Tuesday, October 4, 2011


11:16 am (Hawaii) Much as I would enjoy holding AAPL from 372 to 520 (Goldman Sachs' new target), the ride will take a little bit longer than we would've imagined a year ago. AAPL, like gold, is a cash cow for hedge fund managers. When the market hits the fan, they always unload their winners to cover margin on their losers. So AAPL is cursed in that sense, but it still will never tank like a small-fry stock struggling to get above 5.00. That stuff belongs far away from any trading strategy.

As for FAZ, what a day. I slept through the first 3 hours of the session, having no position. But what an insane move to 81+. I knew it was coming, but this soon, not really. Then the selloff and another run to 79+. A lot of itchy trigger fingers out there with the market severely sold off and bankster stocks at "cheap" prices. My Debt Spiral list had FAZ as one of the few plays in green, while most everything else banksterish was 2-11% down. Then came the reversal in the final hour, and MS finished +11.5%. FAS up 9.7%. BAC, which was down to 5.24 in the last few hours, closed at 5.71.

So was Bernanke's chatter part of the game plan? If that's true, it was a clever way to keep BAC from falling below $5, where many hedge funds would not be able trade it at all. Bernanke had to do it. It's not like he can talk Obama into some kum-ba-ya soliloquy about the beauty and goodness of the forking banksters.

My FAZ updates below. Huge volume today on what is a negative candlestick. Still, on my daily chart, FAZ is still in range, marking its territory in the second megaphone after spending a couple of weeks in the lower megaphone. The pennants keep rising higher each time. Though I'd really like to get back in FAZ at 55 (or lower), price looks comfortable here above 66. It's all about headline risk, and there is zero good news from the Euro banksters ahead, no Fed to bail their butts out. SCGLY, NBG, STD, on and on. They're all stuck deep in kimchi and today's move was just more proof that the market is ready and able to short these banks to dust.

FAZ daily: huge volume today

FAZ daily: The moves to 81 (twice) don't deter price from a gradual gain

Since the run to 81 in early August, there have been eight instances (including today) of a long green/white candle followed the next day by a similar or longer red/black candle. In each short-term time span, FAZ went lower in the days after. Back in August, FAZ went from 81 to 61 in the same day, and bottomed at 54 later in the week.

Then came a move to 74, followed by a decline to 50. That was followed by a move to 67, then down to 52. In the past two weeks, FAZ went to 74 before dropping to 56. Is there reason to believe that today's drop from 81 to 66 won't continue? If 66 is the new floor, that's clearly a sign of strength in FAZ and bad news for the banksters, as if things weren't smelly enough.

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