Tuesday evening cinema & library (updated 2 am HST)

Waikiki

12:00 pm (Hawaii) He's right about this.

Cramer: Bernanke just shot Treasury bonds in the back of the head, making equities the most attractive place to go. He guaranteed that CDs won't keep pace with the rate of inflation.

Update 1:40 pm (Hawaii) Really tempted to start scaling into AAPL and/or add to DGP. I had this dilemma yesterday with DGP at 60.27 and opted to not add. DGP now at 63.25 as Asia trading begins. Asia has been big on gold lately while price comes down stateside, though hardly enough to stop this gargantuan run.

I won't mind staying put here and saving some powder for tomorrow, but the possibility of Bernanke staying quiet for 17 more days (Jackson Hole) could permit upside momentum to go wild. There's also the possibility that further chaos in Euro and/or US banks could lead to another series of crashes. For now, the momo is rising, so ... then again, the robot space alien machines put the turbo boost into final hour of trading. These evil machines could easily take the market back into the red before the opening bell tomorrow.

It's a maddening environment. I'd like to run my fingers through a treasure chest of shiny gold coins and be done with the lunacy.

My Regular watch list is 84% green going into the close of after hours trading. Metals list is 72% green. Volume is fairly strong across the board. Machines?

Update 2:00 pm (Hawaii) Scott Nations: "Our markets cannot rally as long as a bunch of people think they're better off holding gold."

Really? I'm in favor of both: ride the market up or down, and accumulate physical gold and silver.

Just opened a medium position in AAPL (at 375.45) and added more DGP (at 63.40), both before the close of after hours trading. Spot gold is at $1,763.60/oz. Basically, it's the angel price of Jim Sinclair. That's not why I'm adding here, though. If the market tanks, gold will protect. If the market rises, Asia has proven enough that it will continue to keep gold moving forward and higher. The debt crises of the US and Europe (and soon, the real estate bubble of China) are all intact.

Fucking beats losing to inflation every day.

Update 2:15 pm (Hawaii) Liesman (CNBC): Pegging the date (mid-2013) makes this Fed move more powerful than QE2 was.

Anybody believe him?

Blogs

(new) Turd Ferguson: (pm) Silver to $44 (Aug 9)

> Gold 3-hour chart | hourly chart | 15-minute chart

(new) Jim Sinclair: In the news today (Aug 9)
(new) Silver Shield: 10 reasons why gold is gut reaction, why silver is smart decision (Aug 9)
David Schawel: Stealth QE3 is upon us (Aug 9)

> "Not the explicit 'Operation Twist' that many expected, but essentially the same thing."

Dave Fry: Market volatility on steroids (Aug 9)
Le Fly: (pm) Can we resist the temptation? (Aug 9)
> "Providing the ECB controls the bond vigilantes in Europe, there is no reason to believe we will not charge higher by another 500 Dow points."
Scott Blier: Downgrade? Phhhhhhtttttt... (Aug 9)
chessNwine: (pm) Multi-punch combinations (Aug 9)
Le Fly: (pm) The Chuck Bennett Bottom (Aug 9)
Le Fly: (pm) We're on our own (Aug 9)
Le Fly: (pm) Happy to get some of my money back (Aug 9)

SGS: Fed to keep rates at record lows (Aug 9)
Scott Blier: (am) Hoping for a black helicopter... (Aug 9)

Mineweb: Next leg up for silver could take it to $65-76/oz - Morgan (Aug 9)

King World News: Nigel Farage: London on fire, so is gold, millions terrified (Aug 9)

King World News: Stephen Leeb: Silver to hit $200 within 24 months (Aug 9)

Turd Ferguson: (am) Never doubt Santa (Aug 9)

> Gold 10-minute chart | 15-minute chart

Turd Ferguson: (am) The madness continues (Aug 9)

barnone11967: Gold's all-time new high of $1,774.30 (Aug 9)

george4vlogging: London riots = insurrection, coming to US soon (Aug 9)

