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So Much For Being Long....

Tyler Durden's picture





 

Via Peter Tchir of TF Market Advisors

Reverting back to short.  The sell-off this morning felt overdone, in HYG in particular.  We bounced on Bernanke, but it wasn't with much conviction.  Although BAC and MS bounced nicely off their lows, BAC hasn't been able to get green on the day, although MS has, but barely.  With such weak performance from ideal short squeeze candidates, it seems clear that we are not out of the woods yet.  I think the failure to trade up significantly means we go through the morning lows.

There is no longer any conviction that Greece can be saved.  And guess what, it probably can't, it's just a weird feeling being part of the consensus.

I think we see France put on at least outlook negative soon, possibly this week.  S&P came out on the UK yesterday.  They left them alone, but that is probably a sign of a review of all their European sovereign ratings.  Several paragraphs in their UK opinion were focused on government action.  Similar to their focus on the US government, they just happened to like what the UK is doing.

I think several countries will be at risk in Europe, but Germany has remained opposed to increasing EFSF or using leverage.  France has seemed more aggressive.  If the rating agencies wanted an excuse to take the French off AAA, they may have it.  It would also appease a lot of Americans if some other country was feeling pressure on its ratings due to politics.

Today S&P came out with a report where they increase their odds of a European recession.  The timing is interesting as it would give them another excuse to put at least some of the countries in Europe on outlook negative if not on negative watch.  Just a thought, but that is a tape bomb that could easily hit.

I'm more comfortable with better quality high yield bonds, as the yield is finally getting big enough to earn the moniker "high".  Retail seems comfortable holding as they remember how quickly they bounced back in 2009, and so far, there have been more rumors of defaults than actual defaults.

 


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Tue, 10/04/2011 - 13:42 | Link to Comment Smithovsky
Smithovsky's picture

Defaults shmefaults, where's the iPhone?  

Tue, 10/04/2011 - 13:47 | Link to Comment HelluvaEngineer
HelluvaEngineer's picture

Right.  I hear it has speech to text.  ROTFLMAO.

Tue, 10/04/2011 - 13:55 | Link to Comment pods
pods's picture

Haha.  Pretty soon they will have a phone that allows two people to talk to each other?

pods

Tue, 10/04/2011 - 13:55 | Link to Comment spiral_eyes
spiral_eyes's picture

I hear the key feature of the new iPhone is that Bernanke can print them.

Tue, 10/04/2011 - 14:01 | Link to Comment jdelano
jdelano's picture

No, no, it lets everyone print as many idollars as they want, which will be all be backed by corresponding U.S. dollars courtesy of The Bernank.  There, fixed it for you.  

Tue, 10/04/2011 - 14:11 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Yep, as I said a while back, even the Fed won't fight the Fed any more.  Got physical?  Yes?  Fucking hide it, because otherwise it will be confiscated.  This is not a you average liquidity trap, this black hole will suck everything in.

Tue, 10/04/2011 - 13:57 | Link to Comment Edward Fiatski
Edward Fiatski's picture

Speaking of "ROTFLMAO", there's a market for that - http://www.youtube.com/watch?v=2bZXCkoRs5g

Tue, 10/04/2011 - 14:03 | Link to Comment Carbine
Carbine's picture

So it goes!

Tue, 10/04/2011 - 13:48 | Link to Comment HelluvaEngineer
HelluvaEngineer's picture

I tried to contact the first three but apparently they are all in Chile now.

Tue, 10/04/2011 - 13:42 | Link to Comment reader2010
reader2010's picture

You've got to study Jesse Livermore first. 

Tue, 10/04/2011 - 13:42 | Link to Comment Corn1945
Corn1945's picture

So is this guy just telling me to "buy and hold"? Pretty much everything "bounced back" in 2009. This is pretty lousy advice.

Tue, 10/04/2011 - 13:52 | Link to Comment slow_roast
slow_roast's picture

Reading comprehension clearly wasn't your strong point in school.  The article just states that RETAIL is not selling because they remember how quick the bounce happened in 2009. 

Tue, 10/04/2011 - 13:53 | Link to Comment Raynja
Raynja's picture

He isn't providing advice, he writes commentary on how the market is behaving. Usually his ideas center around credit and equity market signals.

"Retail seems comfortable holding " is an observation.

Tue, 10/04/2011 - 13:43 | Link to Comment Woodrox
Woodrox's picture

When did "one" go long?

 

Tue, 10/04/2011 - 13:54 | Link to Comment Ruffcut
Ruffcut's picture

John Holmes did well, going long.  Robo, IQ45, dangertime, hamy..I'm not so sure.

Tue, 10/04/2011 - 14:07 | Link to Comment Dangertime
Dangertime's picture

I went long a couple of weeks ago.  I am dollar cost averaging on FCX.....but still feeling pain.  Although I am not worried.  I'm confident I will be very green within a few months.

