Thursday, November 09, 2006

Lame-Duck Market; Stock Indexes Reverse And Give A Clear Distribution Day.

Stocks opened higher and were holding those gains until right around 1PM EST. Then a small portion of hell broke loose. Stocks started falling, picking up volume to the downside, until the closing bell. I guess the market didn't like the fact that democrats took control of the House and Senate. At least that is what I am going to use. Why not? That reason is as good as any other reason, and since I hate their economic policies more than a root canal without novacaine, it seems good enough to me.

After showing early gains, stocks reversed, with the SP 600 leading the downside with a .9% loss, the DJIA fell .6%, the SP 500 fell .5%, and the Nasdaq fell .4%.

Volume was much higher on the Nasdaq--almost 25% higher--and higher on the NYSE. Breadth was negative on the NYSE by a 10-to-7 margin and negative on the Nasdaq by a 2-to-1 margin.

This now gives the Nasdaq four distribution days and the SP 500 three distribution days in the last four weeks. (I hope that clears it up for you, Lafayette).

A pullback was to be expected soon, after 3-4 up days on the indexes. However, the count of distribution days should peak some interest. Much more now than before, especially since we are getting near the end of earnings season.

One distribution day fell off yesterday but today's distribution day brings the count right back to where it was before the bell. The new count has a more negative look to the distro days this time around than it did just yesterday.

The good news today came from Gold. The Philly Gold/Silver Index rallied 4.3%, besting all other indexes today.

The bad news came from Biotech and Healthcare. Those major indexes fell 2% and 1.9% respectively. But Telecom and Financial stocks also sucked it up hard.

There was also some other good news. Of course, the media decided to skip the news that should have been a welcome to all democrats. The trade deficit....ah why get into it. Then we would just be stating facts and that would make the economy look strong and we wouldn't want that. So I will just do what the media does when good news comes out about the economy. Skip it!

The market still has not rolled over. Expecting it to do so and for things to get worse from here is a purely amateur play; just like predicting the market falling or rising. Who gives a rat ass about your opinion or my opinion? Nobody. Especially the market. The market really doesn't care what you or I think. PERIOD!

Stay disciplined and follow the big trend of this market. That trend is up, in case you are blind. Pullbacks still have the odds in the favor of being accumulated and not sold into. When the market pulls back and then does not rally to new highs, then you have every reason to start to get bearish. Then when that failure of hitting new highs translates into prices hitting lower lows than the previous dip, then you have every right to start searching for shorts. Until then you are strictly gambling. I don't gamble; I am a professional speculator.

If you don't think the best time to start shorting is until AFTER the market rollsover, do me a favor and go buy "How to Make Money Shorting Stocks" by William O'Neil. Until you read that book, I refuse to argue anyone that disagrees with my previous points.

BTW, Congrats to the party of cut and runners, retreat and defeat, tax and tax, investigate and litigate, and negotiate and do-nothing. I am sure you guys will find a way to sign a "peace" deal with Hamas, Iran, and Syria. I am also just as sure it will turn out as well as North Korea and Jimmy Carter's blunder in not supporting the Shah. I also look forward to the withdrawal from Iraq. Just like in Vietnam, their leaders knew you were weak and easy to defeat. The party of losers, you now have two years to scare the FUCK out of us.

Here is part of an article for you to digest. If you are not a fan of the truth and want to live in a fantasy world you don't have to read this blog. I will never appease that way of thinking.

While Democrats in Congress always assert they "support our troops," their political policies and actions have continually undermined our nation's fight to win the war on terror and defend America. Here is their national security record:

1. On missile defense of America — Democrats voted against it.

2. On the Patriot Act — Democrats voted against it.

3. On tapping foreign terrorists' phone calls to the U.S. — Democrats voted against it.

4. On tracing terrorists' money flow between foreign banks — Democrats voted against it.

5. On building a border wall to control illegal immigration and stop dope — dealers, terrorists and criminals — Democrats voted against it.

6. On interrogating captured terrorists — 194 Democrats just voted against it.

7. On telling the world (and our enemy) about a timetable for withdrawing from and deserting Iraq — this is Democrats' retreat and defeat plan.

Think that's bad? Here's the Democrats' national defense record for the last 40 years:

A. Democrat President Johnson misjudges the Gulf of Tonkin incident, pursues the Vietnam War until a liberal CBS TV announcer thinks we're losing and says we should quit. So we quit and lose. The victorious communists then kill 2 million innocent civilians.

B. Democrat President Jimmy Carter during the Cold War withdraws U.S. support for our longtime military ally, the Shah of Iran. Carter doesn't like his human rights treatment of Soviet spies in prison. The shah is overthrown, and Ayatollah Khomeini returns, seizes power and creates an Islamic nation. Opponents are killed, the idea of suicide bombers is introduced to the PLO, and Iran's oil wealth is used to spawn and support Hezbollah, a terrorist militia that killed 241 Marines in a Beirut bombing and that lately attacked Israel. Iranian radicals storm our embassy, taking 52 American hostages for 444 days. Carter fails in an amateurish attempt to rescue them. Eight military personnel and eight aircraft are lost in a desert foul-up.

Democrat Carter, self-assured and well-meaning but dangerously naive, was responsible for bringing into power an Iranian Islamic regime that's now creating nuclear weapons to wipe out Israel and blackmail the U.S. and Europe. Iran has further provided weapons and support to Shiite militia and death squads in Iraq and could provide nukes to al-Qaida, with which it has a working relationship.

After the Soviets meet the inexperienced Carter, they invade Afghanistan. Then the communists capture Ethiopia, South Yemen, Angola, Cambodia, Mozambique, Grenada and Nicaragua. The Afghanistan invasion attracts young Osama bin Laden, who raises money and recruits other Muslims to fight the anti-Soviet jihad. After the Soviets leave, this band becomes al-Qaida.