SGS: No title needed, this must be a free market choice (Aug 9)

Jake Gint: (am) Timing the flip (Aug 9)
chessNwine: Might as well have an olde fashioned crash (Aug 8)
Jake Gint: And away we go (Aug 8)
Scott Blier: They bought a year for $600 billion (Aug 8)
Scott Blier: Argue with me, but you'd be wrong (Aug 8)
Scott Blier: Dow chart showing 10900 as THE level (Aug 8)

Blog commentary
theedge111: 'I have yet to hear what the earnings ratios are if we slip into a recession' (Aug 9)

Vlogs

chessNwine: Stock market recap (Aug 9)
Realist News: Worried about silver? LOL, why? (Aug 9)

endlessmountain: The Silver Log - Silver, gold, Bernanke and Jeopardy (Aug 9)

Casey Research: The Great American Debt Crisis (Aug 9)

silverfuturist: Another gold high $1752 with silver flat (Aug 9)

Jim Comiskey: (am) Daily market insights - Metals futures (Aug 9)

BrotherJohnF: Silver update - Game changer (Aug 9)
chessNwine: (am) Prior stock market crashes (Aug 9)

barnone11967: Riot in London, market rising, bailout for Bank of America (Aug 9)

> Perspective of someone who has never traded a stock

ScrapGoldBusiness: Fork Report - JPM predicts gold to $2500? I don't think so (Aug 9)

Realist News: Monday Bloody Monday (Aug 8)

SGTbull07: Meltdown: Gold explodes, Chapman interview (part 1) (part 2) (Aug 8)

Audio
King World News: Nigel Farage (Aug 10)

King World News: Peter Schiff (Aug 9)

Reports

(new) Rick Munarriz: Baidu's talk is cheap (Aug 9)

Business Insider: Stocks, bonds, Swiss francs on a ridiculous face-ripping rally (Aug 9)

Federal Reserve: Press release (Aug 9)

Business Insider: Fed extends super-low rates until 2013, may use more tools (Aug 9)

Business Insider: Richard Koo: The ratings agencies may destroy global economy once again (Aug 9)

Business Insider: German politicians want Spain, Italy to sell off gold (Aug 9)

Business Insider: Perpetual ZIRP and one-way street (Aug 9)

Video

(new) Bloomberg: Marc Faber on the Fed and gold (Aug 9)

RT: Celente: 'S&P downgrade is an Archduke Ferdinand moment' (Aug 9)

MSNBC: Dylan Ratigan on political panic (Aug 9)

Apple top, VXX bottom?

The last time AAPL got this high, it sold off and the Flash Crash marked a near-term bottom. Shares then ran back up to the 265 range twice, selling down to lows of 231 and 242 along the way. Yes, it's been one of those years for AAPL investors, a series of fantastic production and sales. If there were no global economic slowdown, who knows how much higher AAPL would be?

At 271, AAPL is threatening to break out and put bears in a world of hurt. With stochastics at an overbought level (89.45) and the general market also overbought according to several indicators, AAPL seems destined for a pullback. But could that line of thinking be wrong? Maybe.

1. Quadruple witching this week will climax tomorrow, marking the end of a propped up week or the beginning of a new move up after two months of bearish activity.

2. Though AAPL appears to be overbought, it has a history of staying above 80 (stochastics) before. From late February to late April, AAPL stayed at 80 or above and shares went from 205 to 272.

3. Not a technician here, but how often does a chart show a triple or quadruple top? With bulls so persistent, AAPL simply refuses to break down. Not that it can't happen, but if we're heading into another global crisis, AAPL could certainly fall below 200, 150, even 100 again. Would it be the China real estate bubble? The second wave of US mortgage destruction? Euro discard?

So, we could be in for two months of bears screaming that AAPL is about to sell off. Or AAPL could finally complete its consolidation and launch into another galaxy. That's why I really don't see the point of shorting AAPL, especially here. Demand for iPhone G4 is massive even as jobs numbers are mediocre. The iPad is selling far beyond even the most optimistic expectations.

