, a page right before shit hit the fan.

Can you imagine a Lehman Brothers event overseas? What if news hit the tape and we sliced right through the 200 day moving average in the S&P 500 (a level EVERYONE is watching) ?

Can you imagine the ‘stops’ that will be taken out once the 200 day is breached? You think the fat finger trade was scary a few weeks ago? Wait ’till they SHUT DOWN the market due to more egregious computer algorithm trades.

Then, wait ’till they ring the opening bell the following trading session. THERE WILL BE BLOOD.

As long as the Euro can hold this line, the bulls have a chance to run with it here. It’s as easy as 123:

The above chart coupled with the chart I posted in the previous post, is why I decided to deploy some capital to the long side near the bell today (all trades noted in the user note section of The PPT).

I am short to long term bearish here, but believe a bounce is near. I will continue to watch the Euro, oil, The PPT hybrid score, and the XLF for clues on market direction.

ChessNwine pretty much summed up everything you need to know in his latest post, give it a look if you have yet to do so.

Don’t forget to visit the New iBC store to get the latest gear, indeud.

I posted this chart a few weeks ago, highlighting 1,100, which I thought was a safe bet for a bounce. Well, we got that pullback & bounce this morning, and I took off half my position in [[TZA]] , a bit early I might add, but walked away with a nice gain. I plan to keep the other half for a few days, just in case we decide to dip below the 200 day MA.

At this point I am  a little more interested in longs than shorts, but not quite ready to deploy capital. Here are a few names I’m looking at: ATPG, CCME, EBAY, RFMD, S, SWHC, YGE, & YHOO.

I will continue to watch oil and the Euro for clues on market direction. I really want to see oil trade higher for me to really get bullish. In my opinion, there is no reason why it should continue to trade lower other than the fact we are not done yet done with this correction. I think Mr. Cain would agree.

Off to eat a sandwich.

As I make it back home from my trip from Florida, I pull up my thinkorswim platform and type in /6E. This is the symbol for Euro futures for those wondering how to watch the Euro other than [[FXE]] , and if you notice, 1.23 support has been breached yet again.

This is the only thing you really need to watch for market direction as it is leading the markets. I am still short the market via [[TZA]] , but will also look for longs upon further weakness. One thing I am watching at the moment is [[UNG]] , the chart really looks like it is putting in a bottom, and I am close to adding to my position in SandRidge Energy Inc. [[SD]] .

I need to get settled in, so I will be back later with some more scans. For now, long live [[TZA]] , and the death of the Euro.

As many of you know I took some time off to visit Mr. R.W. in Florida. Despite being on a small, much needed vacation, I felt it necessary to give you guys an update on the current market.

Here is a chart I posted earlier in The PPT:

As you see we could bounce around these levels as we are near trendline support, however I’m not betting on it. The close will be important today, if we continue to slide here and close near the lows, you can almost bet that we are headed to the 200 day. Which is why I made [[TZA]] my largest position earlier today. I still have long exposure, however I am trying to stay delta neutral (balanced) in this time of uncertainty.

Names I like and will buy (more) on a further dip: ETFC, YHOO, CCME,  AONE, YGE, S, & EBAY –(will be new position).

Back to the beach…

I bought NutriSystem Inc. [[NTRI]] at the open, looks good above $23: