Really nice intra-day reversal

QID closed just above 36.

I will review where the market plan to go tonight with charts.

Tomorrow's gap prediction has been updated.

Too busy today with the work.

Tiger
at 5/27/2009 04:11:00 PM

6 comments:

  1. TechnicalAnalysisMay 27, 2009 at 4:21 PM

    PPCO is holding pretty well today although the volume need to surge.

    TA

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  2. AnonymousMay 27, 2009 at 4:22 PM

    thanks. tomorrow may be a day for QID and bears.
    ^-^

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  3. Ben KevanMay 27, 2009 at 4:33 PM

    From here to the 11th is going to be interesting..

    Tomorrow we have the MBA talking about delinquencies, and the 7-Year notes.

    If the 7-year notes cause more rises in the 10 - 30 year Yeild you can kiss the housing market goodbye (we have record number of resets coming). If you can't lock in a low rate, then more foreclosures).

    That means the gov. needs to step in again and buy more treasuries (or announce that they are.. do SOMETHING to bring the yeilds back down to keep rates down for at least another 6 months).

    The last time they had a meeting and announced the $300B I bought GOLD right before.. and it SOARED .. that day (and hasn't looked back since). The same may happen again.

    So IMO 2 things can happen:
    yeilds go out of control and equities fall off the cliff
    gov intervenes and buys more treasuries to help housing crisis by lowering yeilds / rates

    either way like i've been saying it's hard to be a bull in this market.

    It's a double edge sword for me, since I'm looking at buying a house. But I will abandon the plan if rates keep going the direction they are going.. hell, I emailed my lender today saying if I can't get 5% without 0pts .. i'll probably stop looking until prices adjust.

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  4. AnonymousMay 27, 2009 at 4:48 PM

    Housing market can not become well so quick. I would say may be 2010-2012..

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  5. Ben KevanMay 27, 2009 at 8:50 PM

    Tiger.. these Ad's are getting insane.. I got interrupted TWICE while trying to write this comment.

    Housing has a way down to go, esp if interest rates go up. There would have to be a correction in price to keep the current affordabile HPI.

    With Jumbo loan foreclosures and commercial defaults coming down the line, all the long term bull hype by media is just that, HYPE.

    1 Block of my FAZ holdings is at 9.15.. And I still with decay think I will see at least 10 for that block. the Direx 3x's aren't made for long term, but I have full confidence it will re-reach the teens.

    Wish I didn't get into QID at 38 and just went all in at 35 / 35.5 .. but the fact is I did get in at 38, but I saw the opportunity and took the opportunity to average down at both 35.5 and 35 flat. If I sell some $38 options which is my highest entry, my break even point will be somewhere in the 34's.. (i haven't done the math).. that's not a bad option .. but not sure I want to tie my holdings up at 38 right now.. I may shoot for $41 options.

    My CMO / NLY options I sold are well out of the money now (sold them when they were at or very near the money (sold CMO when it was at 12.40 for 12.50 strike, NLY sold 15 strike when it was at 14.80's). The premiums were .30 and .40 respectively.. and now I get dividends in 2 more months plus ANOTHER month of nice options (although I shouldn't count my eggs before they hatch).

    I want another nice 8+% day in FAZ then I'll write some 8 strike calls and buy them back on a dip (depending on price movement).. commissions are pretty low.. and if I can even pull anything as low as $30 I will.. since that's realized gains and I can just do it again on a spike (just chipping at the lossses). This is what I've been doing with QID (when I bought, I did a buy write and wrote 38 calls).. tanked.. so I bought them back and nearly $1 PPS less.. now again.. it's going up, and I'm in the position to sell them for nearly .50$ higher then what I bought them back at.. again chipping away at the losses and easily lowering down the break even (although I don't factor those in, since I take those chips aways and put it away for "funny money" like I have my FAZ shares with.

    GLTA.. Tomorrow may be worse then today.

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  6. TigerMay 27, 2009 at 9:58 PM

    Ben,

    I agree. Housing has a way to go down more. That will bring the second wave down in the stock market.

    But not now, may be in July/August ??

    See my close market today for my thinking.

    Thanks for sharing your thought as well.

    Tiger

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