Ron Insana who went bearish on the markets a month or so ago was talking yesterday how he’s ready to start buying and did reference C as he may be a buyer in a few days. I think that 200 MA will bring in a lot of buyers. I’m waiting to buy 2011 $5 strikes there.
Closed at $3.99. Are you sticking to your contrarian theory Eric?
I am but I want a good overshoot on the down side. 1020 on the S&P has been floated around as a market buy in point but I’m looking at minute charts waiting for the tell-tail signs of stop losses to kick in. That said, I feel like $3.85 is good but technicals aren’t jiving with my gut.
...That said, I feel like $3.85 is good but technicals aren’t jiving with my gut.
Intraday, your $3.85 target looks as good as your $4.06 last week, as far as picking short term support. Did you derive those targets from TA?
Today’s S1 is 3.83. Without a major collapse of the markets, there’s no expectation of C dropping much below that, at least not for long. 3.97 (where it sits now) is the pivot point.
... but I’m looking at minute charts waiting for the tell-tail signs of stop losses to kick in.
What would stops kicking in look like? Increased volume? By how much?
I should stop out-thinking myself and stick with what I’m good at: trading. Missed a 3.5% return in one trade by thinking too much.
At any-rate, what a person needs to do is figure out what you want to do and them multiply that by one million and you’ve a market segment. If you don’t know what to do, then it is likely that the market doesn’t know what to do either. If so, then search for a tool that seems to be predicting the market. If none can be found, default to sentiment and if sentiment is the market feels oversold, then the market is very likely to be oversold (there is an art to this). All of this is what my gut told me and I rather unfashionably did nothing. The big idea that I failed to remember is that it isn’t about what technique or system used to invest or trade, its about the traders ability to execute!
Stops? As it looks to me, without news trumping the market and while we have the Fed meeting taking place, I think C rattles around under $4.00. If I had purchased at $3.85 as I had considered but then failed to execute, I would have set a 1% stop, rounded down to $3.81, a four cent spread on 10 or 20 thousand shares for a trade.
I expect tomorrows FED-speak to not include language of raising interest rates but to include a statement that the Fed will raise rates when it believes the market can withstand a rate hike. In other words, I expect the Fed will not try to defend a falling dollar because it knows what happened in ‘37 and to Japan in the nineties when it raised its prime rate.
A week out I’m keen to know what the earnings of the FRE will be. .gov has been using the GSEs to backstop state bonds and I wonder if this will effect the bottom line. What I expect is the the GSEs will continue to reflect a high rate of defaults.
The financials are running up before Fed-speak. Chartguy and I bought financial calls.
Also don’t forget the home buyer tax credit is poised to be voted on Friday to now run through April 2010. That will help the banks for sure as well… Been moving into BAC common out of BAC preferred. Looks like C may have put in it’s bottom.
What makes today different than the other recent days it bounced off of support? That rally at the end of the day? The fact that it closed higher than it opened?
the biggest bank in the country has been quietly selling some of the option-ARM loans it bought when it acquired Countrywide Financial last year. American Banker reports some of the loans Bank of America has been dumping sell for as little as 40 cents on the dollar. The banking trade magazine says delinquency rates are 30%-40%.
At the moment, the resetting of subprime mortgages has abated, and the resetting of option-ARM loans hasn’t yet kicked into high gear. At the Value Investing Congress a couple weeks ago in New York, co-host/investor Whitney Tilson put up the slide below, which tells you why mortgage resets aren’t filling the headlines quite like they used to and why you can expect them to take the stage front and center over the next couple years…
The purple mountain on the left is the subprime crisis, which is behind us in 2007 and 2008. The mostly blue mountain on the right is the option-ARM crisis, a two- to three-year slog that lies just around the next bend and could continue through 2012.
Right now, we’re sitting in the eye of this mortgage hurricane. When we hit the opposite wall early next year, the storm will become deadly all over again.
the biggest bank in the country has been quietly selling some of the option-ARM loans it bought when it acquired Countrywide Financial last year. American Banker reports some of the loans Bank of America has been dumping sell for as little as 40 cents on the dollar. The banking trade magazine says delinquency rates are 30%-40%.
At the moment, the resetting of subprime mortgages has abated, and the resetting of option-ARM loans hasn’t yet kicked into high gear. At the Value Investing Congress a couple weeks ago in New York, co-host/investor Whitney Tilson put up the slide below, which tells you why mortgage resets aren’t filling the headlines quite like they used to and why you can expect them to take the stage front and center over the next couple years…
The purple mountain on the left is the subprime crisis, which is behind us in 2007 and 2008. The mostly blue mountain on the right is the option-ARM crisis, a two- to three-year slog that lies just around the next bend and could continue through 2012.
Right now, we’re sitting in the eye of this mortgage hurricane. When we hit the opposite wall early next year, the storm will become deadly all over again.
Tan, people purchasing bank equities right now are looking down range past the further 5,000,000 foreclosures that are expected to take place over the next 18 months and considering what the banking landscape will look like then. That’s the trick of buying low: when you can buy low, nobody else wants to buy.
In other news, Bove has stumbled and fallen down a flight of stairs and hit his head or something but it has had the net effect of knocking some sense into him. Bove now sides with the Swiss Family Landstrom and believes as he always should have than the banks will double. Bove remains a useful idiot after all and I will stop wearing my “I Loath Bove” lapel pin in public.
We noticed you may be running AdBlock on your computer. It takes real money to run this site and to deliver the news, tips, and opinions you love to read.
If you wish to block the ads that pay for the creation of our content, we ask that you instead support TMO Directly, either with a $5 monthly recurring contribution, or a one-time donation of any amount of your choice. Thanks!
Loading...
$---.--
11” MacBook Air 1.6GHz dual-core Intel Core i5: $999.00 Delivered
NewEgg: $8 off on ZyXEL ES105S 5-Port 10/100 Desktop Fast Ethernet Switch for $11.99 plus Free Shipp
© The Mac Observer, Inc. -- All rights reserved. All information presented on this site is copyrighted by The Mac Observer, Inc. except where otherwise noted. No portion of this site may be copied without express written consent. Other sites are invited to link to any aspect of this site provided that all content is presented in its original form and is not placed within another frame. The Mac Observer is an independent publication and has not been authorized, sponsored, or otherwise approved by Apple, Inc.
