Since the last FED meeting I have been getting an increasing "feeling" that we are headed for a major drop. I went into cash after that meeting and am still in it.
The way the market is behaving is wrong on so many levels. I have never really seen this level of fear before in the market. Good news does not lift the maqrket while bad news brings the market down hard. The FED and now government (with Bush's remarks todayt) is showing with every passing day that they do not get it nor do they understand what "it" is. Maybe it is them being out of touch with the middle and lower classes. Illegal Imigration and out sourcing are some of the problem. Now the jobs report shows the last leg of the economy has been upturned. First homes, then credit, now jobs. Today's action was very worrying on many levels. Any thoughts? The biggest gainers over the last several months like Appl, Goog, nvda, gme, Rimm will take the biggest hits.
Is there any "good news" that is coming down the pike? Earnings are coming up maybe that will boost the market or possibly the FED.
Be careful out there. Now is the time where things get dicey for the long term holders. This is where panic selling comes in.
Personally, I don't think it's going to be as much of a price war as a differentiation of experience. The weak mkt conditions may allow it to fall to the $17-19 range on pullbacks but I think it will trend up to the mid $20's over the next yr and the high $20's to mid $30's over the next 2-3 yrs. JMO
Unseen, that jobs report is what finally has me worried. I still like the VG industry and GME, but nobody wants to be riding down with the market. However, I have so little money in it, it does me little good to get out now. Guess we'll see how it all unfolds.
It's kind of depressing to see it chug its way upward for a month or so and then lose it all in about 3 days. I don't think GME tanks by any means, but if the market continues to fall with recessionary fears, GME is not invincible. I, however, do think when some of the major fear has played out GME will start climbing back up even if we're in recession and the market is flat. I think this b/c the VG numbers and GME numbers will still be good, giving investors reasons to buy/own GME. So, I'm holding even if I have to hold through crappiness until things get settled. Then, if I feel it's low enough, I'll buy more.
The jobs report was bad. No question about it. I'm not good at holding in a downturn. I usally end up selling at the bottom when I try to hold through a downturn. That's why I sell at the first sign of a downturn (I know I'm going to sell sooner or later so I sell on my terms and not due to fear/pain) There is a downturn coming. It may be small if the FED "gets it" or it may be huge if they don't. The market over the last several months has always been about the FED. I believed that as long as the FED "got it" the recession/depression could be avoided. The last 2 FEd meetings have shown that they don't. Now the numbers are starting to show the effects of the FED being clueless. They tightened too much too fast. Now they are cutting too slow and too little. Unless they change views, the market will flounder. The economy is a different matter but the market will suffer for the FED's cluelessness. GME has major gains in its stock price. If the market tanks GME will tank more for that simple reason. People will take profits off the table. Yes fundementals will help it in the long term but the short term will be profit taking driven.
For once Jarhead, you seem to be catching on, who says Marines cannot learn?
I own SKF and SRS. I am short about 4 stocks. I expect the US market to sell off, but I think it may happen quicker and harder then even I expected. Black Monday?
For morale Ron Paul with Jim Cramer:
Also Ron Paul now has $20 million and more donations from the military then any other candidate. Why not get on the right team?
"I have never really seen this level of fear before in the market."
--> Look back to the dot com crash. Big time fear. You remember that.
--> You know I'm always good for a few thoughts lol...
Unfortunately, the overall mkt will weigh heavily on even the good stocks like gme and many of the other VG stocks. This will be a choppy time because as the overall mkt trends down with uncertainty the VG sector will fight it every time a good report comes out (like the NPD numbers & qtrly reports). The good news is that this should create a very strong coiled spring that will still push these stocks up as the "light in the tunnel" starts to emerge. I'll be selling puts again on GME "if" it drops to the $50-52 range (probably 09-10' $60's). The same goes for atvi if it falls to $25-26 (selling $30 puts).
I'm making speculative option trades as the mkt goes down to position for the overall upside move over the next 2yrs that I believe will be spurred on by another .50-1.0 bp's as well as additional funding cuts in the discount window. The Republicans will be doing all they can iot give an assist as well (I won't be surprised if gas avg's come down and more mortgage relief bills are passed as starters). Regardless, the mkt won't be able to keep the VG sector stocks down as the sector news keeps coming out positively (which it will "IMO").
I'm looking at options in csco, glw, lvlt, amat, yum, and many others. Solar stocks too (if they come in about 20-25%), aapl (around $150-60), and other recent big movers "if" they come in 10-15% more. China stocks too (again, with options "if" the price is right-many are too expensive). I'm already "starting" positions in some financials.
moo, and dba are nice Ag stocks to avg into maybe 1/3 at a time starting after another 3-5% down. They will do good over the next 1, 2, 3 yrs "at least" ("IMO")... I'm in them both at much lower prices but will avg "up" with more on a 10% pullback.
Happy New Year!!! (even with a crappy mkt)... :-)
the fear during the dot.com was different. It was more of "the party's over". today its more like "There is no one on the tiller and the ship is heading into the rocks" A lot of people can see the rocks but it looks like the Valdez Captian has been drinking again. Maybe its just the mood I'm in.
As far as selling puts I don't know. Looks like the market wants to test last march lows of 12,000. Might be better to sell calls.
I'm still on the sidelines in cash. waiting for the big selloff. Thought today might be it but it wasn't panic selling it was an orderly sell-off. Looked like the big money was getting out. Not sure. A long time between now and Jan 30. Too early to go long, too late to short mid term. Quick day trades on the short side might be the best for the moment. I have no faith in the Fed, in our leaders of both parties, or in our CEO's. Looks like it might be a long cold winter. Looking at NG, oil and ag sector for long plays. airlines, homebuilders, consumer discretionary for short plays like SBUX. MSFt looks good long side at this price. GME and ATVI are in a holding pattern no telling which way they break. Depends on the news, the markets, and new releases sell thru.
Staying in CASH, Hell thinking of maybe using the CASH and paying down debt and just staying away for awhile, at least that way if the shit hits the fan I'm good.