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2:59PM - Dow gains +901, Riddle me this - is it a Bull Trap? (corrected)
jmski52
Posts: 22,370 ✭✭✭✭✭
And of course, gold gains about $18.90 on the day. And silver gains about $0.06 to $9.11.
Odd, huh?
Odd, huh?
Q: Are You Printing Money? Bernanke: Not Literally
I knew it would happen.
I knew it would happen.
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The market sees all well in 6 months, no problems. Consumer debt paid off, housing rebound, tax cuts and a chicken in every pot.
Ren
My "feeling" is still DOW 10K+ before the end of the year,
BUT there will likely be some sellers in the next day or two.
It was particulary interesting/telling today, that there were
relatively "no sellers" until the pop started its last run.
The bid/ask all day on TONS of stocks was super-WIDE. Folks
simply refused to sell at the low prices.
............
My AA and X trades got well, today.
AA, last year at this time, was still speculated as a takeover
in the $45 to $60 range. Not scooping it up at $9+ this week
just made no sense to me.
Even FRPT popped today, on low volume.
DUG spanked me twice as hard as DIG kissed me, today.
I have still not covered any GLD/SLV. I will post it, when/if I do.
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edit to add: Blue Horseshoe Loves MOO.
This can't be. We are all conditioned to accept stock and comex metal prices just as they are presented to us. We sheeple are obligated to fork over our gold, silver, and S&P stocks at the bid price so that the larger sharks can benefit. Carry on.
roadrunner
from a temporarily oversold condition. If the Fed fails
to reduce rates , the market will fall. If the Fed does
reduce rates, the market will still fall. This is a trading
opportunity only.
Camelot
;>
<< <i>Probably. In anticipation of a rate cut, it is a relief rally
from a temporarily oversold condition. If the Fed fails
to reduce rates , the market will fall. If the Fed does
reduce rates, the market will still fall. This is a trading
opportunity only. >>
I'm expecting as much as a full point cut tomorow.
They're just pulling out all the stops trying to prop up this falling house of cards.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
<< <i>Probably. In anticipation of a rate cut, it is a relief rally >>
<< <i>from a temporarily oversold condition. If the Fed fails >>
<< <i>to reduce rates , the market will fall. If the Fed does >>
<< <i>reduce rates, the market will still fall. This is a trading >>
<< <i>opportunity only. >>
Ahh the old bear offers up much wisdom in those double spaces.
It would be very fruitful to adhere grasshopper.
only place to be, should realize that panic buying is sometimes more
violent than panic selling.
"Fear" is generally thought to be more powerful than "greed,"
but I suspect we might be about to see an exception to that rule.
Fear of missing the greed train could kick in strong, soon.
No. I think this is for real. Industry, finance and infrastructure all have
to survive for us to survive. It follows that stocks have some value or
we'll all be gone anyway.
The real bull is a few years off yet and the low might not be in but the
Dow isn't going a great deal lower probably.
This is the correct definition of "bear trap."
While the term is often used incorrectcly, this is the ONLY correct classic definition.
.........
A false signal that the rising trend of a stock or index has reversed when it has not.
This can occur during a bear market reversal when short sellers believe the markets will sink back to its declining ways. If the market continues to rise, the short sellers get trapped and are forced to cover their positions at higher prices.
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edit to add:
I have been playing this game for a long time.
I have never seen so many folks be interested
in SHORTing stocks as I have seen in the past
month.
Many, but not most, of the SHORTs are newbies.
I suspect they are going to be crushed, very soon.
I was SHORT tons of stuff for the past year+. The
new guys are VERY late to the party.
I knew it would happen.
<< <i>Ok, so I need to re-phrase my question. Bull trap, then. >>
.............
Bull Trap
A false signal indicating that a declining trend in a stock or index has reversed and is heading upwards when, in fact, the security will continue to decline.
A bull trap often causes some investors to buy the stock, but because the stock continues to decline after the initial signal, those who bought in are "trapped" in a bad investment.
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SOME of what happened today, looked "real."
NOT all of it, but some of it.
I dunno.
..................
After today's Porsche/VW debacle, a BUNCH of folks will need
to raise CASH in Europe, before the end of the week.
Maybe they will dump US securities.
VW is now trading at about 95-times 2009 earnings.
Some beaten-down US shares are around 6-times, AND paying
HUGE dividends.
we have had "one day wonders" before only to be followed by renewed selling. one day does not make a trend.
let's see what happens over the next few days.
hopefully it is the start of a recovery... hopefully.
this is the commentary Ive been making the last few times we've had big jumps in the market, only to be followed by renewed selling.
www.AlanBestBuys.com
www.VegasBestBuys.com
<< <i>And of course, gold gains about $18.90 on the day. And silver gains about $0.06 to $9.11.
Odd, huh? >>
Well, one speculation is that recent drops in gold have been causes by stock market players having to sell gold to cover margin calls and/or losses in stock. Nobody lost money in stocks today, so nobody was forced to sell.
TD
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SHORTs lost money. Some covered in time, and some were
bought-in. Others, got margin-calls tonight.
In Europe, it appears that as much as $30-Billion was lost
by traders SHORT in the VW-PORSCHE fiasco. (Thousands
of SHORTs were "bought-in" as VW shares soared. Some
more BIG hedgies were likely wiped-out.)
Tonight, VW has the second-largest market-cap of ANY corp
on the planet. XOM is still #1.
XOM has a P/E of about 9+/-. (Up from less than 8, last week.)
VW has a P/E of about 95+/-.
Insanity is prevailing.
VW has a P/E of about 95+/-.
Insanity is prevailing.
This would imply that there will be much more oil available at lower prices, and many more VWs at competitive prices.
As Spock would say, "That is illogical"
I knew it would happen.
www.AlanBestBuys.com
www.VegasBestBuys.com
No, sorry. What is it?
I knew it would happen.
<< <i>vw >>
LOL. stupid hedge funds and go porsche! own them suits.
<< <i>vw >>
"What is upsetting the hedge funds is that if between 10% and 15% of VW shares were on loan to be shorted and only just over 5% were available in the market, it is likely that many of the funds that shorted VW had borrowed the shares from Porsche.
It meant that because Porsche had not declared the proportion of VW shares it controlled, traders may have been indirectly and inadvertently borrowing shares from Porsche, selling them to Porsche, buying them back from Porsche and then returning them to Porsche.
None of this is currently outlawed by German authorities, but many commentators have described it as bringing German capital markets into disrepute. "
Wow!
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Equally complex and convoluted "lending/borrowing" schemes
are permitted in the US markets.
......
The funniest upshot of this strange/ridiculous circumstance is
that Porsche now has so many options/warrants and equivalents
that if they were all exercised, Porsche would NOT have the CASH
to either pay for the shares OR to pay the TAXES on their gains.
With a P/E of 95+/-, some European/American traders are likely
already plotting new ways to SHORT the VW PIG.
How about just shorting a short fund as the underlying asset is running up?
roadrunner
That would work, especially if we could find a suitable underlying asset to fund the short fund that we want to short.