Morally Ugly

The Brietbart/Sherrod controversy is perhaps one of the most morally ugly examples of what passes for news in America. Brietbart. a major right wing news source/blogger produced a snippet of a speech given by a relatively minor black Obama administration official, Sherrod, supposedly proving she was a racist against whites.

The vast echo chamber of FOX news (From Glenn Beck to owner Rupert Murdoch) & right wing media who is desperately truing to prove Obama is a racist splashed the story all over the media.

Shirley Sherrod after getting hammered 24/7 by the right wing & American media, was asked to resign (thrown under the bus) by Obama administration who along with the FOX & company thought this would distract for the big Financial Regulatory Bill signing.

Turn out when the whole speech is played there is no anti white racism and the farmer  Roger Spooner who is the supposed focus of Sherrod’s racism says -

No way in the world. No way. No way. I don’t even want to talk about it. It don’t make sense. She was just so nice to us as – she didn’t – there wasn’t no – there wasn’t no racism attitude at all in it. Heck no. … They don’t know what they’re talking about,”

The Glenn Beck, Rupert Murdoch tie above was intentional. Because it ties big business with those that spew unfounded hatred. They do this kind of fear mongering because it sells and produces results – both politically and monetarily.

When the Republican Congressman jumped up in the Obama State of the union and shouted “YOU LIE” he was overwhelmed with donations. Like the congressman, Brietbart whose actions are morally reprehensible will flourish.

The lemming like American media and this time the White House rushed to echo another right wing smear. When the truth comes out you hear almost nothing from Drudge to FOX on their rush to judgement. There is one word to describe our right wing, fear mongering hate filled media – Disgrace

KISS & Stocks (Keep It Simple Stupid)

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


Index Percentage Volume
Dow -1.07% up
NASDQ -1.58% up
S&P 500 -1.28% up
Russell 2000 -1.86% -

Technicals, Fundamentals & Analysis

How markets react to news is the key to forecasting direction. APPL is the “darling of HFT/BlackBox traders.” As Paul R concluded yesterday (see comments section) AAPL was going nowhere despite a great earnings report. Good analysis. This was probably due to the overbought (MO near 50 yesterday) nature of the market.

So along comes Ben Bernanke speaking in front of congress and traders focus on the worst of what he has to say = Bearish

US markets fell in increased average volume = Bearish

Mr Softy MSFT reports after bell today

Under traditional circumstances, you’d figure if the 800 lbs gorilla, AAPL, can’t move markets higher then nothing in future earnings reports this month will push stocks up. But with HFT’s dominating trading anything goes.= ??????

Bottom Line = Investors411 is far more focused on overbought/oversold (MO) levels than daily chatter.

Significant Indexes-

  • McClellan Oscillator (MO) fell to +25.52 [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO) LINK. –  & Investopedia on –  How the MO works. = NEUTRAL
  • US Dollar –  The dollar  rose a significant +0.79% [Anything over +/- @0.50 is significant.] The dollar is important  to stocks – Dollar up = stocks down and visa versa. The Black Box traders, have used the inverse relationship of the dollar as a key part of their trading system. Earnings have trumped this indicator for now, but yesterday it looks like this inverse relationship  trumped earnings.  = NEUTRAL
  • BDI The  Baltic Dry Index (Measures cost of shipping – Higher costs good = more being shipped = Bullish. Also good proxy of China.) BDI was in free fall from a high of @4200 to 1700 . This is a huge-60% drop in 8 weeks.  Often a leading indicator for stocks. Here’s a 3 year chart of BDI for context.  A small but important four day rally indicates the BDI seems to have found a bottom — a short term bullish sign. BDI now at 1782 Fundamentally the-58% drop is very BEARISH

Reading Tea Leaves-

Bummer, Just when the MO shows US indexes are almost overbought enough to put the odds of going short (using ETF’s that short major US indexes) more in our favor, the MO falls back into Neutral territory.

Several of you have asked about YOUR stock list. – If/when the MO goes negative (below zero) we should start putting it back together. We will use the old list as the foundation. One major difference this time – Let’s look for more liquid stocks, because those are the stocks that get juiced by High Frequency Trades. This also means that the higher beta stocks (more volatile) are apt to do even better.



The  Positions Section link to latest & former buys and sells  - These are positions I actually own

Updated over weekends Investors411 holds ONE position in SH at this time

As the MO approaches oversold territory will again consider ETF’s that short the market.

StrategyThe same as before - If/as US major indexes become more overbought the more ETF’s that sort the market will be purchased. Starting out with SH. Then the higher above 60 the MO goes, the more SDS (200% short the S&P 500) and other even 300% short ETF’s will be used the higher the MO goes.  See POSITIONS section at top of blog for more.

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