Sunday, October 5, 2008

A Meet And Greet At Dow 10000?

We are so close and maybe they will tag the level tomorrow. Hedgies that have been trapped for a few weeks will be able to short again even though the SEC told them to pound salt. The London FTSE 100 is setting up for another manic Monday and is down about 160 points as European bailouts are running into problems and are in jeopardy of falling apart. Our markets had a ton of red on Friday and could continue the move this week as we lack a catalyst and leadership from any group.


upsidetrader said...

Hey, Upside,

This might be a bit deep, but...

The SEC extended the short-sale ban for 2 weeks OR until 3 days after the bailout plan was passed.

Perhaps they're expecting a certain scenario of the traders gaming its passage, OR perhaps they've scripted some additional interventions in the coming days??? (rate cut, additional relaxation of regulatory rules, some form of immediate capital injection...)

The market pushed down after the vote, and the news hitting main-street (that I've seen so far) can only be viewed as god-awful. So, I expect acceleration in redemptions in mutual funds this week. Indeed, even a panic gap soon is possible. (If that happens, I will trade it as a measuring gap, not a capitulation reversal because of the news-flow.)

Any thoughts on the scripting theory? Personally, lacking any new interventions, I'm having a hard time formulating any bullish scenarios (and traders usually f up when they can't see both sides)...

Thanks for any thoughts!


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I am a former hedge fund manager, broker and capital markets dude who now trades for his own account. I love what I do. I will try to post some stocks and an occasional chart that looks attractive for entry.I will also try to point out the idiocy of conventional wisdom and the lack of value added by the mainstream financial media. These postings should not be viewed as recommendations.