Sean’s Rant

There is a new witching hour in the market. Its 12:30 PM. I’ve watched it happen a dozen times now. I hadn’t tagged the exact time though until now. its 12:30 PM EST. Watch it if you don’t believe me. The market lately is no longer full of investors. its full of traders and its like a shark tank. The overall market volume lately is fractional and the majority of trades being done are by day traders.

Jim, 

Boooooooyaaaahhhh from Omaha, NE!

I am curious about your recent rant on the Ultrashort ETFs manipulating the market, and your woes about this.

Let me rub this in a little bit… Booooooyah!

If you look at the track record of market behavior around this time of year, the recent rally represents the trend upward the last week of November. Also, we had just had a large downtrend, allowing for a large rally. We will likely see a down week of -500 points or more unless some major good news comes out, like the recent statement of Treasury Chairman Paulson to make a massive capital infusion which almost immediately lowered Mortgage rates. The day that this was announced the market was basically flat. This is because the market was due for a downturn to balance out some of the rally it had just experienced. When Paulson made this massively bullish news, it balanced out the activity for the day and left the market essentially flat. 

Bear Market Rally

I’m still bearish in the mid to long term, but tomorrow could show us a bear market rally, which should be sold into on its highs. After taking profits turn around and start shorting again.

Overall we still have a ways to go before any consideration should be taken for the equity market.