Monday, July 14, 2008

Bulls skating on the thin ice!

Dreaming of a re-run of the Mid-March post Bear Stearns bailout rally, the (retailer) bulls jumped in at the open today on the news of Fed's rescue of F2, only to fall right into a swirling water fall as the smart money dumped what they loaded up last Friday in anticipation of the over-the-weekend Fed's rescue. You got to admire the big boys, who learned from the BSC event and executed the play to the perfection. Today's gap-and-crap action also made it clear that the market has lost faith in the Fed. Speaking of the Fed, it is probably down to the last bullet (rate cute) in its gun, which if used would be suicidal at this point.

Bears still did not show any killer instinct, which ironically may not matter much right now as bulls started to show real hesitation and fear today. As the major indices are drifting down through the 2-week mid-point consolidation zone, bulls better hope that there will be some real good news and soon or we could see the second leg down in next day or two.

Just went through my list and could not find any good swing long setups, rather, I will look for swing short setups from the following stocks: APA, DVN, JRCC, MEE, ANR, OIH, PCX, WLT.

I will also keep an eye on GS, which is on the verge of completing a head-n-shoulder formation on the daily chart. I may scale in if it spikes towards 166-168 in the early going tomorrow, with intra-day stop just above 171, closing stop around 168 and initial target around 150.

6 comments:

RAZOR said...

wonderful, yesterday drys was up but limp on the fed gap n crap, having no downside protection, I bought the expiring 70p's and sold today for +.8 each, not huge but happy with the execution.
My strategy is to continue hedging and stay undiversified.
Notice puts being bought for altr ruh roh....earnings are the only catalyst to prop this market up...

its been very quiet in here lately beuller beuller beuller echo echo echo.....

flyingwabbit said...

razor:
excellent trade again! kind of funny that you resorted to a quick DT.

speaking of DT, well, I broke the rule again by putting GS just a while ago when it spiked towards 163 and made a quick $1200 profit. A bit regretted, but I just could not have a good SW setup for days, man! the market is really a day-trading place lately.

Bears sucked again, but bulls could be the ultimate victims as this kind of slow-crashing back and forth commotion keep giving them the hope...

razor said...

1200 is nice wabbit! I wasn't trying to dt, but protect my core, when the puts actually fell into the money I wacked it, three hours later my core is +4 and the puts I sold for 1.7 are .35, sometimes we win!

fortune8 said...

I am looking to short ANR as well. Nice that we have confirmation.

flyingwabbit said...

fortune8:
boy was that close! ANR got bought out, lol! and that news discouraged me as I aborted my short setup for PCX and WLT, obviously another dumb move, hehe...

fortune8 said...

wabbit, I hear ya !!! This was one time I was happy to be late to the partty.

I had SKF shorted at 210 and covered yesterday. Took a losses on short at 202 and 204. ARGH !!!