day_trader's blog

As the market continues to struggle to find its footing, I have been focusing my attention to the gold and silver sector which I have been accumulating for the past 4 months.  I want to share a few of these findings with you as I believe that they present a tremendous risk/reward opportunity for the months and years ahead.

I guess everyone, including me, is asking the question, "What the hell is going on?"  Since my last update, not a whole lot has happened here, even though it seems as if it has.  The S&P broke down through its October 10 lows on November 20 and closed above those Oct. 10 lows on Nov.

The odds of a default of the COMEX exchange is increasing by the day.  The spread between paper gold and physical gold has increased at an alarming rate.  Central banks and other bullion banks are expecting a sharp rise in the price of the physical metal, evidenced by the lease rates which have exploded over the past few months.  Short term lease rates are up a couple hund

This morning, the market rallied up nearly 150 points but it was pretty obvious that the lower end of this trading range we have been discussing for weeks was going to be tested.  The market quickly reversed and was sold off hard, nearly 500 points on the DOW intra-day.  Many of the broad market indices breached their October 10 lows, alebeit on dramatically lighter volume.  The S&a

It has been a while since my last post.  You can see that the market is chopping up and down with no real conviction either way.  Volume has been very light as of late.  The S&P attempted to break out but it turned out to be a false breakout within a larger range.  1000 on the SPY was a gap from earlier in October and that was filled perfectly before turning lower.  Earlier this week, the NYSE McClellan Oscillator hit an all time high, indicating breadth exhaustion to the upside and the pullback came in shortly after that.  While the volatility continues to remain high, we are trading within a range and until

I guess the question that many of you, including myself, have today is around whether today's burst was the kickoff of something bigger or just another short squeeze?  It's been a tough couple of weeks and sentiment is in the dumpster but let me tell you why I think this market might finally have some legs under it.  In my last update, I mentioned a reversal in the Dow which needed confirmation to be considered bullish.  We didn't get it.  The alternative was a break below the lows in the Dow at 7866 which would have started a waterfall decline in my opinion.  Nothing is out of the question here but I still maintain that to be a very low probability.  I think the market told us today that it was

Since we put that low in on October 10 and the high in on October 14, the market has been trading in massive range.  The volatility is unbelievable, and the moves down were frightening.  Let's remove any bias here and state the facts.  This is what I see the market doing.

I will be the first one to admit that the selloff that we have seen in the past 3 weeks had completely caught me off guard.  Trying to call this market has been very trying; the volatility has been obscene and almost untradeable.  It is my belief that the market is putting a bottom in here that will be held for at least a few months.  I also believe that the rally out of here will surprise most; it could be a slingshot higher which could eventually find its way into the 11000 to 12000 region on the Dow.

The squeeze is on and its a perfect time to do it.  Light volume today coupled with options expiration week.  Now that the impulsive part of the move down is over, it's time for a sharp snap back retracement to flush the shorts out.  It's also a great time to take back some of the profits that have been made from buying put options.  The Dow Jones was up 936 points, over 10% with the Nasdaq and S&P following a similar return.  The rubber band was stretched beyond belief and a relief rally is in order.

With the extreme volatility in the markets over the past few weeks, I wanted to start positioning myself into some longer term value plays with the lowest amount of risk possible.  Risk management is the name of the game right now and I want to set up the best reward:risk ratio on my trades. 

So here goes.  The stock market has been crashing day after day and the Dow Jones is now at 8579 on today's close, down over 2300 points in seven trading days.  For the third day in a row, the market has attempted a morning gap and failed miserably.  The FED is throwing the kitchen sink at this market and the market is speaking loudly; the FED is too late.  The market is truly setting a new prescendent.  Volume, breadth, and the speed of this move down are all alarming; important support areas are being violated with ease.  The S&P 500 had major support at 1165 to 1175, 1060, and 960, the market didn't even th

Another fireworks day.  The crash update from Sunday was unfortunately the correct call.  However, we did see some interesting action today.  The market gapped down pretty heavy this morning and was down from the jump nearly 200 on the Dow.  This acceleration continued all day until about 3pm w

Wow...where do I start?  Just returned from my "vacation" from France.  I wish it was a vacation.  Watching the greatest level of volatility that I have ever seen in the markets was nautious.  Nearly 5% swings in the market almost every single day last week.  Unbelievable price action.  I am still long but cautiously as the markets look very shaky here.  I was clearly wrong and may use a bounce as an opportunity to clear my long positions and re-assess.  The market has decidedly closed below the 50% retracement levels on the Dow Jones & S&P 500; however, they both remain above the 61.8% retracement level.  The

Just a quick update here.  I will be heading off to France today and wont return till October 5. 

As of 12:45pm, the market looks good.  The Dow is up about 250 points and it appears that the final details of the TARP government plan will be released soon.  The market appears to be betting on it.  Like I said earlier this week, the market will trade within this large trading range until it doesn't.  Until either side breaks, there nothing will be proven in this market.  It may take a couple days to a couple weeks so stay patient. 

The retracement from the top last week has been deeper than I would like to see; however, volatility is extremely high with investors eagerly waiting to understand the details of the TARP program.  The market will not be moving higher in any significant way until the details are disclosed.  The market was wild today; the Dow Jones opened up 120 points and then went flat, then up 100, then down 170, up 40, and then down 170 again.  The market dumped into the close today, dropping 200 points in the last hour.