You’re going to learn how to deal with these markets and there phases over the next 3 months and how 2009 will work. Options expiration will be wild and full of short covering, and redemptions will be hitting the markets all at once. SMF Traders need to watch the improvements on the technical bounces as we are in phase two of the wash out and buyers are coming back in again. There is going to be a pop again and we are ready to buy up stocks at lows as the news is getting factored in right now. As the markets are dealing with the unknown factors it will soon find its footing.
Options markets are going to get wild! As you traders seen yesterday and the hedge funds came in and sold as rumors are hitting the street that more is coming and that is causing a great deal of problems as we move through the next 48 hours. We have instructed our traders to keep very tight stops. Once we get out of the expiration we can set up the lows as we should to take markets higher off the tier level 1 and the banks are not the issue any longer it is the economy and earnings. We should get a window of short covering again and markets will get a break once the sellers are out and the redemptions are clearing out the way we should go higher for now as all the stimulates will work in the short term, Mario Marciano has said there is a nice bounce coming even at these levels and we are looking for the next round of lows to hold and bounce higher as they will.
The unemployment is an issue that we will have to deal with next year. Markets can put all these things on hold and even discount the news for a period of time, and then move higher. We will be dealing with new issues after the first of the year. We should see a lot of short covering come off the markets during the end of October.
Mario has said, the markets can and will be forgiving...for a period of time to adjust the balances of shorts and longs. We are strongly looking to take the trade higher when this happens as we move through the earnings and news gets out then we will have a period of relief during phase 1 of capital markets going forward as there are stages we will move through once the markets find how the earnings come out then the markets can discount other bad news and see improvements in the banking sectors as lenders can start lending again.
Our next big hurdle is to deal with unemployment next year and earnings again in 2009. SMF Traders will learn how to do deal with all the aspects of various levels of markets going forward.