What the $%@&* Trading!

Well that was a pretty lackluster options expiration week, and I see volume moving even lower for the next 2 weeks as everyone takes some time off heading into Labor Day. With the lower volume we’ll see chop-chop-chop in this non-committed market.

The indexes have had a nice up move since mid-July, so a small pullback or some consolidation makes sense. A bigger downtrend may bring us to retest recent lows…..and beyond! On the other hand we are up against a long-term trendline coming down from the May high. A close above that may continue this summer bounce.

Commodities are looking oversold, so I’m adding DBC to the watchlist so I don’t have to look at each sector separately. DBC is getting support at its 200 day moving average, so it looks like a bounce candidate. Some other stocks looking good for this week: ELN looks to be filling the gap; so does PAET; ABK just because it has been so good to me the past several weeks. Gold and oil stocks may be plays also…I’m guessing to the upside, but we’ll have to watch closely.

Happy Trading

…not even a gold one….nor platinum! Boy, the metals are sure taking it on the chin…or if you’re a metals bull, you may be taking it up somewhere else Actually, all the commodities are taking a break from their bull run.

The equity markets are taking advantage while they can. This week has been pretty good for traders, with its chop and volatility….and I concur, it was good for me. I cashed out of my QQQQ and IWM calls, CPSL was good to me, and I got a gift from ABK, making 35% on some good news….yippee

This week has made it into my personal Top 5 list of best trading weeks. I think I’ll reward myself with some sleep. Catch up with you later……

..and definitely in my personal top ten best ABK popped afterhours and allowed me to take half off the table for 35%. While many of the steel stocks didn’t do much, CPSL had a nice move. And the QQQQ calls and IWM calls are still producing. XLF had a nice bullish engulfing candle pattern and bodes well for the financial sector tomorrow….and if the financials are happy, the rest of the market will play along.

Gold slapped me in the face with DGP and GDX and makes it look like gold may continue to bleed down.

Overall I’m looking for a bullish day on Friday option expirations day, but maybe a lot of profit taking going into the close. I know I will be!

The indexes dwindled down all day….close to 2% +/-….led by the financials. Did you see some of them? GS down 3%, JPM down almost 5%, LEH over 10%, MBI down 12+%, ABK down almost 20% And the Treasury Secretary didn’t have enough bullsh!t in him to turn things around, or at least stop the downward movement.

There were a few good plays early on in small drug manufacturers. I had a quick play in DEPO and I’m still holding on to MBRK and SUPG. Have to see what the morning brings. There looks like shorts may abound, but I find it hard to be bi-directional….I’ll go either way, but only one direction at a time

Volume was lousy all day, but seemed to increase a bit going into the close….a bit better than Friday’s volume but still well below average. Many of the stocks I was watching were half to one-third of their average vol.

Although I have some long positions, they are half-sized, taking half off the table at the close. I think I may go through my scans this evening looking for shorts…or at least find some in either direction and waiting to see what the morning futures tell us.

Today wasn’t as nice as yesterday….but still a very productive day, kaching $$$. It was a snoozer overall. All the indexes hit their 34ema’s, as did many stocks…and now we need to see if we pullback or break on through to the other side

I expect some consolidation…which would be a good thing. Been having a whole bunch of fun with the financial sector, MBI, ABK, FED, IBCP. After a week of great upside, it’s time for a pullback or at least some sideways moves.

Tomorrow is the biggest day, I mean the greatest amount of earnings reports. We’ll see early on how they shape the day. Of course yesterday was a lousy earnings day but the market recovered lickity-split. Let’s watch how this story unfolds…

That’s all you had to do today….play the airlines and the financials. Did you make money? The best day since May for me

The first hour was choppy with good earnings and lousy inflation data, but once the build in oil was announced, we never looked back. Will we follow through on Thursday?

I’m still in my financials, ABK and MBI and was in and out of the airlines, UAUA, CAL and AMR. The QQQQ Sept calls are still percolating.

Big, big earnings tomorrow that can push and pull the market in any and all directions. Some of the biggies are GOOG, MSFT, KO, JPM, MER, IBM and a whole bunch more….one of the biggest earnings day. And the news: Building Permits, Housing Starts and Unemployment Claims..May be a crazy one….hang on

I was primed for that move today, but I didn’t think it would retreat….damn! I’m groveling near the bottom here, adding to my long account, getting out when the money is good, but wanting more

Still in my ABK and MBI and loaded up on some QQQQ Sept Calls near the bottom. Let’s see how that turns out.

The Dow was down only 45 points and the S&P was down 11, but that is a lot more downer than I thought it would be. I made some profits on ABK, HYGS and MBI at the open, but my second half of HYGS got stopped out and I’m still holding ABK and MBI, both still green…but barely.

I feel bad about HYGS because it hit Friday’s open and then bounced. I think next time I’ll set the stop a couple pennies lower. But rules are rules and I live and die….I mean buy and sell by them. I’ll feel good if goes lower, but bad if it bounces from here.

And I can’t believe how bad the financial’s did today. Did you see NCC and WM? Big down candles…all on rumors. That sucks. I know I’m not in either, but still. If any of the rumor mongering investigation be the SEC proves anything, I hope they get the chair

All the market/index action happened on lower volume…so I guess that’s the good news. All the market makers have long weekends with Mondays off during the summer, so let’s see what happens tomorrow.

Anticipating a run-up after the weekend, I went long ABK and MBI late Friday afternoon. I closed one-half each position this morning for about 20%. I’m still holding both, still green, but not as green as it was earlier. I’ve got Friday’s open as the stop, but I am still looking for same green action on these.

Today was much uglier than yesterday was fun Whereas yesterday we had a little down then a big up, today was a little up with a bigger down. The last 2 hours looked a bit panicky as well. Today’s down volume was a bit smaller than yesterday’s up volume.

Still, I had some nice stocks that acted well while the indexes turned over: URRE, CHP, MCGC and ABK, although I dumped ABK within an hour.

Richard Arms came up with the Arms Index, or TRIN, to measure up and down volume. You can follow this as TRIN-X in TeleCharts, or as $TRIN in Tradestation. A reading of 1.0 is even between buying and selling pressure….over 1.0 is bearish and under 1.0 is bullish. But more important is the trend…moving higher is increasing in selling pressure and moving lower is increasing in buying pressure. If the TRIN closes over 2.0, it usually results in a bounce the next day…9 out of 10 times. If it doesn’t bounce, the market is in real trouble. Today, the TRIN closed at 2.29.

You can read up on the TRIN and learn some useful stuff by reading 2 of Richard Arms’ books: Profits in Volume and The Arms Index. These should be on every trader’s bookshelf…..and tomorrow we’ll see if he’s right….or maybe it will be the 1 out of 10 times the markets continue down