Marc Courtenay

Are Financial Stocks Preparing for 'The Fall'?

I did want to disclose that after I wrote and posted this article, I decided late Wednesday (right before the closing bell) to nibble on some shares of Citigroup (C) at $4.12. Today I'm glad I did since C has broken above its 200-day Moving Average. My thesis in the article still stands, and if I get my 20% or so profit on C I will take my profits with gratitude. Knowing when to sell is harder than knowing when to buy in my estimation.

Are Financial Stocks Preparing for 'The Fall'?

Energy's contribution will play a role. But most of all, it will be led by the media and the ongoing promotion of this rally by the most influential voices and the talking heads. The final role is also the most important one. The exchange specialists and market insiders want to make a wonderful profit on their stock inventory (don't we all) so they will rally stocks higher and higher to bring in more buyers. Then, my guess is, just when prices stun everyone on the upside, they will begin to short the market (perhaps beginning with the financial stocks) and set the stage for the "Big Fall". This is may take another 4 to 6 weeks, but it could happen sooner.


On Aug 19 07:29 PM Paul Z wrote:

> Marc,
>
> I completely agree, overall I've been bearish for the 2nd half of
> this rally, rubbing my eyes the entire way. I started thinking the
> beginning of the bear market was this week, and it may be.
>
> ....until this morning when I saw crude jump today on lower reserves,
> thus leading the market up today. Do you think it is possible that
> the final jump before the next big correction will be led by energy?

Are Financial Stocks Preparing for 'The Fall'?

As usual, Mad Hedge Fund Trader, your comments and perspective are appreciated. Right now the media and the operators of the DJIA are trying desperately to get investors to buy long for awhile longer. At least that's the appearances. At some point I anticipate a sudden, dramatic and unexpected reversal that will bring the big cap stocks down to much more attractive prices. That will probably happen sooner than later.


On Aug 19 03:14 PM Mad Hedge Fund Trader wrote:

> zxcb. There has been a lot of chatter in the blogosphere lately
> about the eerie and frightening similarities between our current
> global stock markets and those of 1937. Look at the great chart below,
> which I obtained from the ace quants at charlesnenner.com/.
> After a ferocious dead cat bounce and a tortuous period of sideways
> consolidation, we break down to a final Armageddon sell off. Top
> technical analyst, Louise Yamada, has also been highlighting this
> risk, and many big hedge funds are positioned accordingly. I believe
> that markets will always do what they have to do to screw the most
> people, and this would be it in spades. Imagine trying to trade the
> tedious 500 point range for six months, only to see the indexes drop
> by half and volatility double. You can kiss another generation of
> traders goodbye. Whatever you do, don’t short volatility here in
> the mid twenties in mid August.

Are Financial Stocks Preparing for 'The Fall'?

Welcome aboard. When I pulled up my own article from the Yahoo! Finance page for Citigroup I also got a sudden "pop-up ad" that my blocker blocked and it triggered a scan by my security software. I don't know how these desperate scoundrels attach some nuisances but it happens. It sounds like you are being cautious about your investments and approach to stocks. This is very wise. I'll be watching C with you to see how the exchange specialists, the Market-Makers, and the other "Big Players" you mentioned manipulate C and in which direction. Please let me know if you learn anything significant about what is currently is going on with C, but the most important piece of evidence we can be looking for is big blocks of volume at strategic times during the day, at least in my opinion.


On Aug 19 04:35 PM Cabdriver wrote:

