I woke up this morning... I actually slept in, 10 minutes of squawk, then watched West wing all morning.
But in my reading, it was apparent that traders felt the market was overbought, and ready for a pull back.
BUT!!! what they wanted was for it to trade like the last market top, where we trade up through 2-3pm, and pull back at the close, then gap lower tomorrow....
GAME THEORY.....
The secret is to anticipate the anticipation.... So.. if they were waiting for the close... you have to move that time up.... Giving us either the 1pm sell, or the 11am sell.
If you see the buy volume/sell volume change... and some minor weakness... helps.
Wednesday, February 4, 2009
Some game theory in practice.
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Yup. So they sold off Monday in anticipation of Friday's NFP.
I think you are making fun.
If they did that, they got ahead of themselves, cause we are selling for it now..
Or we don't trade news... but people didn't want to pay up for stocks ahead of the NFP.
I'm just trying to be funny, but I get what you mean. This choppy market is nerve racking. I get the feeling that BAC will drop every day until it gets nationalized. It gaps up and drops every day. Unbelievable. GE is similar.
I don't see any conviction in buying until next week. (... which means the market will be up 250 tomorrow.)
It was funny... strange is I almost agree... except we sold off last thursday and friday and monday... Then got ahead of ourselves... so we had to bounce for 2.5 days.
I'm trying to work on another post.
just to try and put some pieces together, we could hit that "Consolidation" Pennant Tomorrow. And One more day of selling is Symmetrical.
But then the selling ends Thursday at the close...
Meaning we either get good NFP and go up, or bad and gap down, and Bounce.
So you're looking for a good number?
T.Lo said something in her podcast about waiting for the resolution of the pennant before acting... don't try to predict it. I can see her point.
It seems that the NFP is too obvious to be the real catalyst. The number will be shitty, but the market will trade up anyway.
The stealth issue is the financials with a very quiet 10% drop in the last five trading days. Have you seen BAC's chart? Fugly. Citi and BAC are goners.
I have some new charts up on the correct site this time:
http://starwealth.blogspot.com/
MRVL looks, well, marvelous.
The way to play the Pennant is to play it side to side, or on the breakout.
but this has to resolve by about tuesday..
which seems to be when the "Bad bank" is coming.
Even with a breakout of the smaller Pennant, to the upside... we still have to work on the larger one.
A stock that breaks $5, usually goes to $2...
When it breaks $5, many institutionals can't hang onto it, so they puke them up, and push it to $2.... that is where BAC is.
especially with financials, where institutions hold them for the Dividend.
Excellent point on the $5 BAC price. It seemed that someone was trying to resuscitate it at 2:30 to 3:30, but it couldn't hold.
It's a goner.
Well, it could languish there for a few days.
Have you seen the futures, the naz is down 22 on cisco..
I caught 10 minutes of Fast money...
Mackie goes " 'They said new orders had slowed', that sounds bearish to me"
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