Thursday, September 29, 2011

Set your bets and go to sleep? (updated 1010 am HST)


8:16 am (Hawaii) Not so long ago I got a handful of FAZ at 60.53. Not the optimum price like 55 or 53, but it suited me okay. That was at the end of Tuesday. Today, right now, FAZ is at 64.92. Had I done a Rip Van Winkle, slept through all this political economic hoohaa, I'd wake up and be pleasantly surprised with a gain of more than 4 bucks a share. Instead, I sawed away and gave away what would've been a profit yesterday. Only in the past hour am I back to break-even on the latest position.

For now, predators are feasting on imbeciles, and the carnage is just beginning. Nothing's free and if you can't protect it, you get eaten. Can't help that it's just a little funny to watch sometimes.

Update 9:02 am Did anyone see that move in the minutes before the final hour began. That was 8:55 to 9:00 here. Dow rallied as if there was going to be some mad upswing, got up to +13. Yesterday, there was a distinct move at the top of the hour. Today, 9:00 arrived and the Dow started tanking. It's 9:04 am now and the Dow is now -38. I have no idea where it finishes in 56 minutes. But that looked like a trap for the traders who might be playing a move right at that 9:00 tick.

Update 9:12 am FAZ went from 64 to 65 in a hurry, now 65.36. I'm now in the living room, TV is on (mute) and I'm watching the daily chart only. As long as I line it up with my megaphone and pennant patterns, I'm not switching over to the 1-minute. Otherwise I'd have to draw it all over again. That's one odd way of implementing self-discipline.


As I type, a major battle between bulls and bears is in place. Le Fly is right, despite the relatively up or flat numbers today, so many stocks have been forked that it looks very much like an avalanche is not far away. In the past few minutes, the Dow has gone from about -35 to +15 or so, then back to -35. Wild swings and battles in the trenches.

Update 9:37 am How horrendo. I watched as FAZ rallied to 65.41 and I was in the green by 1.30 or so. Then the indices rallied and FAZ went down, down, down. I had to get out or get piled over in an avalanche due to the nature of 3x short ETFs. If the algos go bullish, get out of the way. I exited the position at 62.20 62.26. FAZ is now at 61.86. It went from a winning trade to a loser in what felt like seconds. If this was going on at mid-day, it's a different decision. In this final 30 minutes, I can't take that kind of chance, the odds stacked against me. Should've sold most or all of the position above 65. Absolutely unpredictable.

The only good thing is that FAZ rallied off today's low, saving me $3/share. Scaling out is going to be a necessity from now out. The market may be wrong. Being right doesn't mean making a profit.


Update 9:55 am It's less about the hows and whys. It's about price. The ancient adage, "Buy low, sell high." It made no sense for the market to rally in the last 30 minutes after going back and forth for hours. If anything, the algo machines sensed that peon traders (me) were leaning one way, and the machines went the other way, raking in profits all the way up. I'm not saying the German vote in favor of a Greek bailout wasn't going to boost the market. But for the market to go from indecisive to straight-up-and-away without any catalyst is just the new norm. 

FAZ is at 60.37 in afterhours trading. From here, does the market go blindly into melt-up mode for the near term? I tend to think so. That'll lead to higher gold and silver price, which I like.

FAZ at 65 was a very so-so entry point. FAZ at 60 a little better. At 55, 50, 45, far better. It's probably coming. And as Greece and other Euro party states get closer to default in the coming months, FAZ will return to 65, 73, 81. 100 will come, too. Just not today. 

Tomorrow? Will Sept 30 be a one-day free-for-all window-dressing blastoff? Maybe. 

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