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Thursday, July 1, 2010

End of Q2


by Larry Levin

Today was a rather slow day, until the end was nigh. When there was approximately one hour left in the day, traders realized there was also only one hour left in the month...and the quarter. Time was tight and orders had to be filled; however, there was a lack of buying and buying is the norm going into a quarterly close. What was happening? What's more, the S&P had hovered near the 1040.00 level in the cash market for nearly two days...until there was one hour left.

Yes sir, when the money managers and banksters collectively looked at their taxpayer-funded Rolex, Panerai, and Cartier watches they said, "Uh-oh, where's the calvary? If 1040.00 is breached we're toast; our stops will get nailed." Nailed indeed! The market was once again sold-off to new lows that almost extended yesterday's low a further 10-handles and all came with one hour to go in the day, the month, and the quarter.

But don't you worry! Tax-Cheatin-Timmy at the treasury, Benron Bernanke at the Fed, and Barrack Obama at the White House are on the job and they'll have it all "Keynesianized" and fixed up before you know it. Well, let's hope "before you know it" occurs quickly, as in before these clowns put this mighty country into the economic wastebasket of history.

There were three more data points today that once again went 3 for 3, which is to say they were all terrible - AGAIN.

1) MBA (home) Purchase Applications were much lower than expected with a negative reading of -3.3%. Bloomberg said...Purchase applications for home mortgages weakened again in the June 25 week, down 3.3 percent and remain near 13-year lows. The weakness points to major trouble for June home sales which don't appear to be getting any lift at all from record low mortgage rates.

Yes, applications to buy new homes are still falling despite the tens of billions of wasted taxpayer dollars. Who wants to bet that Congress will extend this failed program at the behest of Tax-Cheatin-Timmy, Helicopter-Ben, and the White House?

2) The ADP employment report was a shocker: just 13,000 private jobs were believed to have been created in June. Of course, with the BS coming from the BLS, this could be way off. Since the ADP report uses actual data from actual companies and not made up huff-puffery like the BLS, the nonsense from the BLS is used. Said another way, the ADP data is too real and cannot be manipulated like the "guesswork" of the so-called geniuses in the Bureau of Labor & Statistics.

3) The Chicago PMI did not come in at 59.7 as expected, but 59.1. Although it is another miss, to be fair a reading above 50.0 is considered growth.

If Friday's monthly jobless data is bad, expect the trio of Keynesian idiots at the Treasury, White House, and Federal Reserve to "float" the idea of MORE stimulus (read: waste more money!). "Floating" the idea will certainly be little more than smoke and mirrors as the plan is already surely in place. And what better way is there to get what you want in Washington than a well-timed "emergency?" Hmm, is the current stock market slide ringing any bells?

If the Fed engineers QE2 and the White House engineers more wasted porkulus spending, even John Maynard Keynes will roll over in his grave in disgust!




Previous Day's Trading Room Results:

Trade Date: 6/30/10

E-Mini S&P Trades*
(before fees and commissions):


1) VA sell @ 8:35am at 1035.75 = -0.50 (1 lot)

2) OTF buy @ 11:38am at 1041.25 = -1.00 (1 lot)

3) Algorithm positions (14)

4) “Reading the Tape” positions (6)combined Secret’s, Algo, & “Reading the Tape” total… +7.50




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