The stock market is dumping down on the news that GDP missed estimates and RIMM guided down earnings. In addition, trader's are treating the WM buyout news about as gleefully as an announcement of leprosy. Yesterday's bounce is a non-event today.
I'm not even going to bother with my bullish list from yesterday, everything is cratering this morning. I thought today was going to be volatile, but it's even more violent than I expected. The bailout hangup is probably exacerbating the selling. Any thoughts I had that the market might be shoring up a bit are gone, the extreme fear is still lurking in every corner of the financial markets ready to hurl its guts all over Wall Street. Today looks like a gut hurling day.....The volatility drumbeat goes on.....
12:45 pm MT: The drop in oil prices and the speculation that the Financials are going to stabilize a bit has put a bid under the market. For call plays: I like the price action on WFC, PNC, USB, and BAC in Financials. I like KSS in Retail, I like KMB in Cyclicals, and I like GIS in Consumer Staples.
The Energy and Commodity related stocks are selling off a bit today. Chemicals/Agriculture, Coal, Energy, and some of the Metals. Most of those trades look a bit overcooked, but I'll keep an eye on them.
This has been a volatile day, which I expected, and it has featured a few mood swings. I will keep playing most directional trades as very short swings. I'm not convinced that the Bulls are going to turn this into a big turnaround day, so I'm not interested in getting loaded up before the weekend. These kind of days take a lot of focus for directional traders.....otherwise, just walk away and watch for something to emerge next week. It's usually a good idea to stand back or tread very lightly when the Bulls and Bears are screaming at each other like they are today, (and have been doing a lot recently).
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CNBC said that wm would be a good buy at 3.50 because of the take over or buyout prospects. I guess not seeing it's trading at .16 now.
ReplyDeleteCrazy times, energy is getting wiped and the chemicals too. What happened to the weak dollar play?
Oh well maybe one day it will all make sense and we will all be rich traders, trading with ease because we were able to get through these times.
Goood luck everyone.
Great VC yesterday thanks Dwight.
ReplyDeleteNibbled into GG $35 Jan calls on opening after the pullback to $35ish following the gap up.
AEM spreads for both the $60 and $65 calls were intially 50 cents or more so I didn't bite, just as well as we're back to $62 and change after the first 2 hours. Still prefer an entry closer to $58 to $60 as you mentioned.
Thanks so much; am trading with renewed confidence now.
All the best to everyone as well.
FRancis
Looks like DIA is working it's way back up - is anyone still bullish on this for entry? or are we just going back up to resistance to come back down ( referring to the 5day/5 minute chart) ?
ReplyDeleteWow, I wonder how the history books will record this major financial event we're witnessing. I'm sitting firmly on my hands and not getting into anything new until the smoke clears.
ReplyDeleteI am with you Laurie!
ReplyDeleteMargo
Dwught,
ReplyDeletewhy am I still hearing people say "cash is a position"? If the financial system goes on to collapse, the US dollar will be worth litle therefore making whatever cash I have be worth just as little , is it not better to invest in strong companies with stock purchases?
tHANKS
Hi everyone!
ReplyDeleteI'm with Laurie and Margo. : )
Denise
Claudia,
ReplyDeleteIf you go to Starbucks and buy a two dollar coffee, you hand them $2. If you buy Starbucks stock and it goes down, then your investment is worth less. Cash in hand may be better than risking it in this crazy market(unless you can pick the bottom). This is especially true if you're a directional option trader. IMO
No Bill as of yet, but FYI here's a link to the draft.
ReplyDeletehttp://www.foxnews.com/projects/pdf/rescuebill_First_Draft.pdf
The gov't link wouldn't load on my browser. I imagine it's too busy. The URL is
financialservices.house.gov
Gary,
ReplyDeleteI guess for now cash is best.......... we'll see what the next few days bring and trade as the charts show, forget hope....... the market is the only place, I think, where hope has NO place.
Here's to Monday :)
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