So, almost every stock and commodity was lower on this bright Monday morning. But as par for the course, at 9:40am on the dot, buy programs began to run and within an hour (a long time nowadays) markets turned positive.
And so, again, all bad news is known and discounted, including skyrocketing gas and commodity prices. All selling dried up within a few minutes to be replaced with outright index buying and screens went from red to green, just like that.
You didn’t expect the tone and tenor of the market to change today, with just three days until the end of the month, did you? I didn’t think so….
You continue to be trained that Central Banks are bigger than any market because they now are. You are also being trained to never sell or stop because it always comes back. Over and over again the markets refuse to allow any selling so you simply view any selling as time to take a few minutes off or a time to buy the dip, even if it is just a few points. Of course your training will eventually betray you when you ignore the eventual real selling, but I digress.
This training is a carbon copy repeat of last year and the year before during this first quarter of the year. In each of those previous two years the markets moved higher in an uninterrupted fashion without so much as a 1% pullback, just like this year. The similarities are twofold, first the perception (however shortlived and illusory) of a recovering economy and massive money printing from Central Banks. Over the past two years there was a specific end to the domestic QE but it seems that the Euro-printingfest may be open-ended.
So let me go out on a limb and say like the past two years, the markets will levitate just long enough for you to allocate your 401k/IRA into the stock market. By that time, the DOW will be closer to 14k than 13k. And because after all, the odd-lotter (you, of course) must buy at the top of a multi-year range and become a “long-term investor”. It just wouldn’t be American if it were any other way!
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that last sentence reminds me of “cramer” back in early “07” telling everyone to buy and hold,then 6 months later,everyone and their brother was crying buy and hold is dead. “holding the bag”,in a forming top.
Why are we all being trained and who is doing it? Are we brainwashed?
Because in our world, consumer and business confidence, spending and hiring is DIRECTLY CORRELATED to the near-term direction of the stock market. NOTHING is more important, period. Do I make position clear?
Election 2012.
Are you incorporating election year market performance into your analysis?
_____
Remember 2008? An election year? 2012 will be similar IMHO
That was different. They wanted to switch teams that year.
______
Who is “they?”
“Why are we all being trained and who is doing it? Are we brainwashed?”
trained doesn’t require being brainwashed, it’s called learning.
A reward system such as operant conditioning is something that works since humans tend to avoid pain and seek pleasure. If every time we do something, we get a desirable result, we will tend to continue doing that something.
The mind works primarily by association. We associate things together and form “neural nets” a network of neural pathaways in the mind that connect. It’s why we can just so much as look at something and feel differently, or hear a certain sound and react a certain way emotionally. You don’t need to be in any kind of a trance to perceive a different reality, you have blind spots in your eyes as well as your mind.
As a human we are responsive, we feel empathy generally, you can play sad music at a movie when some scene that is emotional is happening and you will generally respond to it and feel sad even though you know it is not real and has no bearing on your life. It is just how the brain works.
Training, learning, brainwashing; neural pathways, operant conditioning, neural nets, trance perceived different reality… Who’s doing it and why? Is it a cabal or an accident?
fun,fun fun. i gased up the yacht. layed in a supply of dried food, and bacardi. im good. but i do think we go higher because of election year, and mucho money printing by the fed. so until i see da mushroom cloud . im playin with fire.
http://tinyurl.com/6vvx8k2
This is STILL the best bearish chart in the market. SPY:Vix ratio. 3 year wide head and shoulders.
And yet, fund managers will call their clients, tearfully, and say
“no one could have seen this coming!”
Yes, we could somehow make it to april, chugging sideways. But , the convergence of SPX and Vix patterns suggests a “flash crash” type move at any moment now.
A very bold call, good sir. All you need is volume to the downside and Bernanke’s minions to take a day off…
So, what is your game plan now ? Being cash or still riding longs? I remember you made right call last year, so I am curious. Thank you.
Sorry above Q is for Mr. Panamaorange.
You can look at something like SDS calls dated out to june and september . They are quite liquid.
Ive been accumulating some spring calls in SPXU and TZA .
There are dozens of ways to short . It all depends on what vehicle you are using, and your timeframe. Honestly, safest thing to do is wait for the break, then try to bounce on the dead cat bounces ( intraday short) . It may take some patience.
sigh
meant to say “pounce” on the dead cat bounces , by shorting them
Thanks !
right shoulder not complete yet, is it?