Mr. Market has been testing the patience of bears to the utmost, although this bear is determined to remain short the E-Mini S&Ps from near the last record high. Still, the broad averages seem incapable of selling off. Each morning, they open down simply because DaBoyz have pulled their bids overnight until sellers are spent. But that's about as low as stocks go, and for the remainder of the day there is a steady ratcheting higher, punctuated by short-squeeze spasms if there is any news that is even remotely bullish. From ZeroHedge, we learn that short-covering bears are not the only buyers: "A 'Cluster Of Central Banks' Have Secretly Invested $29 Trillion In The Market" is the latest expose. Read it in its entirety by clicking here.
Friday, September 12, 2014
DJIA – Dow Industrial Average (Last:17025)
– Posted in: Current Touts Free Rick's PicksWhen a stock or an index takes a wicked dive, it often occurs after the particular vehicle has marginally exceeded some prior, significant peak. 'Everyone' turns bullish on the breakout, including bears prepared to cover on a hair-trigger signal, and that sets up the haymaker. Notice in the accompanying chart, however, that the record high recorded by the Dow on September 4 has led to no such plunge. The high exceeded July's record peak by 10 points, and that should have been enough to get bulls' -- and bears' -- juices flowing. Instead, we've seen only a moderate pullback since then, leaving bears very much on the hook. We could still see a collapse from these levels, particularly if there is unsettling news. But for the time being, bears shouldn't get their hopes too high. We are short the Diamonds via some out-of-the-money put options just in case, but we may have to reshort if DIA breaks out to new highs. (Note: This tout is being written before Thursday's close, since I will be away from the office later today.)
