Financial history doesn't repeat itself, but it often rhymes. You can't be stupid enough to trade off anything I say.... I'm lucky they let me out of the straight-jacket long enough to trade.

J. P. Morgan

"Sell down to your sleeping point"

Friday, July 31, 2009

Hard part about today

Is that there is money comming into the market for the end of the Month.

7 comments:

Tony said...

I would normally say that this would screaming for at least a pb on Monday with a new month and a phenomenal run here...

... but I've call 6 of the last 3 pb's, so I'll watch from the sidelines and miss this one. Geez.

Eric said...

You still have to think in form of game theory.

though new money flows come in end of the month...

there has to be some anticipation of it.

and Mucho.... Supply to sell to the fund managers.

Tony said...

I guess I'm unable to think out to the fifth derivative game theory function.

To achieve alpha it seems you have to call 3 out of 4 blips on the chart... miss one and your profits diminish rapidly.

I'm going to whine a bit here: while I'm up 2.8 X the market for the first half of the year, one bad couple weeks and it's cut by a third. I completely missed the July rally and got caught short. Ouch.

T.Lo's beta approach is looking more appealing, especially with the weather so good lately. lol.

Tony said...

BTW, you can use that last comment as some sentiment indicator, FWIW.

Eric said...

I'll send you an email...

Seems to me like for the most part..

this is the hardest part of the sentiment chart to trade.

Eric said...

you can use the Eric approach

when in doubt... Day trade.

Tony said...

Thanks. Or I can use the Tony approach... when in doubt, don't trade. LOL.

I'll look forward to the sentiment cycle email, because it seems we've blown past the aversion and are buying the dips. I was hoping to play some shorts to Point E... have we missed it?

The last chance would be for XLF to fail to break thru the 13.09 horiz resistance (sorry); alot of people are keying on that level as a "breakout" to the upside. If it fails, we could go to aversion I suppose. Maybe the thing to do is go short XLF with 13.05 as a buy-stop --- just thinking out loud.

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