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Are You Ready For a Crash?
I warned that the rally of the last week was nothing more than a snapback move from oversold conditions.
Indeed, these kind of sharp moves are normal for market collapses. As I’ve noted, during the two months of October-December 2008 we had three sharp rallies of 11%, 17%, and 20% respectively. Every time the market rolled over hard soon afterwards.
We’re seeing the exact same sort of moves today. Indeed, this last snapback rally was about 10%. And the market has rolled since rolled over hard. Whiping out nearly all of the gains post the Fed FOMC meeting in just two days.1,175 didn’t offer any support for the S&P 500. By the looks of it 1125 won’t either, which leaves the next place for a likely bounce at 1,075 or so.
As I’ve pointed out many times, Crashes follow a well known pattern. That pattern is:
1) The initial drop
2) The snapback
3) The REAL Fireworks
This latest collapse is following this perfectly. The bounce is now ending and we’re going into the REAL fireworks.
On that note, if you’ve yet to prepare your portfolio for Round Two of the Financial Crisis, you can find actionable investment ideas that will not only protect your portfolio, but help you produce outsized profits in my FREE report, The Financial Crisis “Round Two” Survival Kit: How to Survive a Crisis Four Times Larger Than 2008.
This report is over 9 pages long and includes detailed analysis of why the First Round of the Financial Crisis happened, why the next round (Round Two) will be even worse than 2008, and which investments can produce triple digit winners when the market crumbles.
This report is 100% FREE. To pick up your copy today simply go to: http://www.gainspainscapital.com and click on the OUR FREE REPORTS tab.
Good Investing!
Graham Summers
PS. We also feature four other reports ALL devoted to helping you protect yourself, your portfolio, and your loved ones from the Second Round of the Great Crisis. Whether it’s my proprietary Crash Indicator which has caught every crash in the last 25 years or the best most profitable strategy for individual investors looking to profit from the upcoming US Debt Default, my reports covers it.
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Gross says Treasuries indicate recession
http://www.reuters.com/article/2011/08/19/us-pimco-economy-gross-idUSTRE77I56W20110819
Sorry Graham, no room for you in the bunker.
he is a funny guy:
"Attention: Concerned Investors
Are You Ready For The
Second Round Of The
Great Crisis?
Download Graham Summers'
5 Report Personal Protection Kit
Right Now - For Free!"
Why do we have to see your "buy my stupid report" posts three times a day during an August market sell-off? As someone who would like to see financial markets get spanked down to fundamental value I view your crap as bad luck, and I don't even believe in luck. GO JUMP IN A POOL!
Reese,
The reports are vital to your survival. The fact that they are about 7 years old doesn't mean you don't need them. LOL.
Buy the GDX. Short the dollar. Short bonds. THOSE are his reports-I like when a post of his appears, he's fun to ridicule.
Thanks for that. I rarely click on their infomercials anymore and should just plain stop. "cue ball in Harlem" -"Live and Let Die"
COME OVER TO THE "BEAR MARKET THOUGHTS POSTS"
I'M GETTING MY ASS KICKED.
This author consistently has the least informative posts on this site-but every once in while I can't help checking it out to see if any improvement is occurring-its not. He is the anti-Bruce Krasting.
Anyone naive as to think one can profit in any real sense while the fabric of society and trust is being destroyed by fascist central planners is out of their mind. Neither guns or gold will save you and I have lots of both and have for many years. But I don't fool myself to think it would make much difference in a choatic society.
Unlike this author, I say this as someone who bought puts on GM, C, BAC, AIG, MS, X etc. over two months ago and just rolled my profits yesterday and today down and out-so I'm "bettting" on a continuation of this down trend. As the song goes I'm "in the money" (ITM), but surprisingly don't feel a bit wealthier in any real sense. Shows you can never enjoy gains the way you regret losses. Its exactly how I felt a couple of years ago cashing in my C, BAC, AIG, MER, MS puts two years ago. I really hate the FIRE sector of the so-called economy! Let it burn!
Ron Paul 2012.
I know I'll catch flak, but really, IMHO Ron Paul would be as big a disappointment as Barry IS.
This is America, our best leaders don't believe in ANYTHING.
PERRY 2012!
take with a grain of salt please.....
Yeeessssss iiiiiii ammmmmmm. Rrrrrr youuuuu?
You bet, I've been waiting for two years. My TZA has gone ballistic finally, I've added another thousand to the kitty, and my nightly prayer (besides the one that Sofia Vergara will finally ask the judge to remove the restraining order on me) SKF is almost profitable, and my VZZ is just so. Another two-4 four thousand points down would suit me just fine.
But sooner rather than later god will intervene and prevent me from being really happy. She's has had it in for me since I wished frevently for a heart attack on Sister Rita Ann.
Anony, "..my nightly prayer (besides the one that Sofia Vergara will finally ask the judge to remove the restraining order on me).."
You too ah?!!
I hope you realize leveraged inverse ETFs like TZA are a terrible way to bet against the market? The slippage is almost guaranteed to lose you money-unless you get your timing perfect. If you must use these leveraged products short TNA (buy puts or sell calls), so at least you benefit by the effect of daily compounding or slippage as well as your opinion on market direction. An example, I shorted FAS by both buying puts and selling calls last month. Did the same with QLD.
I found out too late about the 'slippage' 20 months ago, or I would have bailed much sooner. You're absolutely correct. But those I have, have finally turned significantly positive, so much so that if I hadn't been long some staples like BMY as my upside hedge, I'd be in clover.
I will however do as you suggest on shorting TNA though it's already in the 30s. Ditto qld and fas.
Thx for the reminder.
