SeeTheLight

Friday Outlook: Commodities, Global Markets

The Aussie Central Bank raised rates, but that wasn't seen as an end to easy money but a sign of recovery. Everything gets spun these days.

It's pretty clear that this an easy money rally with trading desks leading the charge. Unfortunately for even the most astute retail investors, the first major signals that the easy money is coming off the table likely won't be as visible as an interest rate increase, likely it will be something more subtle like the Fed cutting back on some its under the cover lending programs. And of course it will be lost in the endless spin jobs being spewed out by the MSM.

This is why this rally is so dangerous. It's too profitable to be sitting on the sidelines but at some point someone is going to inform all the trading desks that one of these "buying opportunity" dips is really a feint and then back half of the "W" will begin. Trade carefully and make sure you have a reserve of cash or have some downside protection.

Good Luck all.

Friday Outlook: Commodities, Global Markets

The absence of stick saves and dip buying is very noticeable. The jobs report was worst than expected. I'm thinking we could see another solid triple digit down day on the DOW again. Back to back triple digit down days are something that hasn't happened since this rally began.

Personally while I am already mostly in cash, I think its time to close up most of the long positions and get real cautious. If next week continues to bleed red it would probably be safe to say that recent high was the bear rally top and we may see a sizable correction which of course means it will be time to start looking for good short positions.

Good Luck all.

Friday Outlook: Commodities, Global Markets

Monday might be interesting. Obviously on an options expiry day there is no room for reality. Everyone should be taking this market day by day. I am. Sure we are in a liquidity driven bubble here but I'd like to note the following:

In 1930 the DOW rebounded 48% off the lows without the magic printing press running at top speed (and buying treasuries in a loose attempt to convince us that the Fed is not monetizing the debt). But this time, the Depression-learned Bernanke has it all figured out, he's determined not to make the same mistakes they made back then, he just wants to make bigger ones (albeit in the opposite way).

Our savior Helicopter Ben, is going to build the biggest bubble ever and do it with the Lender of Last Resort (so there will be no one left to bail us out when it bursts). Sure we have retraced 60%, but if this turns out to be the biggest bubble of the them all, it could go much higher. And of course, if he succeeds, the following crash will make the great Depression look like a mild hangover.

But as I said in previous posts, you would be silly not to profit on the way up and the way down, as well as being prepared for the moment that the music stops (QE stops) because it won't take long after that to get new Everyday Low Prices.

Good Luck all.

Thursday Outlook: Commodities, Global Markets

Shanghai is up almost 5% on better than expected lending news; US market futures are green. Looks like Tuesday may have been another dip to buy. Let's see if the bulls are able to grab the reins and drive the markets higher.

Personally I am still fearful (while others are greedy) and even if the market surpasses its most recent top I have no faith in it and continue to sit safely on the sidelines mostly in cash, a few longs, some Gold and Silver and some UUP, waiting to see if reality ever decides to set in.

I can say its difficult to remain disciplined with the casino mentality of the market today. I briefly flirted (in my mind) with jumping into the dash for trash. Thankfully I did not and saved myself some money, a lesson that didn't cost me anything and restored my discipline to be patient. Sooner or later the S&P P/Es will return to the mean (and somehow I doubt that will occur by the "E" actually increasing to reduce the high multiple). Until then I wait.

Good Luck all.