Okay, I have a trade. I think it's a sure thing, but don't quote me on it. BLUD
The seasonality of all these is that the healthcare/biotech stocks rule the summer.
BLUD is at $15 having fallen on some kind of investigation BS. I'm targeting the Sep $20 calls at .50 or less. This could be a bigggy.
As for the market on Friday, understand what's going on and why you have to be carefull about betting on the fall. Yes, the market 'should' go down. However, there are things at work that might not let that happen. Let me explain...
First off, retirement accounts. The government needs everyone's 401ks back so they can fund private retirements rather than the government having to bail them out, too. But really consider the pension funds out there underwater and underfunded. That's a huge monster problem. All state and federal retirement plans are invested in pensions. Most got their asses kicked in this decline and are underfunded. That needs to change. Another reason for 'them' to run the market.
The Fed has systematically tried to kill any investment competitor to the stock market as a viable alternative to the market. Why? For all the reasons above.
The reason gold isn't at $2k or better as it otherwise would be under the current circumstances is because I believe there is a concerted effort to make sure it doesn't happen. Again, 'they' need to make all investments other than stocks un-viable. They desperately need the market back up to again fund the retirement accounts.
There is no way in hell Obama is getting healthcare and any one of the other high tax/spend programs without the market back up.
Now the key here is that the SPX is right at the 200 day MA. I think it's at 943 right now. If the SPX can close convincingly above that, HUGE amounts of money will pile into the market. I think there is a very concerted and I will add 'dubious' attemtp to make that happen. That alone could run the market very well.
So, be carefull betting against it. If there was another big leg down coming as I always thought, you'd see the market much weaker than it is. I doubt there's some large amount of huge selling blocks of stock like there was in the Fall last year because we'd see signs of it. We don't.
Now the problem with all this is the fact that the bond market is warning us to forget about printing any more money. That run to almost 4% the last week was a prelude of what's to come if the Fed and Obama keep it up with the spending and printing.
If the bond market decides to dump bonds because of all that and Obama blows them off, the market is headed to new lows for sure.
But until that happens, don't fight it. The NASI and NYSI are both on weekly sell signals. That's a concern for long traders. But that could change.
