Well, besides having a government that the world doesn't respect very much, now we have something else in common with Pakistan – – – – the need for the government to outlaw short-selling in order to protect the whiny, childish, needful bulls. Allow me to point it out on the front page today:
Now just think about this for a minute. Can you imagine a creation of a downtick rule which demands that a person can't buy a stock unless it moves down in price? Or can you imagine the government forbidding going long a momentum stock, simply because it just seems to keep going higher and higher?
Of course you can't. And the reason you can't is because the bulls need mommy and daddy (the government) to wet-nurse them when things aren't going their way. Bulls have all the advantages, including a corrupt government on their side. So when things don't go their way, they whine and pout until chrome domes Paulson and Bernanke come to the rescue.
You might think I'm upset because the Dow was up 270 points today. On the contrary! Those of you who listened to my video heard me loud and clear calling for a major bounce higher. I said I had never been more confident of a bounce being in store. So I am delighted, thrilled, pleased, and contented that the surge happened. Terrific! It just creates more shorting opportunities! Added to which, my patented $SLIX indicator – the traffic on this site – flashed a clear "buy!" signal yesterday:
A lot of this was driven by an explosive rally in banks. Wells Fargo was up nearly one-third. Wells Fargo! This is a old, staid bank! And it moved higher on enormous volume, too. Long term, it's clear the financial system is heading for disaster. I don't think we've seen anything yet. These countertrend rallies are all just part of the unfolding collapse.
I did three main things with my trading today:
- Took about 40% of my positions off the table with respect to energy (lightening positions, taking profits)
- Took some profits early in the day on a handful of issues (and a loss – much more modest than I expected! – on takeover target ANR)
- Very late in the day, re-entered a few positions, although the vast majority of my "hit list" is waiting in the wings, probably for tomorrow
I think the Dow has a decent amount of resistance at about the 11,430 level, shown below.
Sorry to bore you with another $UTIL graph, but this pattern just keeps getting more and more likely. It points to explosively higher interest rates, from what I can interpret.
I lightened up quite a bit on energy shorts today, with terrific profits. I think we're in for a bit of a breather here.
Modest resistance for the S&P is at 1,270. It becomes much firmer at 1,315.
I took half my profits on ICE yesterday and the other half today. I've drawn two necklines, and time will tell which is the real one. Obviously I am going to gobble up puts like a pig if it gets to the 110-115 area.
I did re-enter one put today (having taking profits on it just yesterday!) – Blackstone Group. I'm cheating just a little bit on this neckline. I hope my flexibility isn't punished.
STT was a firm retracement today. I'm ready to re-enter my short.
I've already short Textron. This looks like a very predictable pullback. Sweet.
Another "STT-like" retracement is BLK.
I'm going to re-enter SCHW short, provided it doesn't push higher than the right shoulder.
This is a so-so graph. Not bad for a short. Meh.
OK, that's it. I've been charting since before the sun came up. Enough! Bulls, thanks for the rally. Feel free to tack on some more. I'm waiting for you.
