Bad news for sure! I think we have fallen enough from the highs to be in an official bear market now. 
The SPY, along with the S&P, confirmed a head ‘n shoulders pattern by breaking through the neckline.
Oh my!
Check out some of these other shenanigans: TSLA after being up $8 for the day, closes in the red; DNDN after closing about 4% in the red ($32.22) continued to dive after hours, trading at about $25; Oil is running down and BP is running up…What the $%@&*!
This evening, China PMI came in below expectations, so futures are in the toilet, at least for now. The bear is back! When a market opens higher and closes near or at the lows…THAT is classic bear market price action. 
Our one salvation is to see what the European reports come in like. I think I’ll go and by some firecrackers for the weekend. 
The day started off giddy with AAPL excitement, but soon tamed down and moved back and forth between red and green. All the indexes, except for the NYSE, closed barely green. After the close some bad reports from QCOM AMGN and EBAY sent futures moving to the downside…and they continue down thru the evening.
With the big up move in the Q’s thanks to AAPL, I thought I’d nibble on some puts, along with adding to my TZA position. The SPY looks like it may have formed a double-top over the past several days. Maybe tomorrow we see a confirmation of failed top. Also note that we continue to have increased volume only to the downside. 
Tomorrow we have Jobless Claims and lots of earnings reports. If neither of those have any good news, we may get real ugly. Here’s some more reading to cheer you up:
Greek Workers to Strike Today as Papandreou Faces Bond Rout
Do Bank of America’s Blowout Earnings Actually Blow?
See you tomorrow on the battlefield….or maybe I’ll just sleep-in. 
If you told me this morning that the Dow was going to end up 70+ points, I would have called you an ass. Turns out it was me…I mean the ass part. Unbelievable that the Dow made a 120 point u-turn! The S&P had a similar strange day. GS made a crazy u-turn also. The Russell had some semblance of sanity closing in the red.
The big trading volume was still on the downside, as was the advance/decline line and the A/D volume. The new 52-week highs today was way low for all indexes, turning both the 5-day and 10-day moving averages downward. So we had the lowest number of new highs and the highest number of new lows. Click on the chart to see it bigger.
I took profits from TZA and also the SPY puts I was still carrying. I’m still holding some TZA because I was expecting some more downside follow-thru! Again, the move up was uncalled for. 
This week and next are the busiest earnings reporting weeks and this week has a lot of biggies, IBM today, AAPL and GS tomorrow. IBM had a good report but sold off afterwards. As I had mentioned before, I think the good reports are priced in so either good or bad they selloff. Here’s more good news: U.S. Bankruptcies Spike 35% in One Month
The details are an even clearer warning sign that both the “bottom” in the U.S. housing market, and the “job growth” reported by the Bureau of Labor Propaganda are nothing but the “smoke and mirrors” of private sector shills, and/or government propagandists – dutifully reported by the mainstream media-parrots.
Gives you the warm and fuzzies, don’t it?
We’ve been looking for an excuse to correct this market and today we found one. If the market indicators weren’t on sell signals already, maybe the market wouldn’t have reacted to GS so badly. It’s not just banks that went down today. Either way, I suspect no more campaign contributions for this administration from GS. I’m also gonna venture that GS bought its own April puts ahead of the news and will report a stellar quarter next week. GS volume was 7 times above its average trading.
Other good news today: Unemployment rises in 24 states in March according to the Labor Dept. All the big earnings report companies sucked, but not as bad as GS’s surprise: GOOG BAC GE ISRG were all down big.
For the week the Dow ends up .19%, the S&P down .18%, NYSE down .57%, the Russell up 1.7% and Nasdaq Composite up 1.1%. So the high beta stocks are still doing okay, but the blue chips suffered. I expect next week to be down for the small caps.
Should Small Investors Jump Into Stocks?
And oh yes, the SPY puts, VIX calls and TZA did their jobs today!
This bullishness (or is that bullshitness) is making me sick. C’mon people, we are not in that great of shape. Did you see initial jobless claims ticked up along with continuing claims? Of course now that unemployment has been extended another year, there should be a lot more liquidity now available for the market! 
Both ISRG and GOOG had earnings reports this afternoon and are getting snipped afterhours. GOOG was down over $30 from the day’s highs while ISRG was down $13. I’m expecting QQQQ puts and SPY puts should work out well tomorrow….along with the GOOG puts of course. Futures are already moving to the downside….we’ll just have to see how far. BAC and GE report in the morning, so maybe that will be the frosting on this cake. Housing Starts and Consumer Sentiment get reported tomorrow as well.
Remember, it’s options expiration Friday….do you know your options? 
As Ozzy Osbourne sings, “Crazy, but that’s how it goes…. I’m living with something’ that just isn’t fair.” And boy was today a crazy train!
The top 5 active stocks represented 20% of the volume today. Four of those stocks are under 5 bucks, ABK C BPOP FNM. Only BAC was over five dollars. Not what you would call a healthy market. Pathetic volume to begin with and then 5 most active are government-welfare financial stocks! 
One trade I made today was to cash out some UNG calls for 38%. A nice take on a two-week hold. I also sold my SPY puts on that morning run down. I felt particularly good about that after the reversal and continuing grind up in the markets….crazy.
In case you haven’t heard, Recession is not over yet, says US panel.
And I find this disturbing: For Consumers, Time to Shop Until the Mortgage Drops. You’ve got to wonder how we have record consumer spending and record housing defaults.
INTC blew away its earnings and went nuclear after hours….which isn’t unusual for them. Actually that’s very predictable. And more often than not, it gaps up the next day and then reverses. So we’ll see.
Okay, we’ve reached the hump on OpEx week. Remember, after Monday and Tuesday even the calendar says W T F . . .
The day was not at all what I had been expecting….but it sure ended that way! A weak dollar overnight got things rolling. BBY earnings report juiced it, along with QCOM, and then the Jobless claims report was the icing. We gapped up above previous highs, sold off a bit, consolidated then rallied. All morning it was buy the dips. But the buy-on-the-dip crowd was slapped hard by the end of the day. I’m not complaining, but I totally don’t understand today’s action.
I did panic some and sold off some TZA calls for a small loss and some TZA stock for some small gains….ending at breakeven. I continued to hold the remainder and was rewarded by the end of the day. I’m still holding overbight along with VIX calls. I hope Friday morning is better than today.
And look at that uptick in volume in this 15-minute chart of the SPY. It just repeats what has been happening all month….up moves on low volume and down moves on higher volume. 
Advance/decline volume went from 4:1 positive down to -2:1 negative….that’s a wicked drop. The question now is this a precursor to something or just a late afternoon anomaly? This evening futures are down slightly from the close, but they were last night also. We’ll have to wait and see what Asia and Europe has going….and maybe Trichet from the ECB can say something stupid again.
So it’s Friday before a holiday week. We’ve got GDP and Consumer Sentiment reports…not much in earnings reports, although the ORCL report this evening may carry over into the morning putting a damper on the QQQQ. Trade well!
After a full bullish day on Tuesday, we had a half bearish day on Wednesday. Portugal on the ropes and new home sales blowing a little stinker, the bulls did not have a leg to stand on. There were many attempts by the bulls to buy on the dips, but today the bears prevailed, taking back half of what they gave the bulls yesterday.
I still have all the positions I had yesterday, although I cashed out some profits in QQQ puts and then got back in when the market went back up. That double top in the SPY did what it said it was going to do today….and I’m still looking for more downside travel….but in this market, you never know.
Asian markets are opening in the green, as are the futures. We are near the end of the month and the quarter….plus next week is a holiday shortened week. Tomorrow we get Initial Jobless Claims and also earnings reports from BBY and ORCL, among others. These markets have me on edge and I hope some sort of “normalcy” returns soon. In the mean time, my stock positions are getting smaller as my cash position gets larger.
Sometimes, entranced by the screens, watching equities, options and futures change colors, charts moving in a wave, and indicators pointing in every direction, I just have to scream....