John
I agree about the "slippage" (black hole maths) of ETF products... the 2x leverage is for REAL to the downside, the 2x leverage on the upside the ETF does not do what it says on the can (ie. is a mis-selling/fraud)
My current ETF Securities (a Jersey Channel Islands offshore 'front' for major US Banks) Silver 2x Long was under-performing on the upside at 1.5x instead of 2x, this week it barely kept pace with Silver at 1x ..in fact I'm pretty sure this 2x is barely a 0.80x product it's so fuking pathetic
I've had the same 'doesn't do what it says on the can' experience with ProShares (a 'front' for JP Morgan). The 2x leverage ETF's are REAL ACCURATE 2x leverage losses but REALLY INACCURATE 2x gains
I asked my stockbroker why my ETFS Silver Long is not performing to its 2x leverage. He replied it's because they reflect "the days trading". I replied what part of the day does it reflect the actual %percentage gain in the Silver price? He hasn't replied
Anywhere to learn these Puts & Calls methology in simple easy-to-get-your-head-round English as am fed up of these Big Bank ETF schemes/scams?
I don't know what this world is coming to. You live your life helping others, you stay true to your principles, you become a
pillar of your community, you are kind to animals, respectful of others regardless of their station in life. You are a model citizen,
but you rape one nun and they want to crucify you. It just doesn't seem fair.
The preceding is a dramatization intended for mature audiences.
Were you drunk? Then Cheney and Clinton forgive you
The basic problem with the newsletter writter is the crash he wants to warn you about already happened; aside from that it's very timely information. LOL!
What good is a 145 IQ if you can't spell words correctly?
Second only to Leo, Graham Summers is my most detested contributor on ZH. Bear talk bear talk blah blah blah. I may be bearish in viewpoint, but this guy is just shrill and uninformative, the anti Cramer huckster shilling his newsletter. F off!
The world will be very lucky if 6,624 is the bottom. Hard times ahead; are you ready?
http://www.collapsenet.com/262.html
Rupert is a certifiable crack-pot BUT he's been on point quite a lot.
Always entertainting. It's all scary shit.
i'm ready for a beer
Here Caerus
This ones on me,Carlsberg elephant
Cheers
Yes I am ready and willing to watch the carnage.I hope it blows up
love to watch paper burn especially when its counterfeit
How much in kickbacks does ZH get from this group? There is nothing analytical in the above. I suppose you have to be a "subscriber" to recieve that?
Fair question IMO.
I've said this exactly 3 previous times on Zero Hedge (this will be the 4th). The "ultimate low" is going to be 6624 on the DOW. The markets are shitting out the various rounds of quantitative easing and will resume their downward trends once they have reached parity with the 2009 lows. Looking at this on the day-to-day or even week-to-week scale is not adequate. We have to look at the problem on a multi-year basis. Liquidity issues within major financial institutions play out on a year-long time scale. Patience is the name of the game. And 10,800 is not a market bottom.
The "ultimate low" is going to be 6624 on the DOW.
Wow! That is amazing! 6624. Not 6623 or 6625? I have never met anyone who was able to accurately predict a bottom with such precision. Did some supernatural entity visit you and give you this information? Perhaps while you were smoking something? And did the entity also happen to mention the exact date (down to the second) when this bottom will occur?
10,800 is not a market bottom; that's correct. the bottom was last week at 10,600. 10,800 is part of the process of rallying; until it isn't. Nobody trades the "long Term"; In the long term we're all dead.
...does this mean I need to shitcan my Dow 10,000 hat ?
Yes. Once a douche-bag great enough to call himself "IQ 145" calls a bottom it is off to the races...
You sent the same spam crap out then too.
Graham is Zero Hedge's resident lightweight. He repeatedly says less than your average armchair blogger, and always follows it with a cheesy salespitch. Just ignore him.
When TD puts this shat on the website, I find it no different that CNBC. You want to destroy your brand? Keep adverstising Kickapoo juice artists
So quit clicking on and commenting about his articles??? Vote with your trigger finger. If no-one read the articles they wouldn't get published.
The 'Brand' would be destroyed if they started publishing only the trite shit that nobody disagreed with.....
Well, it looks like we've got to buckle up!
Another point of view; from a chart reader. Todays bottom is higher than the bottom last week; no new low. A market that makes new higher lows is a bull market. Temporarily. Yes, everything is temorary. Still holding my BAC stock bought at $7.37; why? No new low. A market that makes higher lows as it goes forward is a bull market. Until it;s not. And that hasn't happened yet. Closed on strong buying. One of two things always happens; a.) you get a stop loss, b.) you get a profit. The history of markets indicates that this is a reflex rally, people are finding bargains, and the odds are that it will continue to work it's way higher; for awhile. Not making new lows is part of the process of working it's way higher. This is called rational analysis; I have no opinion on this matter at all. I will take profit at $11 if that comes about.
IQ 145. I see you are good at pattern recognition. Good. Now, figure out where BAC would price today if it was "following the market." The problem is, bright guy, BAC is leading the market. Are you sure you wish to follow? Oh, I see - you have stop loss orders in. Good. You'll be glad you did.
Dude. Stay out of BAC.
"A market that makes higher lows as it goes forward is a bull market. Until it;s not. And that hasn't happened yet. Closed on strong buying."
WTF are you talking about? It sold off into the close. It finished a meer 10 points above the day's low. The higher lows bit? How long have you been trading? That only works when it tests the low, which it could do Monday. Yes, if it bounces off support, your thesis may be valid, but it hasn't been tested, and certainly not on a sell off into the close end of the week. I think it's breaking down, but we won't know that until next week.