If AAPL sells off from here, I won't be shocked. The market isn't exactly manic with bulls here. There is simply a shortage of selling and inflows still aren't that great and probably will take a long time to rise back to pre-Flash Crash levels. But AAPL has been tagged with projections of $300, $325 and $330. Take away all the negative catalysts in the broader market, and there's no reason why AAPL can't get to 330 or higher.

With that in mind, VXX has usually been the evil twin of AAPL, rising when AAPL sells off and fading when AAPL explodes. If 271-272 is the ceiling for AAPL, VXX may be a buy here below 26.

I love me some Apples, and when I buy some again, VXX will be my hedge. For now, I remain on the sidelines, watching with 100% cash.

AAPL 1-year chart (daily)

AAPL 2 month chart (daily) vs. VXX

AAPL 5-day chart (15-minute bars) vs. VXX

AAPL 2-day chart (5-minute bars) vs. VXX

They're almost a perfect hedge against each other when paired. VXX isn't chartable, really, not like most stocks. But it's worth noting that shares touched the 200-day average and came back toward the 100-day average, bounced back to the 200, and now have dropped back to the 100, where it sits now. Also, the 100- and 50-day averages are converging here, right as quad witching beckons.

VXX 1-year chart (daily)

Shit's about to stir tomorrow, just my guess, and unless Santa Claus has a lot of early gifts for us all, I don't see a catalyst for the bull argument just yet.

Candlestick analysis
AAPL: "Hold" (American Bulls)
VXX: "Wait" (American Bulls)

So much for Mutual Fund Monday

Dow Jones 10,190.89 -20.18 -0.20%
NASDAQ 2,243.96 +0.36 +0.02%
S&P 500 1,089.63 -1.97 -0.18%

Back from some work, catching up with today's flop-a-roo action. Bull stampede out the exits. How lame.

I once was a diehard Apple fiend. Even without ownership of an iPod or iPhone, I was and still am a lover of Apple products. Hell yeah!

But ask me if I'd trade AAPL here and I'll tell you, hell no. Today was a prime example. AAPL was up to 258 early and traded down to 254.01 after hours. I'm watching my recorded Fast Money Halftime and they're all bullish about the morning move. Can't blame 'em; Dow was up big. NASDAQ was up bigger on Apple's push.

Things closed badly. Life on thin ice goes that way most times.

METALS
FCX barely held its gain, finishing at 65.26 (+0.51%) while FXI dipped a bit (40.11 -0.40%) and X was down 0.58% to 44.56. SLV flat (+0.06%) at 17.86. This sector was due for a time out, but any time rally leaders hit a pit stop, it's wise to be cautious that it doesn't turn into a complete stall-out.

EURO MADNESS
FXE closed up at 121.89 (+1.09%), a nice gain, but off its intraday high (122.61). UUP down almost 1% to 28.43.

SAFE PLAYS
GLD down fractionally (-0.34%) to 119.60 and TLT down 0.51% to 96.91.

ENERGY
USO up by a hair (+0.29%) to 34.33 and inverse ETN SCO down a skosh (-0.07%) to 14.93. Interesting since BP got chomped by 9.71% down to 30.67. Just when it seemed BP got a nice technical bounce, it may have turned into more of a lower high than a climb back to the mid-30s. BP dropping to the mid-20s?

Natural Gas simply seems so much palatable at this point. My weekly update on the 40 natty gassers on my list was very informative, but I still didn't enter a position in any of them, not even my five favorites. Today's action was interesting. Little more than an hour before the close, 32 of the 40 were in the green. By the bell, only 17 were green and a handful of those were basically break-evens.

