No Buy Plays

I have been searching all day for a decent long position for an expected relief rally. I sold my BGU holding this morning when the market broke it's uptrend. I have not seen one bullish play I am confident in, nor do I think there will be one until a possible capitulation. The corporate bond indexes are down 2.5 percent plus today. There is a lot of risk now being priced into fixed income that has not yet been priced into equities. Be very very carefull taking on any new long positions.
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Follow Up

You may recall a few posts ago when I said that GE might carry the markets on its back into the close. It looks like I was right, only a day late. The last 30 min of trading today was very very bullish. The markets were starting to get very oversold. Pretty easy to do when you have 4 straight down weeks. GE rallied 6 percent in the last hour and dragged the rest of the market up with it. I think the first part of next week we could see some good days trading to the upside. I picked up some BGU at the close (leveraged Drexion Large Cap Bull ETF) to hedge against short positions I have (and am still confident owning) in Visa and now Walmart. Oil is starting to show some real strength. I may buy in on the next dip and start selling covered calls on it.

On a side note I am thinking about making some T-Shirts that say "Obama, A Short Seller's Dream Come True". What does everybody think?
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Yellow Smiling Face and Falling Prices

Time for Walmart to start showing the falling price commercials for their stock. Too many people think it is immune to the recession. It's getting some pretty decent selling pressure on it. I picked up some puts on it today.
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GE and The TRIN

I don't know if you have ever heard of the TRIN before? A man named Richard Arms developed it many years ago. It is basically an indicator that publishes the ratio between up volume buying and down volume selling. A ratio above 1 is typically bearish, while a ratio below 1 is bullish. Today, when the market is down 200+ points the "TRIN" ratio is .63. This may be due to the GE activity going on today. The GE CFO was on TV this morning going over the specifics of their balance sheet. There is a whole lot of volume either covering short positions or buying long value today on GE. My theory is that this"up" GE volume is influencing the TRIN to the bullish side of the ratio. It is possible we could see this market rally a tiny bit off it's lows into the close on the back of GE...so watch GE stock today as I think the market tries to go where it goes.
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Oil

If I was a gold digger, I would marry oil. I am very very long oil. More specifically, I am waiting for just the right moment to buy a substantial percentage of my accounts into United States Fund (USO). I like a commodity play better than an oil company. I expect oil companies to be blamed, taxed and punished by the government many times over as oil prices rise. Although I am bullish long term on oil, my goal is to be surgical in my entry. I can see an entry point possibly coming to surface at some in the near future. Today...is not that day...I could be wrong. There are still many resistance levels above oil however, and we are still in a so called "deflationary" environment as the stock market continues to sell off.
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Prediction

GE is leveraged 140 times liquid capital. Dow Chemical has just about every single business unit for sale so that they can aquire Rohm and Haas company. I don't see either company's chances of raising money from a business unit sale very good in these markets. I could see either company getting a bailout at some point in the near future. Gosh I am so negative. I do see some hints of positive buy signals from Bank of America again, though. Nothing sure, but something to keep an eye on.
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Get Used to This People

Last week the feds gave 25 billion dollars to Citibank. They also began negotiations for 18 billion dollars to the league of companies that manufacture parts for the car companies. The latest? 30 billion dollars for AIG. My prediction...amidst all these bailouts there is not yet one that fixes the problem. Until that happens, have fun keeping track of all the bailouts that have occured, because they will continue to be diluted by many more bailouts.
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