Jon Stewart


On Monday night we had the CNN/Tea Party sponsored Republican Debate. “A truly remarkable pairing, as a fringe often derided incopetent bunch of yahoos was granted legitimacy by pairing with the TEA Party.”

How totally incompetent was CNN.? How horribly low and devolved into spectacle has news become? Watch the Jon Stewart video Their debate rivaled The World Wrestling Federation in hype and spectacle.

Our mainstream news media as devolved into a very laughable parody.



Obama’s Job Program

This week many of you made some excellent comment on Obama’s job program.

  • Content credible
  • He proposed how to pay for it – again credible with more to come next week on cuts to entire budget.
  • It’s political – Obama  intends to run on this.
  • Republicans have no plan or ones that include cutting taxes on big business/wealthy, and no specifics on deficit reduction.

Relativity – We have a patient whose dying and Obama’s job plan does offer  the patient  a pint(s) of blood. But the problem is that the wound is open and bleeding.

We have a dysfunctional shadow gambling/financial system that need regulating and regulators. This shadow system is now impacting Europe. Major US companies continue to bleed US jobs overseas.  Until the wound is stitched and closed the prognosis – negative.



KISS & Stocks

(Keep It Simple Stupid)

If you don’t understand a term look in up at dictionary



Index Percentage Volume
Dow +1.66% down
NASDQ +1.34% down
S&P 500 +1.72% down
Russell 2000 +1.33%-


Market Analysis

Focus on TechnicalsFundamentalsHFT’s

  • Another HFT  algorithm induced low volume rally as Europe played kick the can down the road over Greece defaulting on its loans.
  • The massive, hidden in the shadows, unregulated (Who knows how much each bank’s exposure to PIIGS country debt there is?) $600 trillion Credit Default Swaps (CDS)  market is forecasting doom while the HFT dominated US & European stock markets this week (big rally) forecast sunshineLINK
  • You could trust rumors, politicians,  pundents/bloggers, stock markets, CDS markets on Europe’s debt crisis. Yuck, what a choice. This analyst will freely admit I don’t have the information (its all hidden in the shadows) to even begin an evaluation. I do believe Greece will do some kind of default but far more important — what happens to the financial sector is in the shadows.
  • Trend - Kicking the can down the road is mana from heaven for HFT who can use every news items to execute short squeezes, pump and dumps or catching institutional traders with losing long positions

Investors411 Technical Forecasting Tools.

  • The PCR fell a wee bit 1.05 to 1.02 (Roughly - above 1.25 is getting Bearish and below 0.80 is getting Bullish. 1.00 = same amount of puts and calls. Over last two years the highest for PCR is @1.50 and lowest @0.60 - anything approach these levels shows change likely For more information on PCR LINK)  After three days of major put buying we have settled into two days of basically a neutral. Today’s PCR evaluation still = Neutral
  • Investors411 uses the PCR to measure the path of least resistance for HFT dominated stock market. HFT’s love leverage and if there are more puts then calls, there is simply a supply glut on one side that forces a move to the other. See above.

The McClellan Oscillator

  • (MO) rose to +52.51 (Rough estimates =-30 somewhat oversold, -60 oversold, -90 OMG oversold & +30 somewhat overbought, +60 overbought and +90 OMG overbought) MO is somewhat overbought and approaching overbought. Only 3 times in the last year+ has the MO got over +80  Each time after that the S&P fell at least 7%   = Bearish/Neutral


Reading The Tea Leaves

Short Term Outlook

days, week+

  • Our forecasting tool are  Bearish/Neutral (see above) - You rather enter oversold markets and exit overbought markets. Advantage to Bears.
  • If the PCR was below 0.80, the Bulls would rule. (See Current Positions below for more)

Longer Term Outlook

month, months

  • Repeat Same old mantraMay 20th forecast still stands. The May 20th summer forecast has come to pass and now we wait to see the Fed’s next move. Add to this Europe is a whole lot worse than previously thought back in May. For the Fed to act significantly – inject more liquidity - I’m afraid we need to see stocks do worse for that to happen.
  • We do have a technical series of higher highs and higher lows build on major indexes.


Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)

  • Tea LeavesAny @200 point Dow rally should bring the MO to or above +80.  Ideally we like a lower PCR. However, this (a potential +200 point Dow rally today) could be a risk on trade to nibble at - GO SHORTUse a leveraged ETF like SDS or TZA or sell some long positions.
  • Monday was a risk on to go long. It worked.
  • If @+200 Dow points today – HTF will have pump this market higher and some technical levels will have fallen (higher highs). Institutions will get excited and buy, then HFT’s will dump it. CAUTIONThis is contrarian advice. Most analysts will see  a +200 point move on the Dow as bullish. Longer term it technically is.
  • Risk on = For those that can tolerate the risk you have a fair trading opportunity – GOING SHORT in this case -. It could be better, even much better, but the tea leaves put the odds in your favor
  • If Investor411 goes short or buys GLD you will see it first in the comments section of the blog.


NLYAnnaly Capital Mgt. Ultra high dividend stock –a @14% dividend

pot of gold

GLD – (Long Gold ETF) Bought at 167.05 - Sold 1/2 for 8% gain. GLD closed at 174.40. Gold is contrarian to stocks and More willing to buy tan sell right now into a stock rally.

Disclaimer I buy everything in the hypothetical Investors411 portfolio. If stock is mentioned and I own it you will know.


Long Term Outlook

(for US stocks only – not our economy)


*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)



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