understanding the psychology of behavior

JCG to be above 45 by December.  Even though I made a lot of short-term accurate calls since the july prediction, this was the last post SeekingAlpha published from my blog.

I don’t think SeekingAlpha likes me anymore , as they are not publishing any of my posts since. But then again, I have been posting more technical stuff, and despite my accuracy, they are not into that sort of thing. The irony is that I have noticed this Blog getting more hits, and consistent hits since July (as many hits a ‘long-tail’ blog can expect without really advertising, and posting anonymously ) despite not being published.  Which means you guys reading this thing like my technical chatter and are passing it along.  For that I say, “Thanks”.

Happy Trading.

I thought this to be very interesting.  An Iranian TV program showing sympathy to the Jewish people during World War II. (article)

Whatever anyone says of what this program is designed to do, there is no question art plays a role towards the belief of a people. (And Islamic states understand this very well.)

With the state allowing this program they are allowing their people to have sympathy toward what the program promotes, which will ultimately structure a belief around that sympathy.

JCG produced a really nice quarter today. Actually raised guidance, in the mist of a blood bath retail envirnoment. There was nothing not to like.

Most impressive: 79% of revenue comes from the ‘direct biz’, with a growth of 36%. (In other words, same store sales from JCG is becoming irrelevant.)

My only Negative: Inventories increased by 10% from the last quarter to the current.

As for the chart… if JCG jumps in normal hour trading, as after hours suggests, it will be breaking from its negative trend.

Given Bernake hinted at more rate cuts, the market maybe up tomorrow, giving some wind to JCG’s back.

Got nothing but respect for this management team.

Why do media personalities (aka Cramer, Nigerian… etc) equate solar power with oil prices?

Solar power should be compared to electricity prices, as Solar is used to produce electricity. Unless crude oil is the main source of electricity in this and other countries, then they are right. But this is simply not the case.

The most successful trader playing the residencial subprime/bond collapse has indicated the risk-to-reward for being short is no longer there, on the residential side. (article)

Mr Lahde started returning money to investors from this 1000% return fund stating in his letter, “The risk/return characteristics are far less attractive than in the past.”

So if you want to get in to these type of assessts at a relative bottom, CIM is good way to play it.

I feel sorry for the people of Venezuela. Every day I have been reading about Chavez and his lsolation theme.  Chavez has managed to piss off many South American countries, including Brazil, and cut political ties with Spain and Columbia because he himself was insulted.  (Talk about a selfish act, and a plea to gain support amongst the economically disadvantaged.)

The man is crazy, too aggressive and hurting his country.  Leaders should learn from Google. In fact a PhD student in Management should conduct a paper on how benefit of Google’s ‘partnership’ biz model works so well. It would essentially be a play book from Nash’s principal of equilibrium twisted in mordern/global times.

When the world is global and dependent on partnerships, isolating a country with global players, like Spain, is horribly wrong. 

Here is Mr Market, and what I think it is telling me…

The daily SP500 chart indicates a move to between 1480-1500 as the first level of real technical resistance. The next level will be around 1510. (1510, IMO, is the big one. And do not think the market will break it.)

The SPY is obviously supporting the above thesis:

The SPY weekly indicates the market is bouncing off the current support SMA, and is about to enter a push to 149 via the 14, 28 and 32 SMA.

Supporting any potential move upward is the VIX. It broke from the SMA that has been acting as support these passed few months. As such a push by the markets to the next resistance mark is likely.

The chart that indicates a down day tomorrow is the SH. It is sitting on this few month long support, after not being able to break its now triple top resistance.

All and all the market has room to run, but obvious fluxuations will occur. Like a potential down move tomorrow, hence my Put today.

Upon a market push to 1490, SPY Feb 149/150 puts can be bought. As it correlates with a few daily resistance marks, and a seemingly strong one via the weekly.

Upon a market push above 1500, the trend states around 1510 (151/152 for the SPY). At 152 for the SPY, the 152 Feb Puts would be a good idea.

For the record:

This bull run is over, it is broken. Things need to rest, reset and then be ready for the next bull run. Right now, the markets are bouncing because of seemingly cheap valuations from a bull market mentality. Once the bear mentality sets in, the majority of the SP500 earnings estimates will come down. (I know I focus a lot on charts, but nothing beats the fundies… do not lose sight of the fundies here.)

Within this bull run, everytime we came off a real corretion (hitting the 320 SMA) there was a very real economic reason that made us run. Today and yesterday the markets did not see any real reason. These bounces were purely technical, which has a lot to do with the current psychology of the market players still thinking the market is in bull mode. This is not a reason that can sustain a solid bull run.

The market is acting nice, and I hope it continues. But many of the stocks I follow are hitting their ’sell’ levels.  For them to have started to reach their levels so quickly is not too reassuring.

The market is still oversold, but it is oversold and still weak (despite today).  I started taking out Jan puts, for any weakness we might see (only protective position). 

I will post detailed charts of the S&P 500 to indicate where resistance will most likely be seen, and where stage put entries can be made. 

FYI: I unloaded my short-term option trades today as they have seen my price target, but not my long-term holds… yet. So I am still very exposed to the upside, w/protection.

This current riot is like the millionth this year in France.  If he really wants to stop the riots, reforms are needed to properly assimilate your immigrant citizens.

Doubt that will ever happen, as most of the native french can give a rats ass.

Of the many things I love about America, the most impressive is its ability to quickly assimilate a people… for the most part anyway.

So, while reading the ever optimistic Bill Gross via a Fortune article he pretty much states to invest internationally with strong economies and currencies because of the potential crappiness of our banking system.

“The shadow writes, and having writ will move on to new sources of wealth creation in faraway corners of the globe. Go with it”

While reading this article, I kept thinking of an earlier post I wrote about US companies benefiting from a weak dollar and strong global economy. See post. All these plays are still valid: KO, NYX, MCD, GOOG, GS (although this is inlcuded in Bill’s shadow world); and stocks that I left out… MA, MSFT, CSCO etc.  Obviously this goes with his theme, and an easy way for US ’small boy’ investors (like me ) to invest globally.

For the record, I do not think our banking system is crapy. I think it is innovative and certain use of derivatives are needed to provide the flexability required in today’s global economy.  There just needs to be discipline. Credit agencies need to mean something, as well as checks and balances at the consumer level to prevent fraud, so that the investor level can have confidence and the needed data to provide money.  But obviously much smarter and proven people are calling the system crap, in a time of crappiness, so I don’t expect my point of view to mean anything.