> Its disconcerting that I had to reload/start over this page 3+ times
> because of advertising/popup/lies about the state of my machine.
> I just signed up yesterday, was refered to this article by updown.com,
> & some advertiser has to play games with me. I hope this doesn't
> continue lest I resign just as quick.
>
> Back to the article, interesting, but not one mention of the "Big"
> players; the Fed & that Prince [Aliweed I think, at$4 if memory
> serves, is still abuck below what he bought at the last time we went
> through this with the banking sector aka S&L "crisis"]. As a
> relative newbie to the market, I'll consider all the info provided
> in addition to the history. As for "cheerleaders", well those of
> us that are "retired" understand the motivations of fellow retirees,
> like the other banks [I'm looking at you PNC] there was a big opportunity
> to profit when "others were losing their heads", I welcome any time
> I can double my money either by folding it in half or siding with
> the Fed for a short term. Is "C" another, I'm too conservative &
> I don't think anyone has a handle yet on what the short term fixes
> will "yeild", though I am very curious how folks intend to "repair"
> Citi 1st before I'll focus on the charts/price/ect. If anyone has
> more info on the overhaul, I hope they bring it out into the open.

This Advance Will Be Measured in Days, Not Months

I agree with your comment. Some kind of low will probably be put in between now and November, and a summer rally might continue first. Be ready for some sharp, unexpected "manipulations". Bill Cara's modesty is amazing and certainly fun to read.


On Jul 17 10:02 AM predictorman1000 wrote:

> Ahhh. Tech Bubble stories. Haven't heard those for a while. My own
> story- moved from long to short in April 2000. Good call, right?
>
>
> Wrong. Some might remember that that most of the big names kept going
> up all that year (vs the "pure" dot coms falling apart). I was losing
> big money, doubted myself, and went back to long. Also a mistake.
> Lost every cent I made in 1999 and then some.
>
> No matter what your belief in 2009 company/market fundamentals or
> US/world economic fundamentals, they have no relevance in this market.
> It's all sentiment- piles of money that some days the people with
> their fingers on the trigger are feeling good, other days they're
> hearing "know when to fold 'em" in their heads.
>
> My belief- rally through the summer and go lower in October (but
> not to new lows).

Top 12 Indicators That the Economy Is Still Bad

Thank you Larry, and I appreciate all the feedback and interesting comments an article like this generates. Your comments are read by the authors and we learn a great deal from them.


On Jun 18 11:22 AM Larry House wrote:

> Thanks for an interesting read, Marc. That is more than I can say
> for many posts.

Will Earnings Season Test the Market Rally?

Today was no surprise but the rest of the week might be. Jim Rogers did an interview with Barron's recently which is well worth considering. I'd like to be optimistic from here but realism prevails.
Thanks for your comments.

On Apr 20 07:36 AM Cetin Hakimoglu wrote:

> Earnings season so far has been a success. Large cap tech crushing
> or beating estimates. GS and Wells Fargo, too. The fundamentals are
> improving.

Will Earnings Season Test the Market Rally?

I give up. Please share that answer with us and thank you for your comment


On Apr 20 12:52 PM Mad Hedge Fund Trader wrote:

> You bet! Last year was truly the annus horriblus for the Fortune
> 500, which saw profits plunge from $645 billion to $99 billion, the
> worst performance in the tabulation’s 55 year history. AIG alone
> lost $99.3 billion, taking it from number 13 on the list to no. 294,
> made possible I’m sure only through some spectacular accounting fiction.
> Many once mighty names were struck from the venerable list, including
> Lehman Brothers (seekingalpha.com/symbo...), Bear Stearns
> (seekingalpha.com/symbo...), and Anheuser Busch (seekingalpha.com/symbo...),
> to be replaced my new risers like Polo-Ralph Lauren (seekingalpha.com/symbo...),
> Master Card (seekingalpha.com/symbo...), and Visa (seekingalpha.com/symbol/v).
> Only three companies have shared the number one spot since 1955:
> Exxon Mobile (seekingalpha.com/symbo...), Walmart (seekingalpha.com/symbo...),
> and General Motors (seekingalpha.com/symbo...). Guess which
> one made the top this year?

Cramer's Stop Trading! Dow Doomsday Scenario (3/6/09)

It's interesting to see how much publicity Cramer still evokes. His track record is questionable, but he is very well "connected", especially to the Goldman Sachs crowd. I'm still hoping for a Spring Bear Market Rally and then I'll be heading for the sidelines expecting that "the worst is yet to come". I hope I'm wrong and Cramer is too.