ARE STOCKS OVERBOUGHT?
Once again it is time to re-visit the world's greatest market chart. This tool has predicted another significant turn in the market dead on. I have said this before and will say it again, this chart just blows my mind. To think that what the Commercials are doing in the Eurodollar in net position today, will determine almost to the day what the stock market will do one year from now, is absolutely mind boggling. However, if you look at it can you point out one juncture on this chart where this has not been basically dead balls accurate?
I am done questioning this to be honest. There will be a time when it will stop working, and that is the time when we need to start moving on to the next thing. For now it shows a strong rally through the end of the year, so that is what I guess we should expect. On a short term technical basis, I still show us being in a down trend. Those bands I use, which work pretty well but are not perfect, still say to look to short this rally. If we continue up, we will get above those bands and it will shift to a buy the dip. I know of no perfect trend change tool, and when the market is choppy there can be false signals with it just like anything else.
It appears my decision to cut off my Bond short was unwise. The PFG wipeout has forced me to change what I am doing some for now, just to try and chip away and re-build things. As a result I am trading in shorter time frames with closer targets. Once I get going again, I will be holding things longer, and be more willing to let a few grand go in profit in an open trade, to try and catch more. For now I am going to just live with trying to hit a ton of singles. I am up 10% in the last two weeks, so it is working out ok thus far.
It appears to me now that the web of deceit from Wasserman is as most of us expected, pretty deep. It is going to take a very long time for them to try and track where the money went. They found a insurance policy he bought seemingly directly out of the seg account, that has a value of $1.3 Million that is being cashed in. He apparently bought it enough years ago where it has accrued that amount of value. This of course is proof this has been going on a long time. Talking with a few others yesterday who are trying to investigate this the trail is a long one. I think it is highly likely that the amount of money that will be spent will exceed what they find, and we will get nothing. If they bill at $650 an hour and work on it for a year, you can do the math yourself. The legal fees are going to take up all of what they will most likely find. The attorney's will get paid, and we the victims get screwed. It is the American way unfortunately.
I don't see anything immediate to do here. I have an order to short the Russell today if we were to break down. We are pretty extended upwards here, so it is hard for me to get too excited getting long the indexes even on a short term basis.
Since I went from being a Pro to a Joe, the following sign out seems appropriate,
Average Joe Out!