Trading with Jerry Olson

[Jerry Olson]

one week ago

JERRY OLSON'S
"POINT" OF VIEW NEWSLETTER
DATED SEPT 9TH 2007
JOBS DATA WAS THE TRIGGER

Hello out there all my cyber trading buddies from around the globe. It's been very hot here in the east for weeks on end. But the Fall is around the corner as cool breezes and pretty colored leaves change the seasons with new vim & vigor.

The trigger for the Fed to cut rates was the surprise jobs number on Friday. There's always some sort of event, to trigger this or that in the markets, it happens all the time. I was thinking what a good call i had last week saying the Fed Cuts in the headline of the newsletter, but had no clue that the employment report would be that bad. Not only was it negative, but they revised the numbers down for the last 2 months? Why bother reporting anything if their always going to "revise" the number anyway. I do not like this kind of record keeping since these shocks to the markets always end up badly. I would presume that you all now understand the Fed will cut and cut vigorously to help the economy before it really takes a hit. If the employment number was that bad this last month then what's going to happen as the housing market continues to layoff workers and the financial markets start to do the same? I would think the employment rate will tick up to 5% pretty soon and the Fed does not want to see that change of trend. The consumer and their jobs have been the backbone for this ballistic rally off the March 2003 lows. But nothing is ever written in stone for sure everyone. If the markets perception that there is a huge downside risk for corps because the consumer takes a walk in the park then earnings will be downgrade en mass. I think the whole street expects serious weakening numbers from all the financials anyway, but add to this lost jobs and a pull back in sentiment from the very people that brought us to the dance floor and you could see some very negative events down the long road ahead.

However, the optimist part in me says once we get this shock discounted for the next few weeks, and if the bullish percent charts do not reverse back down again, we could see a wild backing and filling situation over the next 4-6 weeks right into the dreaded Oct cycle lows. No one likes Sept in the markets anyway but I'm telling you all the Fed needs to step up to the plate here and now at this next meeting, cut rates, and make a major statement that the FOMC will do whatever it takes to right the potential of a recession looming out there now in the next 6-12 months. Let me refresh your memories about an article i wrote pertaining to Alan Greespan's remarks in Feb 2007 to some business men in Singapore that crashed the markets off the "then top" in less then 7 weeks start to finish. If you recall my insistence that we "buy that dip" because this was nothing more then China selling stocks for no real rhyme or reason, selling first and asking questions later. It created a Global sell off that must have put a broad smile on old Alan's face. Do you all remember what he said? NO? ok I'll tell you, he said there "could" be a recession later this year, and in hindsight this guy for my money strange as he might be, knows his stuff, agree?

So Alan is the Mystic Merlin of Wall Street and foresees serious trouble ahead. That kind of makes you take a step back and think about what the heck is going on underneath the financial sector that the whole world has no clue about. Is it only the FED, that knows? Does it matter to us? Darn right it does because the investing public is always last to the watering hole no matter what. It's tough enough to fight the tape, the trend, the charts etc, without having unknowns drop in our laps "kerplunk" all at once. Look I'm a realist, a trader in my heart. The days of buying and holding are long gone. If you continue to buy and hold without taking profits when they present themselves it's a huge mistake. Unless you're rotating in and out of sectors all throughout the year you're bound to lose all your money. I'm not going to knock brokers or advisors since they have enough trouble to contend with all the time. But what i can say is this, you cannot buy stocks today on fundamentals alone, and if you have not gotten true religion of becoming a chartist too, you might as well turn off the lights folks, because the parties over! There is no perfect science for trading or investing. The risk rewards of this business means you take that trade because all things being equal the reward far outweighs the risk. Let me ask you all right now, are you willing to risk it all right here and now? I'm not that's for sure!

While my internal bullish percents are still ok right now, anymore lopsided moves like Friday and they'll reverse back down again. Are there long side trades to be made, you bet. Oils and Oil services look sensational, Gold is blowing and going too. The sectors currently on the bottom can languish there for moths on end. So for all intents and purposes till the BP's reverse down, the OFFENSE is on the field expecting these wild gyrations as we form the bottoming process. When it stops and begins to move higher with verve and style then we'll add the other half of that sideline cash. Right now we wait and play it safe. We have 7 trading days till the FOMC hang tough!
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the password for this week is***************** benhelpus **********************one word lower case letters
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DJIA---LAST WEEK I TOLD YOU ALL THAT THE McCELLENS WERE HEAVILY OVERBOUGHT AND THE MAJOR INDEXS HIT "R" AT THE 61.8% FIBO RETRACE FROM THE JULY HIGHS TO THE AUG LOWS. SO WE CORRECT NOW AND SEE WHERE BUYERS SHOW UP http://www.buyitbuyitsellitsellit.com/OJ1.gif 13,250 THE REVERSAL BACK UP 12,950 THE SELL SIGNAL

NASD-COMP---A PERFECT 61.8 RETRACE OFF THE LOWS AND NOW THE CORRECTION. THIS CHART HAS NOT TOUCHED THE 38.3% DOWN YET. OTC IS STILL IN O'S BUT I AM WATCHING DAILY. http://www.buyitbuyitsellitsellit.com/OJ2.gif

NDX 100 INDEX---WE CAME DOWN TO THE 20 & 50 DAY MVA'S SO DOUBLE TIME FRAME SUPPORT AND NOW? http://www.buyitbuyitsellitsellit.com/OJ3.gif

RUT 2000 SMALL CAP INDEX---WHEN YOU VIEW THIS CHART NOTE THAT IT BROKE THRU THAT BLUE DOWNTREND LINE A WEEK AGO AS DID "ALL" THE OTHER MAJOR INDEXS. THIS IS IMPORTANT BECAUSE IT SHOWS STRENGTH. WHEN YOU HIT THIS DOWNTRENDLINE YOU USUALLY SELL OFF SO NOW IT HAS TO REVERSE BACK UP ASAP http://www.buyitbuyitsellitsellit.com/OJ4.gif

SOX INDEX THE SEMIS---SEEMS LIKE AN ORDERLY CHART PATTERN SO FAR...WE NEED A MOVE UP RIGHT HERE AND NOW http://www.buyitbuyitsellitsellit.com/OJ5.gif ANY BREAK OVER HARD R AT 510 AND WE'RE OFF TO THE RACES.

