CRUSHECTOMY

So, we are back to a 2 way market. These past day’s are certainly proof of that. But moves in either direction become exacerbated by our friends, the momentum HFT traders. Plus, today, all NYSE quotes are suspect. But there is no doubt that there is hot money leaving the market.

The markets have lived on government largess. Now, payback will be a bitch. This is the reason that this has been one of the most hated rallies in the history of markets. Because it was “engineered”, bought and paid for with newly created money, courtesy of Uncle Ben and Aunt Timmy.

So, for now, let the market release the one-way (bullish) trader-types and establish the new low area for our new, and possible extended, trading range. Many stocks are in the process of testing their primary breakouts. This is the first area of support. There may be some overshoot, but don’t expect much worse here. Much of the near-term damage has already been done and we will go through a period of hammering out the recent lows before bottoming and bouncing for real.

Our GS long trade remains as $149 is a good entry. Everyone was expecting the Prez to finger them as responsible for the world’s maladies and the earthquake in Haiti. But since they were not, then this remains a good entry. BUT keep your stop tight at 147.

Our CENX long  is fairing worse as metals are getting crushed across the board. Super-near-term traders should stop on this break of 12, down something less than 5%. But I plan on doubling up near 11.

Our EBAY short was done above 24 and that is working its way towards testing the 20 area.