I suppose that’s the message he’s sending. But, he knows better given his past
experiences and responsibilities. After all, if a bank’s trading desk can
day-trade free money profitably they would. He ought to know.
There
wasn’t any follow-thru to the upside today, just a lot of two-way action that by
the close saw stocks hit by sell programs giving back at least half of
yesterday’s gains. If you walk away during the last two hours of trading you’ll
miss some great “what the hell was that” action, and that’s been the trend. The
last two days reminds me of the old maxim: “One day you eat the bear, and the
next day it eats you.”
Today was about earnings [crummy], more
government intervention including bailouts; backstops; schemes and dreams, and
ubiquitous program trading.
Volume continues to be relatively light
while breadth was as negative as expected.
There’s no question authorities have not ruled any action
to help markets. Bernanke is putting all his academic research into real time
action. That’s the deal with research, it’s only that. Paulson on the other hand
is an experienced market veteran, but there has never been someone in such a
position so conflicted.
Earnings are coming fast and furious. Most have
been disappointing. AAPL, the only products American consumers seem interested
in reported and beat much lower forecasts. It, and most other stocks, are
trading much higher in After Hours trading. Just remember, most companies and
analysts have been sharply reducing estimates and then beating. That’s the dirty
little game they play.
We’re still awaiting word on LEH swap settlements that should
have taken place today. The first news bulletin reported no assigned losses
while a second suggested the process wasn’t settled yet.
I’ve been
hoping that we would get some extended sideways action to relieve oversold
conditions. The violence in the markets makes current conditions nearly
uninvestable on a day-to-day basis. There will be opportunities in the future to
put either reshort or enter long positions. But for now we’re just laying in the
weeds watching and waiting for our opportunities. Until then we remain primarily
in cash.
Have a pleasant evening.
Disclaimer: The ETF Digest is
long
FXY.