So Carter's glaring weakness in dealing with the communists and Iran leads directly to both the current terrorist nuclear threat of Iran and the birth of al-Qaida, a group of mass murderers that would never have been possible if the Soviet Union's Leonid Brezhnev had not been emboldened to invade Afghanistan after seeing an inept, appeasing American president, Carter.

Carter's ongoing, worldwide damage to America's future national defense does not end there. In 1994, civilian Carter goes to North Korea and negotiates an agreement that President Clinton and Secretary of State Madeleine Albright buy into. The North Koreans use our money and help to secretly spend the next six years in researching and building nukes. Deceived again by a worthless piece of paper, Carter becomes America's Neville Chamberlain.

These Democrat policies and actions were not only incompetent and ineffective in defending the U.S. They also proved to be highly dangerous, creating the greatest threats to America's future security — a radical Islamic Iran and a North Korea with nukes, either one of which could hand weapons off to al-Qaida killers. And Carter is still out there giving us advice.

Ronald Reagan inherited from Democrat mismanagement a rapidly expanding communist enemy, 12% inflation (highest in 34 years), 21% interest rates (highest since Abe Lincoln was president), a depleted military and a serious energy crisis. Reagan's motto was "peace through strength," not peace through retreat, weakness and accommodation.

He kicked communists out of Grenada and defeated them in Nicaragua, Ethiopia and Afghanistan. He supported those fighting against communist regimes. He attacked Libya's Moammar Gadhafi, who much later surrendered his nuclear weapons program after America's military captured the tyrant Saddam Hussein hiding in a hole in the ground.

For eight years congressional Democrats ridiculed and fought all of Reagan's defense and economic policies. They said he was dumb, stupid, too old and a warmonger who was going to start WWIII with the Soviet Union. Democrats were proved wrong on nearly every vital Reagan policy. His tax cuts set off a huge seven-year economic and technological boom, just as George Bush's broad tax cuts have done, creating millions of new jobs.

In the end, the Reagan-Bush administration defeated the 70-year-old Soviet Union, and communism disintegrated on the ash heap of history under Republican Reagan's relentless pressure and determination to build a missile defense system to make the Soviet nuclear arsenal obsolete.

The present terrorist threat to our security did not begin on 9/11, but in the early 1990s, after Democrat Clinton was elected in November 1992. In February 1993, terrorists bombed New York's World Trade Center. In October 1993 two U.S. Black Hawk helicopters were shot down in Somalia. Eighteen Americans were killed and 73 wounded. In response, Clinton withdrew our forces.

In January 1995, Philippines police uncovered a plot to blow up 12 American airliners over the ocean. In June 1996, Khobar Towers, which housed U.S. Air Force personnel in Saudi Arabia, was blown up, killing 19 U.S. servicemen and one Saudi and wounding 372 others.

In February 1998, bin Laden declared "war on America," saying the murder of any American anywhere on the earth was the "individual duty" of every Muslim. In August 1998, al-Qaida blew up U.S. embassies in Nairobi, Kenya, and Dar es Salaam, Tanzania, killing 200 and injuring 5,000. In October 2000, 17 U.S. sailors were killed when al-Qaida attacked the USS Cole in the Yemeni port of Aden.

According to Michael Scheuer, a 22-year CIA veteran and head of the agency's bin Laden unit, the 9/11 Commission report confirms that the Clinton administration had at least 10 chances to get the al-Qaida leader, but Sandy Berger, Richard Clarke or Clinton simply could not make the decision to act. The CIA knew where bin Laden was and the military had plans, but they were almost always called off at the last minute.

So when presented with 10 specific opportunities, Clinton's Democrat administration never took any action that was effective or produced any positive result. From Lyndon Johnson in the 1960s to the policies and actions they push today, Democrats haven't been just weak and ineffective in defending against America's enemies.

This year, two other forces are feverishly working to undermine this election and our war on terror. One force is made up of elite national media based mainly on the East Coast. On several occasions they have given our enemy vital defense secrets. They also disgracefully report and relentlessly repeat only bad news. Such dishonest journalism confuses and deliberately misleads the American public. The TV networks have lost 50% of their audience and still refuse to change their one-sided news coverage.

The other force is represented by terrorists who are desperately attacking as many people as possible in Iraq in the weeks leading up to our election. They believe they can intimidate us like they intimidated Spanish voters in the wake of the Madrid bombings and affect our congressional election in a way that will result in our quick withdrawal from Iraq. But quitters never win.

As difficult and complex as the war has been, America has a very strong economy — with over 95% of our population employed and 70% owning homes — plus freedom, opportunity and a standard of living that other countries can only envy.

We've also been protected against further terrorist attacks by a strong, competent and determined president.

Aloha and I will see you at Investors Paradise.

Ok..whew...I thought tonight was going to be a crazy night of too many longs. 7 of the 8 new longs were in my first 30 charts out of 330. Only CCO was late.


add to current long: TRT. Expect a nice big pullback. But if there is not a pullback expect 100% gains. That is what I am looking for.

Watching: AEZ ADL GOAM


questcap said...


Way to go, man! May I quote you extensively?


BugHunter said...

That was beautiful.

Joshua_NControl said...

Questcap, you are free to copy and paste anything you like from this blog.

Thank you, Bughunter.

Dan Beisiegel said...

I just wanted to complement you on the great job you are doing with this blog. Best of luck in the future.


Joshua_NControl said...

Mahalo, Dan.

I appreciate the well wishes. I promise to not disappoint.


Andy said...

I'm not sure why you are holding back so much, tell us what you REALLY think about those Democrats! :-) I'm glad you can still post, I was dreading being in the dark while your computer was down.