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"

Monday, January 25, 2010

Litttle boy Joey, with his Jet Poster above his bed.

All the traders, excited about their Jets, all the years of wanderlust dreaming with their little Pennant above their bed, with the Star Wars sheets.

awwww... disappointed.... maybe next year...*sob sob in their Coco Pebbles"

Ok, Enough teasing the traders.

All the market pro's are on the "Crash" again... I would feel better to see a nice slow market slide, but it's not up to me. Mamis and Doug kass are buying gold... because it may have value... or not.. Ugh... I'll try and resist the Siren Call.

but it creeps me out when I hear the MEME... Personally I am just trying to keep it together.

They should try and "buy it with both hands"... I'll be curious how it will work out for them.


Tony said...

Now we're short term oversold, but this could get uglier for longs. Any insight on using TLT, IEF Vix or event the Libor rates to judge short term fear?

I think we might need a proprietary Davis Fear Index (tm) to go along with the DSI.

Where is DSI btw? My guess is it has dropped back to about 7-ish on the 1-11 scale. (11 = max bullish)

This morning we had some good grail short set-ups on the 65-min and still have a few on the 5-min.

Eric said...

We still are running a good 8 if not 9. All depending on if we toped out at about a 14 on your 1-11 scale.

This morning it was very much "Vix is oversold, there is real Fear in the market"... and they say all this while giggling and saying "buy them with both hands"


even the pessimists are "well if we do sell off, minor correction."

Tony said...

DSI = 8.7. Got it.

So DFI (tm) still low at 3-4? (Scale 1-11)

Eric said...

That is a tough one, I think we are in a Hell bent economic death spiral of stupidity, and there is no way out.

so... I'm fairly scared.

Eric said...

hmmm.. I wonder if you wanted me to comment on how afraid they are?

Tony said...

"No way out"? Man, you're bummin' me out. With this mood, you must have been reading T.Lo's weekend homework. Good stuff, really.

In a generation or so we'll be out from all this debt, or we'll all be speaking Cantonese, or both.

Eric said...

I think when brown got elected, I fired off an email to T-LO.

"We are FUCKED"

It is one of the few times, based on the market response, I had a brief flash of beliefe in EMH.

of course, i'm not sure the market knew that it was going to happen, just responding to the fact "That it happened" and now the dominoes start to fall.

Or I'm just a crazy horrible Bear.

Tony said...

Good call. Maybe we can call this the "Brown Bear Market" (as opposed to a grizzly.)

Sure we may get a nice downtrend, but more likely we'll get a 2 or 3 day bear flag back to the 50-d EMA and then some chop-- perhaps with a downward bias.

The easy bear money has been made on this. Once we get to 1070 or so the price risk is completely gone for bulls. Momo can bring it lower, but real breakdown lower would be limited.

The 200-d EMA should act as a support, but that could be up to 1070-ish by then.

That's my take, but I've been wrong before.

Eric said...

or that was top tick sentiment.

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