I have passed the first two examinations for Chartered Market Technician, and tomorrow is my third and final examination. It is, I'm told, the hardest, and a lot of very smart co-workers have flunked it, so I'm pretty nervous.

I will say one thing about this week's action, and it is expressed in the candlestick chart shown below. If you've ever wondered what an ideal hanging man pattern looks like, you have your example right here in real time.

I'm going to "go dark" until Saturday evening, which means hundreds of comments will accumulate in this content-free post. Sorry about that, but I've really got to hit the books (a photo of my required reading is shown below). This will also give me some time to shake off the insanity of this week and process what's been going on in the market. Thanks.

Well, I think it's pretty evident that bears don't have a chance in this market. Just as the bears completely controlled things back in the marvelous autumn of 2008, the bulls are totally in control now.

Even when the US Government – the most Pollyanna entity of all – states that their view of the economy is grimmer than expected, the dip in the market lasted only a few moments. I am glad that I've sworn off FAZ and SRS. The spike in FAZ last ten – count 'em! – ten minutes. So a whole other slew of traders lost cash on that in a big hurry.

I usually have a variety of "core" positions (six figures), but I have none of those now, since I've really cut my risk down. With the exception of Monday, this week has pretty much stunk up the place. My goal right now is to keep risk low and preserve capital, since this is a market that cannot be trusted for the forseeable future.

I got an email today from a person wondering if technical analysis was a self-fulfilling prophecy. In other words, if everyone is following the same chart, won't the action of the market simply be dictated by people taking action based on the same lines, indicators, and levels?

This is a question I've heard before, and my response is something along the lines of the Drake equation. Specifically:

P=Number of participants in the equities markets

A=Percentage of participants with an awareness of technical analysis

K=Portion of those aware of technical analysis that have accumulated a knowledge of it

E=Proportion of knowledgeable technicians whom effectively apply its methods

Thus, P x A x K x E=probably about 7 people, and that includes you.

Seriously, though, my belief is that the quantity of those people who use technical analysis effectively in their own trading represent a very, very small amount of the collective buying power in the market (let's call it 1%, and I'm probably being kind), so I think the notion of TA being a self-fulfilling prophecy is incorrect.

During times like this, it's important to think back to former high-fliers like POT and MOS. Remember those? There was a time that fertilizer stocks (of all things) were the hottest game in town.

You can click on the "Present" bar to see how things have changed.

My point is that as we're witnessing insanity in stocks like AZO, CAKE, DRI, EAT, and all the rest of them, all these momentum plays eventually meet their doom. The hard part, of course, is knowing when that doom arrives! Because a stock that has moved from $3 to $30 may seem ridiculous, but it could be just as ridiculous as $300 before it has topped out. Tilting at windmills can get extremely expensive.

There are enough patterns with safe, clear stops to provide opportunities for shorting. The past seven weeks have been very, very rough for the bears. There are a handful of stocks I still like on the long side, but on the whole each lunge higher is just making me more skeptical about the market's ability to hold itself up.

You know people are reaching for straws when they are bidding up shares of Ford (F). I'm shorting this today (I've never traded Ford in either direction in my life………..) with a stop at 5.49