Crash Market Stocks - Financial Tips On Making Money In The Stock Market

The S&P closed its sixth consecutive day in the green as, once again, we begin another week of buying. However, one problem is that today's trading volume was the lowest we've seen this year since January 2nd (the day after New Years). So on one hand, market levels are slowly pushing up, but on the other, less and less people are participating in it. I'll let you decide if that is good or bad.

The S&P is having a hard time penetrating and sustaining the 1070-1080 levels at this point. Last week, the S&P quickly retreated from it, as it did earlier today. I would imagine that if the market cannot penetrate these levels this time around, we should see a rather strong retreat, leaving us with a discouraging October. I am still waiting for the volume to return at this point, which in my mind, will bring even more aggressive selling.

My shares of DRV have stayed pretty status quo as of this point, as I still have a stop loss in case of a run up in the markets this week. However, if data continues to be grim, I would expect to see a pull back. Earnings is the topic of conversation this week, as they kick off tomorrow. Watch out for earnings, as they are the easiest data to manipulate. CPI is another big indicator to be on the look out for this week.

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I expect to see the dollar start to make a turn around shortly as gold begins to fall from its highs. Gold call options have significantly decreased in price, signaling investors feel that we have falling prices in the future. The market still remains very unstable and volatile, however, fundamental data remains right in line with my expectations. Happy Trading.

Featured on the front page of Monday's Wall Street Journal was the announcement that Maguire Properties, downtown Los Angeles' biggest real estate owner, would be giving the keys back to seven of their high profile office buildings in LA and Orange county. Being head deep in the commercial real estate market, I knew of this news a while back and know of several other groups who will also do the same. Due to extreme pressures of the deep recession as well as increasing vacancies with lowering rental rates, Maguire could no longer afford to pay off the debt.

The article went on to say that essentially, Maguire was insolvent and they are finding themselves in heap of trouble. You would think after such a revealing day of their troubles, their stock would respond in a negative reaction. However, it was the opposite that happened. Yesterday, Maguire's stock price was up over 16% at one point. This just sums up the recent unorthodox movings of the stock market and that indeed it has recently had a mind of its own. Maguire stands as an early example of many to follow suit. Even with the stock market going up, consumer income still suffers as does corporate and retail earnings. As more time goes by, more and more landlords will have no other choice but to give the keys back. Many have tried already, but due to the amount of distressed properties, banks are selectively choosing the properties they are taking back at this point.

Today the market closed in the red having the Dow close down just under 100 points. This was a long overdue selling day that could spread depending on retail earnings this week. As of now, there has not been much action in my Zecco.com account, however, I continue to believe in the severe turn of this market. To think that indeed a full recovery could be here so quickly after almost a mass bank failure is ridiculous. Sooner or later, once again fundamentals will realign with market performance. Lets see if another round of profit taking kicks in tomorrow. Happy Trading.

For those that called it a day for trading a 3PM (eastern), most likely came back to their computers wondering what on earth happened the last 45 minutes of trading to make what was another 3% down day to just under .1% at close. So what on earth happened to make investors think that it was time to start buying? I find it no coincidence that the movement was made near the 820 S&P, as a closing under 820 would have been a pretty strong technical move. Here's some information that hit the press just in time.

With an hour left before close, the media announced Obama's plan to subsidize mortgages to prevent foreclosures. Once again before any sort of detailed information or laid out plan for the process of doing so, investors immediately jumped on the "rumor" train to gobble up any stocks in sight. It was early in this announcement that caused me to shave off some of my SRS profits from earlier (hit $70 today, I sold some at $68) and went in and bought some FAS. Just in the time before close my FAS went up 3%. This was a complete 180 degrees to what I felt I was going to be doing at the end of the day, but this is exactly why I choose the end of the day to make a lot of my moves. So, yes I indeed joined the buy craze in case this "rumor" train goes into tomorrow. Plus, I got some solid gains from SRS anyway today.



So where do I begin in expressing my thoughts of this new plan. This idea is even more out there than Geithner's plan. Subsidize mortgages? Are you kidding me? Is the government aware of just how much toxic debt is outstanding and is going to be outstanding in the next 3 years? Then what happens when commercial real estate hits the fan, which it will. He talks of securing the assets to try and incentivize banks to keep lending. Again, where is this money coming from? If Obama does indeed decide to pursue this outrageous task, it is inevitable that our dollar will be completely destroyed. So I am curious to see how quickly this plan is shot down by the public, but it all came out so quick today, that investors thought of nothing else to do but to buy. So I believe with the combination of the long weekend, it being Friday tomorrow, and our new "rumored" plan from Obama, it would be good to get me some long positions to try and earn some green tomorrow. But I was pretty surprised to see how quickly my Zecco.com account changed.

If not for the late announcement, I was actually almost ready to pull the trigger on some more shorts. Like I've said before, you never know what's going to happen during the day, especially with this new administration. I had a feeling they had something up their sleeve, as a big selling day for today would have been a bad sign for the markets.