SPX 500 INDEX---MY PROXY FOR THE MARKETS---AT SOLID SUPPORT HERE NEEDS TO MOVE UP AND OFF THIS AREA NOW. A BREAK BELOW 1430 AND LOOKOUT BELOW. http://www.buyitbuyitsellitsellit.com/OJ6.gif

TLT---TNX---I CALLED THIS TRADE MONTHS AGO OFF THE BOTTOM OF THE 10 WEEK TRADING BAND FOLKS I SAID BUY THE US U7 AT 107.25 CHECK IT OUT NOW!!! AS THE FED CUTS RATES WILL BE VERY NICE FOR THE HOUSING DEBACLE ON DOWN THE ROAD.

GC CONTINUOUS---I WROTE THAT 700 WAS HARD R BUT THE GOLD BUGS BLEW THRU IT NICELY HERE'S THE CHART http://www.buyitbuyitsellitsellit.com/OJ7.gif

VIX INDEX---EVERYONE IS TALKING ABOUT THE VIX. THAT LOOKS LIKE A NICE RIGHT SHOULDER OF A H&S PATTERN IF IT WORKS WE'RE IN GREAT SHAPE http://www.buyitbuyitsellitsellit.com/OJ8.gif DOWNSIDE TARGET IS 16.00

ES U7 CHANGING TO DECEMBER THIS THURSDAY FOLKS THIS CHART LOOKS IDENTICAL TO ALL OF THE CHARTS RIGHT? SYMMETRICAL TO ME. IF WE BOUNCE THEY ALL BOUNCE UP TOGETHER. http://www.buyitbuyitsellitsellit.com/OJ9.gif

ALL AND ALL FRIDAY WAS A SCARY DAY FOR MOST TRADERS AND INVESTORS. WE ARE UP AND DOWN LIKE YO YO'S ON A STRING. THIS IS THE WAY THE MARKETS MAKES A BOTTOM. IT TAKES TIME FOLKS WE ALL HAVE THAT EVERYONE!
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THE PASSWORD FOR THIS WEEK IS benhelpus one word lower case letters
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NEM---44.50 THE BTL---43.90 THE SST---IF GOLD KEEPS ROLLING HIGHER THEN LET'S TRADE SOME GOLD STOCKS<G>

ABX---36.95 THE BTL---36.30 THE SST---SAME HERE AS THE BREAKOUT OF THIS LARGE BASE MAKES IT A SOLID TRADE

EXM---48.15 THE BTL---47.50 THE SST---WEIRD SECTOR BUT WOW CAN THIS TRADE STRONG WATCH 49.00 FOR A BIG B/O

JASO---39.15 THE BTL---38.55 THE SST---FABULOUS RELATIVE STRENGTH ALL LAST WEEK WATCH THE SKY HERE TRADERS

RMBS---15.75 THE BTL---15.15 THE SST---NEWS POST CLOSE ON RMBS WATCH THIS FOR EARLY STRENGTH THEN BUY IT

TSO---49.85 THE BTL---49.20 THE SST---AT THE 20 EMA, WAS A FANTASTIC OPTION TRADE FOR BETTER THEN 75% PROFIT

AMZN---84.85 THE BTL---84.20 THE SST---JUST AS STRONG AS ANY STOCK RIGHT NOW 83.00 3 BOX REVERSAL BUY AREA

ACH---62.05 THE BTL---61.40 THE SST---ANY BREAK BELOW 61.00 SHORT THIS HARD THE CHINA STOCKS ARE CORRECTING

OMTR---24.85 THE BTL---24.20 THE SST---WE NAILED THIS STOCK FRIDAY AGAINST ALL ODDS VERY NICE RS HERE FOLKS

NTRI---57.20 THE BTL---56.60 THE SST---I'M THINKING ABOUT TRYING THIS DIET SO TAKE IT LONG ON A SLAM EARLY<VBG>
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WE NEED TO SEE HOW THE STREET HANDLES THE FRIDAY CRASH. I DO NOT WANT TO SEE BP'S REVERSE DOWN HERE SO I'LL BE WATCHING WITH BOTH BAD EYES.

PLEASE USE HARD STOPS AND PLEASE STOP TRADING LIKE IT'S YOUR LAST TRADE OF YOUR LIFE. OVERTRADING WITH OUT TECHNICAL'S IS EATING YOU UP ALIVE.

SEE YOU IN THE ROOM, I'LL BE OUT BY 11.30 TO 1.30 EACH DAY THIS WEEK. YOU NEED TO TAKE A BREAK AT LUNCH TOO. TRADING THE DOLDRUMS IS A LOSER

SEE YOU IN THE ROOM

JERRY & INNA








Jerry Olson
The Jog Group LLC
[e-mail]