Tue, 10/04/2011 - 14:14 | Link to Comment Motley Fool
Motley Fool's picture

You expect QE3 that soon then?

Tue, 10/04/2011 - 14:22 | Link to Comment Dangertime
Dangertime's picture

I posit that the market has reached an extreme point of selling and will snap back over the course of 6-9 months.

I anticipate that we do not necessarily need QE3 for that.  Although some "news item" will take the credit for the market reversal.

Tue, 10/04/2011 - 14:39 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Sure, the market will come back.  Just as soon as the computers leave and the customers/people/suckers actually come back.

Tue, 10/04/2011 - 14:44 | Link to Comment Motley Fool
Motley Fool's picture

I would disagree with your proposition.

I do agree that at some point, a extreme of selling will have been reached and a rally will occur from that point.

I just don't think we are there yet.

Tue, 10/04/2011 - 13:45 | Link to Comment TradingJoe
TradingJoe's picture

And we're back to square ONE!!!

Tue, 10/04/2011 - 13:48 | Link to Comment DormRoom
DormRoom's picture

"Hi my name is Peter, and I'm a Short.  It's been 1 day since I've been Short."

Tue, 10/04/2011 - 13:54 | Link to Comment FederalReserveB...
FederalReserveBankofTerror's picture

"Hi Peter"

Tue, 10/04/2011 - 16:12 | Link to Comment Joe Shmoe
Joe Shmoe's picture

How's that relapse feelin Pete?

Tue, 10/04/2011 - 13:47 | Link to Comment clones2
clones2's picture

Looks like the intraday charts are rolling over - afternoon flush...? Hell - I'll even say we set new daily lows before close.

 

Tue, 10/04/2011 - 13:48 | Link to Comment clones2
clones2's picture

Not much confidence in that call... but any short covering today has been light...

Tue, 10/04/2011 - 14:01 | Link to Comment Edward Fiatski
Edward Fiatski's picture

Flush sounds about right.

All these MSM outlets are pumping at this hour the QE, which Bernanke hinted on. Do you know in what context Ben said he would use 'additional measures'? Arma-fucking-geddon in Europe; Lehman 2.0 first, QE thereafter.

Delusion is still running at elevated levels at this hour.

Tue, 10/04/2011 - 13:47 | Link to Comment HANKREARDON
HANKREARDON's picture

Dear Peter, If you have conviction, please come out and say it. Otherwise keep your vague opinion to yourself.

Tue, 10/04/2011 - 13:48 | Link to Comment twotraps
twotraps's picture

have to agree about the lack of upside follow through.  Although the lows were exactly spectactular, in that there was NO extreme rejection of them with wild spiking activity where Everyone suddenly considered stocks overall a deal....we did get a nice push.   I'm watching 110.50 in SPY, and in XLF 11.35, essentially the old low.  Without progress there, door remains open to re-test the low.  

Tue, 10/04/2011 - 14:13 | Link to Comment reload
reload's picture

I agree, I trade the FTSE and this am (europe time) we wend down in formation with the DAX etc - no suprise at all. Then we took a breather for an hour or so of chop before heading lower on shrinking volume as the US markets opened. We were off the lows and making very slow progress to the upside as BB started to talk. He gave the market a small lift and a chance to exit recent longs (for a very thin profit) before we ground to a halt shortly before our close. Considering the recent sell off, it was a very tame bounce indeed.

Certainly his comments have not given the commodities a lift, so I think the sell off resumes from here. The deeply suspicious speculator in me wondered at the time if his comments were just meant to take the steam out of the general sell off. I have a feeling that the air is being let out of the balloon now and that no shock and awe printing is on the horizon.

Tue, 10/04/2011 - 13:49 | Link to Comment Bwahaha WAGFDSMB
Bwahaha WAGFDSMB's picture

So far, there have been more rumors of bailouts than actual improvements in the financial system.

Tue, 10/04/2011 - 14:41 | Link to Comment LawsofPhysics
LawsofPhysics's picture

According to plan.  The police tell you everything is okay at your front door while you are being robbed out the back.  just waking up are we?

Tue, 10/04/2011 - 13:50 | Link to Comment Bansters-in-my-...
Bansters-in-my- feces's picture

What the fuck just happened to gold and silver.!!!..?????

Is that what the Fucking Pig-Dog Manipulators do with Negative gold lease rates.!!!...????

 

Tue, 10/04/2011 - 14:03 | Link to Comment Threeggg
Threeggg's picture

They sell short 1000's of contracts (paper) to volitize the trade so that they can raise margins (see look at how volitile this market is folks). The CME runs this game with paper certs like the Bernank runs the economy with the printing press.

are they in the same business................................................?

Who is in charge of the VIX anyway ?  Well looky there -  it's the CME.

Tue, 10/04/2011 - 14:42 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Yes, but I don't think margins can exceed 100% whereas we still have a lot of trees to make paper for Ben'sprinting press.

