User 149022

Friday's Turnaround: Raid on the Shorts

I am short the march 1333 S&P Calls. I left the positions intact, because I was unable to focus on the mkt immediately. having other concerns for an hour. I will probably continue to do so (although I may day trade hedge them), because this "rally" had all the markings of a bucket shop run.

All the smug gloaters who were able to scalp a few tics on this run should be commended for their short term prowess (I used to be a pit trader myself), but you are missing the point of what he is saying.

When the market is subject to irresponsible manipulation by a few brokers of information, market efficiency and reliability dies, taking trust with it, and all you have left are scalpers.

Have you ever been in a market where liquidity has dried up because no one wants in? I traded for a short time in the Kansas City Wheat Pit. It was like a neighborhood poker game in those days. Money went from one guy to another, but at the end of the year, most guys were flat. We had to look to bonds, currencies and SPZ to make our money (of course, this is no longer the case in this, or any other ag market).

Congrats to the longs who made money. I would have bot the underlyings myself for the afternoon had I been in front of the computer. But you need to hear what he is saying.