RiskAverseAlert

Options Trader Monday Outlook: Stuffing the Futures for Thanksgiving

Regarding CME-driven surges, I think what one must appreciate about these (and you more or less allude to this) is that the interest behind it is stuffed with inventory it wishes to unload. Probably the greater hope is a wider interest will develop among money managers, precipitating follow-through buying on increasing volume. That this is not occurring presents a risk that those who supported the market during the first three months of this year (as witnessed by a spike in the volume of shares exchanged) eventually will become the very element whose actions lead stocks to "fall of their own weight."

Tuesday Outlook: Commodities, Global Markets

"Is the recent downturn in volume because Goldman’s computers were shut down for fear they were compromised?"

No. Volume is turning down because pigs really do get slaughtered. When, in fact, equity is dead money, what do the masses who got caught last year like a deer in the headlights do? THEY HOLD! Fantasizing that the status quo of the past couple decades will somehow soon return, weak hands hold, hoping to recover from last year's whipping. It is not gonna happen. Wall Street's credit bubble has popped. The best that can happen from here is that, the lender of last resort is able to control the bloodletting. Uncle Sam certainly CANNOT inflate the credit bubble with such vigor and reckless abandon as Wall Street before. This ALONE is critical to a return of the status quo of the past couple decades. And it is not gonna happen. Indeed, it CANNOT. Yet still weak hands hold, hoping for recovery.

Commodities, Global Markets

Equity is DEAD MONEY. Stocks don't need volume to decline. They can fall of their own weight. And with a mountain of debt needing servicing ... and the physical economic capacity for doing so collapsing ... fall of their own weight they will.

The stock market is nowhere even close to bottom. Yet to sweep over the lower Manhattan casino is ... capitulation. This is the big picture in a nutshell.

Returning to Thursday's throttling ... the best those holders of bloated, over-priced inventory could do was cease offering their shares for sale. No one was buying. A disaster in waiting is all this revealed. It may take some days/weeks for truth to sink in. Yet when it does, we're likely to see an avalanche rushing toward the exits...