Tue, 10/04/2011 - 13:57 | Link to Comment LongBalls
LongBalls's picture

Gold and Silver are tracking the general commodity sell off. BTFD dude. They have only two choices. Print or roll out new currency. The debt loads are un-payable and the banks are in trouble once again.

Tue, 10/04/2011 - 14:13 | Link to Comment r101958
r101958's picture

They are using PM paper proceeds to prop up the market.

....rinse, repeat.

Tue, 10/04/2011 - 13:51 | Link to Comment jm
jm's picture

May be just seeing rotation from HG to HY.  But that means the wad is shot and more downside will be brutal.

Tue, 10/04/2011 - 13:52 | Link to Comment Glasgow Gary
Glasgow Gary's picture

There is upside risk in the SPX to 1275. Yes, I know that sounds impossible. And it probably won't happen. But it would help to build up the energy required to make our way back to the 666 low of March 2009. Risk that pan-Atlantic policy responses crush shorts is high. And btw, we are hitting multi-year extremes in sentiment. Beware.

GG

Tue, 10/04/2011 - 14:23 | Link to Comment tsx500
tsx500's picture

yep, i just posted the same thing (kinda) on another story here @ZH...   either a temp low was put in earlier (sp 1075) or maybe we go just a little below that (either today or next few days) , but i predict a rally very soon to 1250-ish , but  then it's  lights out !

Tue, 10/04/2011 - 13:57 | Link to Comment I am more equal...
I am more equal than others's picture

Peter said 'it's just a weird feeling being part of the consensus.' Being permanently contrary is good?  Sometimes, on those rare day, the majority is correct.  Greek is out.  Italy is in the box and the pitch was high and tight.  Spain is on deck.  The old empires are about to die yet again. 

Tue, 10/04/2011 - 13:57 | Link to Comment Belarus
Belarus's picture

I understand Peter you getting baited into going long--though I haven't. All those short squeeze rallies, aglo lifting miracles makes you think any annoucement at all of a coordinated effort to "save" Greece yet again, any inkling that this economy isn't falling off a cliff, and you could see a huge bounce. Clearly, you reversed your trade for risk management. But I just think all bets are off the table until QE3 is immenent (Bernanke says "there are NO current plans in place for QE3) or not. 

Until then, seriosusly, everything is noise. Even if Greece is "saved," which I using liberally as per putting the word save in quotes, all it will mean is a short term rally in stocks. It will do nothing for our economy here save systemic risk for a little while longer and once our contracting economy comes back into focus any rallies will be short lived.

Just stay patient grasshopper. Don't fight the Fed--LOL.

Tue, 10/04/2011 - 13:59 | Link to Comment Dr. Engali
Dr. Engali's picture

Completely useless post.

Tue, 10/04/2011 - 17:41 | Link to Comment dcb
dcb's picture

no, he was wrong, but it's a good post because he had the courage to make a prediction. most of these people don't

Tue, 10/04/2011 - 13:59 | Link to Comment Waterfallsparkles
Waterfallsparkles's picture

Aapl killing the Market.

Tue, 10/04/2011 - 14:09 | Link to Comment Sambo
Sambo's picture

What happened to Apple? Did somebody find a worm in it?

Tue, 10/04/2011 - 14:15 | Link to Comment r101958
r101958's picture

....with a large portion of their sales in China and overseas......a recession over there does not exactly bode well for them.

Tue, 10/04/2011 - 13:59 | Link to Comment PulauHantu29
PulauHantu29's picture

Ben Beefed up the Markets this morning...lol.

We are now officially in Plunge Mode.

Tue, 10/04/2011 - 14:30 | Link to Comment r101958
r101958's picture

Probably because most have figured out by now that his beef consists of 80% fat and gristle.

Tue, 10/04/2011 - 14:00 | Link to Comment RobotTrader
RobotTrader's picture

Another day where Fiat Paper rules over Hard Assets

Tue, 10/04/2011 - 14:02 | Link to Comment Infinite QE
Infinite QE's picture

Hey Pump-N-Dump boy. How's those lulu, tzoo, etc. garbage longs doing for ya?

Tue, 10/04/2011 - 14:01 | Link to Comment Waterfallsparkles
Waterfallsparkles's picture

Beginning to feel like 2008 all over again.

Tue, 10/04/2011 - 14:04 | Link to Comment mynhair
mynhair's picture

It's another ramp job.  Only cuz I'm back in TZA.

Tue, 10/04/2011 - 14:10 | Link to Comment prophet
prophet's picture

for SPX don't stay too long on the short side - 200 month MA for SPX is very powerful - max time spent below it is about a year and there have been some 10P+ ricochets after touches of the line also consider 200 down to 900 area and 200 up to 1300 as equally likely year end targets

Tue, 10/04/2011 - 14:17 | