-- Posted Tuesday, 23 December 2008 | Digg This Article
| Source: GoldSeek.com
Rick’s Picks
Tuesday, December 23, 2008
“Phenomenally accurate forecasts
Stocks are supposed to waft effortlessly higher the last week of the year, but the buying power just doesn’t seem to be there. So much for desperation’s final fling, a hallowed tradition of Wall Street money managers hell-bent on padding their Christmas bonuses. We still expect a flurry of criminally brazen mark-ups before New Year’s Eve, but it looks as though DaBoyz might be saving what precious little ammo they have until the final session hours of 2008.
We glimpsed pale evidence of underlying weakness yesterday bottom-fishing in the E-Mini S&Ps and the QQQs. A recommendation to buy call options in the latter went out Sunday night, pegged to a mildly bearish target about one percent below Friday’s close. We lowered the target via a bulletin Monday, and bought a January 29 call just as the underlying stocks was bottoming at our target, 29.13. Ordinarily we would have expected the bounce to last for at least 3-4 hours, since it had taken the QQQs four days to reach the target. But we had to settle for a feeble rally that survived barely 90 minutes, and a profit on the option that would not have covered the tip for two at I-Hop.
The Cubes subsequently exceeded our downside target by 39 cents, and although DaBoyz managed to trigger off a short squeeze from those depths, it wasn’t powerful enough, even, to torment bears, much less strike fear into their hearts. As much could be said of the E-Mini S&Ps, which bounced tradably and precisely from Hidden Pivot supports, but not robustly enough to give buyers even an hour of pleasure. Incidentally, we held an impromptu webinar yesterday morning to watch and trade the market as it cavorted intraday. We’ll probably do this again this morning, so if you get bored and want to see how real traders attempt to find real opportunities in real time, join us in the chat room this morning around 10:45 EST. At that time, simple instructions for joining the webinar will be posted. If you don’t subscribe to Rick’s Picks, you can still get a one-day pass that includes chat room and webinar access by clicking here.
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Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Trading in futures and options contract can be extremely risky, and it is possible to lose your shirt before you even realize what has hit you. For that reason, you should consult with your broker as to your suitability to such trading before you attempt it. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2008, Rick Ackerman. All Rights Reserved. www.rickackerman.com
-- Posted Tuesday, 23 December 2008 | Digg This Article | Source: GoldSeek.com