MMR continued its astounding rise since Obama's clean energy speech 11 days ago. MMR rose 6.18% today and is now up 13.51% to 11.68 since Obama's declaration. WPRT remained hot, picking up 5.21% to 18.99 and is now up a whopping 29.24% since Obama. This is one of my five faves, being a pure play with a solid balance sheet. It's not the finest of fundamentals, though, so some drastic profit-taking could hit the share price any time. Come on, 29% in less than two weeks ... are you going to be greedy? You can always re-enter after it sells off. I'd sell half and trade that amount for now, and let the rest ride. That's just me.

UNG, the notorious U.N.G., was up 4.65% today to 8.61. Quite nice considering it lagged while the entire sector caught fire last week. Clearly a buy below 8.00 and a sell above 8.50. PETD was up 4.04% to 25.98 and is now up 24.72% since Obama. Also up nicely was PQ, +2.70% to 7.60. PQ now up 22.19% since Obama.

The natty gassers I really like — CLNE (16.99 +0.83%), HGT (21.45 -1.7%), PSE (24.96 -0.64%) and SWN (43.54 -0.84%) — were middling at best today. I'd rather stick with these issues, which have solid balance sheets and little to no debt, than risk the acidic atmosphere of so-so natty gassers that are trading mostly on daytrader momentum (low floats).

FINANCIALS
FAS down 1.43% to 22.49. FAZ up 1.26% to 15.30.

GS dropped 1.62% to 133.44. It's just ugly down there. When financial uber-bull Dick Bove adjusted his estimates lower for GS last week, that was as rock-bottom as it gets. Or does it get worse? C broke even today (3.88), while Euro banks were varied. IRE (4.05 +0.25%), NBG (2.43 +2.53%) and STD (10.45, -0.95%) doing their usual quirky moves. STD has been more steady, bouncing out of the 9-10 range every time. Spain has major unemployment issues, but as a whole seems far more sane than Greece.

Thin ice. Please avoid.

I'm staying 100% cash. Didn't touch VXX after hours. That means it'll probably pop in the AM. Whatever. Take caution. This market is icy hot. Or hot icy. I'll get my sleep, trail at a safe distance and be selective.

Next up: Bulgaria, Romania

They're going right through the lineup like Strasburg against the Pirates. Bumpy road ahead for Euro paupers Bulgaria and Romania. Ilie Nastase, where are you?

Bear Orgy

Every technician I've seen online this weekend hates the charts of every stock, index and long-side ETF (with the exception of gold/GLD). There is hatred, a byproduct of — no, not fear — Friday's thick selloff. There are selloffs on weak volume that lack conviction. Friday's offing had significant volume, but really, was it deep enough to warrant this groundswell of doomsday forecasts?

We'll see soon enough with premarket trading just 2 hours away. At this point, futures have improved, as has the Euro. 

Hungary’s BUX index dropped 3 percent as OTP Bank Nyrt. sank to a 10-month low after Index news website reported that the new government is considering a special tax on financial companies. The forint gained, reversing the biggest two-day drop since 2008, after the government pledged to stick to the budget deficit goal approved by creditors and distanced itself from comments raising the prospect of a default.

This is the bottom?

Dow Jones 9,931.97 -323.31 -3.15%
NASDAQ 2,219.17 -83.86 -3.64%
S&P 500 1,064.88 -37.95 -3.44%

Hungarian bottom (Debreczeni Zita at right). Bad jobs report. Kaboom! Sure, maybe today's selloff was an overreaction, but explain why the up days this week were low on volume and today's drop came on massive volume?

The outflow continues. I saw some incredibly brave buying (and refusal to sell) in UNG for most of the day. Thankfully, I didn't chase, and once it hit 8.47, it was mostly downhill from there. That was one of the few good-news stocks today for longs. A week ago I would've been relishing today with a position in VXX and maybe FAZ. Still don't trust financials, particularly with the the market now in the Post-Stimulus age.

When AAPL is selling off like cheap wine, there are definite problems. Naturally, high fliers like BIDU and IMAX have no footing when the ledge is only big enough for kings like AAPL.