Everyone was surprised to see the market down so much with the, what many thought were "positive, numbers" for retail. A .9% increase reported compared to the -.6% that was expected. However, there was some very bad employment data that came out to quickly kill the optimism. Plus, remember the retail sales is a measure of the total receipts of retail stores, this is not the bottom line. I am more interested in the bottom line of retailers, which can't look pretty. Think of all the liquidation sales that are going on this month and that were left over from the holidays. Everything is on sale. So, indeed, total sales may be up, but I bet you the bottom line or net income is looking pretty scary.

So indeed, I switched it up a bit today and it will be interesting to see what tomorrow brings. I definitely will try to get out of FAS as soon as I can as I see no backbone for financials at the current time. If there is indeed a rally tomorrow, I don't expect it to last long. Who knows, maybe the reality of nonsense of the plan will catch up to the market by tomorrow and there will be no rally, which is why I'm setting a 5% stop loss. I do, however, see nothing for green for gold as continual printing of US dollars should keep gold firing. Check out GDX's market trend chart, a +100, wow (get your own symbol analyzed for free, all you need is a name and email, Click Here).
See you on the chat, Happy Trading and we'll see you tomorrow.

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The lovely paradox we have been discussing the past few days of "buy the rumor, sell the news" has been getting thrown around the media, saying that this was the sole purpose for the big sell off we received yesterday. Come on...Sure there was indeed some of that factored in, since much of the buying on Friday and Monday were due to the "rumors" of the stimulus and new bank plan. However, Geithner also went up and disappointed Americans with his lack of answers for the direction the Treasury plans to head in these coming months. I believe Americans are slowly beginning to realize that there is a lot more talk with these politicians than walk.

It is a very interesting week we have on our hands. After these plans shake out, there is really not much left for the government to unfold. I believe it is after the failure of this next attempt (my personal thoughts, obviously), that we will most likely see a market crash and a new bottom set. Investors are getting more desperate and losing more money, and it is fear that usually leads to the mass selling of a crash. As for now, it seems that stimulus hopes was able to keep the market green for today, but once again, we will see how long that green can maintain. We saw the Dow stay below 8000 two days in a row, which has not happened in a while and we’re heading into retail sales announcements for tomorrow, which could be pretty bad.

Strangely enough, there has actually been a reduction in shorting the retailers going into the announcement tomorrow. It seems as if some people feel that they are low enough and don’t want to gamble with them anymore. Shares short in Wal-Mart (WMT) were down 21% to 40.3 million shares. The short interest in Target (TGT) lowered 15% to 39.1 million. Shares short in Home Depot (HD) were also off 8% to 59.8 million. In addition, the short interest in Johnson & Johnson (JNJ) fell 24% to 25.6 million and shares short in P&G (PG) dropped 17% to 30.3 million. Shares short in Coke (KO) lowered 20% to 20.5 million.

The short play on financials was a mixed one. Short shares for Wells Fargo (WFC), were off 11% to 111.7 million. However, the short interest in Citigroup (C) was up 11% to 181 million. GE’s (GE) short interest were higher 17% to 168 million, as it has had increasing concerns. Below is the market trend analysis on WFC (get your own symbol analyzed for free, all you need is a name and email, Click Here).


So indeed it does seem that there was some money moved out of the short side for the time being, but this does not affect my desire to remain mostly short right now. As I did not make many moves today and I still remain mostly in cash and in shorts, I am still waiting for the time that looks good to move in more. I think retail numbers have the potential to be disastrous. If by chance this number does go overlooked, thanks to more bailout fluff, I would expect it to catch up with us much like unemployment did. So, if we stay green tomorrow, shorts here I come.

The government reached an agreement on price for the stimulus at $789 billion. They expect this powerhouse package to create up to 3.5 million jobs over the next 2 years. When doing the numbers, that means that for every position, it averages to be $223,000 per job. Sure, this number is to be over a period of time, but I think there are a lot of Americans who are willing to work for less than $60,000, let alone $223,000.

Also, the government plans to have their plan of new “transparency” with the banks. Beginning next week, the top 20 financial institutions will be submitting a monthly TARP form, hoping to shine light of how much money they are receiving and where the money is going. I know they think of this as a transparency play, but this can also be a bad move by the government. I don’t know if the public is ready to handle some of numbers these banks are going to throw out. It could just make matters worse for banks and lower the consumer’s confidence. So we’ll see how that goes. Below is an example of the form they will be using.


So, there still seems to be more uncertainty out there. The markets are still very vulnerable to violent movements either way. The day panned out much the way I expected it to, however, I did think financials got a bit more love than was due to them, and I was bummed to see SRS end in the red after the strong start this morning. That is slowly becoming a trend for SRS… Buy before close, sell in the morning. So tomorrow will be interesting. I plan to get into more shorts, whether it is red or green, pending some new announcement.

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. Find me on chat tonight and tomorrow, Happy Trading.

PS – I’m loving my Gold right now, and inflation isn’t even here yet! (GDX, GLD and DGP)