Just for fun I will do this post expressing my inner monologue about things for tomorrow and this week in general. Before I get to that, there is one point I want to make. I have mentioned at some point an extraneous catalyst would need to occur to create any meaningful correction in the market at this point. Tonight there is a story out about another back door deal with unions to exempt them from taxes in the new health care bill. It is possible that at some point there is going to be some backlash that gets to the point of violence. I really think they are going that far, and it very well could create this catalyst. I don't think this is really legal under the constitution, but Barry owns the courts now, so they can muscle them to shut down the lawsuits I would imagine.
However, they are doing all this manipulating with stock prices, it would be ironic that over manipulation of something created what they are trying to prevent. What this catalyst could or might be if it ever occurs is anyones guess, but this one story tonight struck me as one that will likely enrage the public more than any other. Unions have killed this countries manufacturing and the socialists now are trying to bring them back. The very first thing I would do if I ran a manufacturing operation would be to move it out of the US due to unions, and of course that is what people are doing. This move to try and bring back unions is beyond belief, he is far from this great genius he is proclaimed to be.
Now to the inner monologue.
Here is am shorting the strongest market I have ever seen in my lifetime, what the hell am I doing? Well you are just following your rules, you should feel good that even if this batch of trades fails, you will still have a gain during a stretch when 15 of 18 days have been up closes, and every stock trade you have done has been a short. I don't want to feel good, I want to have better trades than this. Well you have looked for long side trades that meet your rules and have not found any. Of course you haven't, there have not been any pullbacks at all and the markets are outrageously over extended, there has to be pullbacks before you can do longs. Won't you feel like a damn fool if you went against your rules and a decline happened and you missed it?
Dammit I want to compete with the government, at this point they are clearly our enemy. Don't be a wise guy, they can set the rules, and are really tough to beat, they have alot more money than you do. Besides you are not competing with the government you are following your rules and that is how you will win in the end. I want to win now. Watch that emotion that has been the end of many of your friends who have been too aggressive. Stick to what you know and follow your rules.
Well here we are with another joke, a down move in the night session. At what point does the PPT reverse this. It is on light volume and a marginal news story, so when you wake up you know if will be big green in the indexes just like it is every day. Well if today's lows go, we would be looking at an outside bar going on the downside and the oscillators are diverging isn't that an entry. Well of course it is so place the orders but make sure to adjust the size. You already have that crappy Russel short on and this is essentially a highly correlated trade. Make sure your total risk between the two does not exceed 2%, ok orders placed accordingly. You will probably get stopped out due to the normal overnight upmove but just in case you don't make sure you know what stocks and etf's you want to play along with the NAZ if that triggers.
So there you have it, a synopsis of the thoughts of someone actually trading and evaluating what is going on. Of course the key is to stay centered. This is a difficult business and there are periods that do not go well, this week being one of them for me. You have to keep an even keel, and stay focused on doing what you do.