• AAPL 255.96 (-7.15 -2.72%). Beyond ugly after rising early and cutting through the teeth of a vicious, bloody open. AAPL sank from 261.90 to 254.63 and struggled to stay near 256 the rest of the day. I wanted shares below 260 and I got my chance. May still open a position before afterhours session ends. WWDC starts next week, which should be bullish, but don't be surprised if shares sell off on the news of the iPhone 4G.

• BIDU 73.20 (-3.46 -4.52%) down big. So was IMAX 16.12 (-1.05 -6.12), which is heading toward Flash Crash levels. Enticing? Yeah, if you forget that there's nothing close to an Avatar on IMAX's plate. The next true blockbusters are coming next summer and the summer after that. If you don't agree, go drink some Kool-Aid out of a McDonald's Shrek glass and enjoy yourself.

• DNDN 40.84 (-2.53 -5.83%). Pounded and pounded since hitting the 50s when Provenge was approved by the FDA. At some point, DNDN will escalate with or without the market simply because of the math. Provenge's projections are off the charts, but if shares are back to the 20s by the time the treatment is in hospitals, I'd rather enter there than here at 40.

• F 11.50 (-0.46 -3.85%) is also dipping near Flash Crash levels. A steal below 11 unless auto sales drop. The jobs report today hurt Ford as much as any American company. It's been six straight months of rising sales for Ford. Now the bias is turning against it.

• FXE 119.28 (-1.94 -1.60%) struggled today even though Hungary isn't part of the Eurozone.

• FXI 38.36 (-0.94 -2.40%). Another breather for one of the hottest overseas ETFs. The housing bubble looms overhead as a dark, dark cloud. As a result, US Steel (X) dropped 7.27% to 41.97.

• GLD 119.19 (+1.23 +1.04%). An entity unto itself as currencies around the globe lose value and favor.

• GOOG 498.72 (-6.88 -1.36%). Still no stopping Google's growth into mobile advertising and smart phones.

• GS 142.25 (-1.79 -1.24%) and C 3.79 (-0.17 -4.29%) bit the dust, but there has to be a little optimism on the relatively small loss for Goldman. FAS took a blast in the face, dropping 2.91 (-12.04%) to 11.50 while FAZ gained 12.12%.

• Euro banks NBG 2.33 (-0.18 -7.20%), IRE 4.72 (-0.22 -4.45%) and STD 8.95 (-0.82 -8.42%) were mauled.

• Meanwhile, the natural gas sector was buoyant at the open despite across-the-board declines. Most nat gas stocks rose and were in the green for awhile before profit-takers left the vicinity as Obama's proclamation to "embrace" clean energy faded after nearly two days. UNG 8.18 (+0.17 +2.12%) hung tough before selling off late in the day.

• Cramer's newly-touted natty gasser, WPRT, closed at 17.23 (-0.09 -0.52%). A dip to 16.61 gave Cramericans a chance to get in at a decent entry price. The only natty gassers on my list of 39 to finish positive were CLNE 16.76 (+0.19 +1.15%), KWK 12.25 (+0.13 +1.07%) and UNG. The two-day run had to end sometime, especially with 20%-plus gains in a few issues.

• In addition to FAZ, VXX tore it up, gaining 10.18% to 31.14. SCO 16.53 (+1.40 +9.25%) hammered the oil bulls, and TLT 97.79 (+2.56 +2.69%) favored those seeking safe harbor.

• BP 37.16 (-2.11 -5.37%) is faring better than I expected. The CEO's flippant remarks today were about as incredibly stupid as could be imagined. He did shareholders no favors. Maybe it's by design. Maybe BP wants to buy back shares at a lower price. Maybe they really do expect to dole out dividends, that the Fed won't have the clout to order non-payment to shareholders. With this kind of arrogance, it's no wonder they ran roughshod through sensible safety boundaries in the Gulf.

• If you hate BP enough, you might've enjoyed betting against it through SCO. What a killer trade that's been for nimble traders. 

So, do you really believe this is the end of the latest dip?

I don't. As if what we believe matters. Just enjoy each bottom as they come.

Photo: on205th.com

Tornado Thursday

Dow Jones 10,068.01 -376.26 -3.6%

NASDAQ 2,204.01 -94.36 -4.11%

S&P 500 1,071.59 -43.46 -3.9%

Not-so-good jobs report. Financial reform all but signed, sealed and delivered. Higher taxes for the wealthy. Euro Crisis. China slowdown (meltdown?) and real estate bubble.

Nobody has the one great solution, an antidote that goes down easy for all takers and sufferers. Nobody wants more pain. But there's no pain-free formula. The answers are mostly simple. The will is not quite there wherever we look, whether it's risk on Wall Street or risk at the bottom of the Gulf.

It's beyond control for most of us. So we play the market. My day was sucky until the last hour, when I finally got it right on VXX and entered a position on FAZ. Obama's talk didn't shoot down either. If anything, these levels may become a short-term support level, if that can be said of ETFs and ETNs.

For someone who may be generally optimistic in nature, shorting stocks or even buying an inverse ETF/ETN is a jolt to he mind. I'm somewhat optimistic, but after being beat down over the years by sudden turns in the market and certain stocks, I have no qualms about recognizing the direction of a market and hedging along with it.

I just wish I'd added more VXX and FAZ before Obama's speech. I'm 55% cash, ready to buy AAPL long if there's a magical turnaround in the morning and we all get a happy bounce off Flash Crash 1065.

Will we bounce? Maybe a skosh. Technically, the market is due. But after any kind of bounce, the fundies will unload and unleash their positions. Nobody trusts this market right now. Nobody.

Wednesday whammy: Apple bottom's up?

Dow Jones 10,444.37 -66.58 -0.63%

Nasdaq 2,298.37 -18.89 -0.82%

S&P 500 1,15.05 -5.75 -0.51%

Signs of a bottom? Someone unloaded a warehouse full of Apples this morning. Was it you? Maybe this is an apple bottom.

It happened with startling speed, from 10:10 am (Eastern) to 10:21 before there was a reversal that stuck. Shares went from 247 to 244.85. That move really buckled the market's knees, and it never really got another good shot in against the bears. AAPL closed at 248.31 (-4.05 -1.60%), its lowest close since the day after the flash crash. Of course, 244 was the liftoff level of AAPL before the rocket ride on its unprecedented earnings report.

Someone was brave and/or gutsy enough to grab AAPL at 244-plus. But if shares drop below 244, there will probably be more Apples tumbling. The market doesn't move up — the correction doesn't end without AAPL leading the pack.

Until then, the seas of the market are choppy and practically unnavigable for bulls and bears alike. Though they popped nicely early, FAZ and VXX slowed to narrow trading ranges and lost some gains in the afternoon.

The only real strength today was in the Euro (FXE 123.50 +1.73 +1.42%) and financials. C, GS, NBG, IRE and STD were all up at least 2%.

So, for the uber-bullish, today was an opportunity to grab AAPL below 245, BIDU below 69, C at 3.71, GS at 136.10.

More signs that the bulls may be right: US Steel (X) gained 1.7%, GLD sold off 2.4% to 116.63 and USO (US Oil Index) finished green (33.47 +0.04 +0.12%).

What does it all mean? Who knows. I'm back to 100% cash.

Apple, euro and hedge

One of the most persistent AAPL bulls is author Jason Schwarz. Relentless, this guy is, about all things Apple. And yet, he is a realist. As AAPL has corrected with the market, he has hedged his bet with EUO.

Yup. He's short the euro. But he's also optimistic that the euro will bounce back. How? Why? Because it has to for the sake of Europe and the sake of America. Here's what he thinks.

A two-month chart of AAPL vs. EUO. Looks like EUO has the edge in the near term.

Here's the FXE (euro) vs. EUO, two-month chart. Again, euro sucking. Edge, EUO.