The Russell was down but the Nasdaq was up. The Dow was up but the NYSE was down….and the S&P was just a little below breakeven for the day. Not sure what kept this market up today, but it sure as hell wasn’t anything logical.
Tomorrow is OpEx so trading may be a little crazy. I try not to do much trading because things can move quickly in either direction. My inclination though is to continue adding positions in anticipation of a correction next week. I’ve been nibbling on TZA, both the stock and its calls, and VIX calls. TZA is green and VIX is red. I’ll wait until Monday to decide on some stops.
There’s a couple stocks I looked at that show some incinations to move up: ZANE SHIP QYM HLIT. I’ll put thise on my action list for Friday, but it will take a lot to make me play.
Here’s some interesting reading:
What the VIX Really Tells Us
Is China actually bankrupt?
Break Your Trading Routine.
As Keynes famously once said “The market can stay irrational longer than you can stay solvent”. Be careful out there.
Published on
January 22, 2010,
3:33 pm in
Trading.
Tags: ES, VIX.
With governments throwing a lot of bad feelings towards Wall Street, fear and uncertainty came alive. Did you see that VIX move today…23% just today…20% yesterday on top of 6% on Wednesday. And we haven’t seen the indexes move like this since last February….3 down days in a row…triple digits in the Dow for all three days!
Now I can’t complain too much since I’ve been a bear for all this year, but sfter taking some lunch money out of the market, I just stood aside. It was getting a bit scary. Did you notice GOOG and GS? Wow…and others like F AXP and COF. Everytime I thought about getting back in, thinking that it’s time to reverse…bang! It just continued down. So I just watched and learned….after getting burned too many times in one day. 
And the amount of ES futures contracts traded grew again to over 3.5 million contracts. Something is going on. We should have a little bounce on Monday….but then again, I thought today would be a bounce. We’ll have to see what kind of rhetoric we get on the Sunday morning news shows and what futures show Sunday evening. But a bounce may just be a small reprieve. After a little breather we continue down for maybe another 50 S%P points….but I was never good at predictions. I’m much better at 15- and 60-minute charts. 
Bank failure Friday continues into 2010. Federal regulators have shut Miami-based Premier American Bank, the fifth bank failure of 2010. These five failures in 2010 so far, compare with the total number of bank failures of 140 in 2009, 25 in 2008 and 3 in 2007. Oh well….maybe things aren’t getting better. That would explain the market actions this week.
Have a great weekend everybody. Relax and get those charts off your mind. The market will still be here Monday….I hope. 
What a wonderful day for the bears! And going into today I was already set up bearish, but jumped in even more in the pre-market. I had 9 equities trades and 3 futures trade today, and it ended up being the best day this year…all by noon!
The markets all went down and hit bottom by noontime. After that they just meandered up and down a few points and ended near their lows. ES futures had almost 3 and a half million contracts traded today…haven’t seen that since last year. And the VIX caught a 22-handle, up almost 20%. Looks like fear and volatility may return to the marketplace. Thanks to the Prez for injecting it.
It’s also the first time we had 2 down days in a row since early December. That’s over 400 points from the Dow in 2 days. The Dow ran right thru its 50 day moving average, while the S&P came to rest on its own 50dma. After such a big red down candle I think we may have a bounce or at least a narrow range inside day. If the selling continues, oh boy, it could get nasty. 
Isn’t it funny when you walk into a investment firm, and you see all of the financial advisors watching CNBC — that gives me the same feeling of confidence I would have if I walked into the Mayo-clinic or Sloan Kettering and all the medical staff were watching General Hospital…
– Senior portfolio manager, UBS
Here’s a good ying-yang story…..the ying:
Obama hits Wall Street, pushes for bank limits
…and the yang:
Geithner has reservations on US bank limits
And I guess the Democrats haven’t got the message from the Tuesday election results. But then again, Senator Dodd isn’t running for re-election:
Hands Off Our Slush Fund! Thune Amendment Fails
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....
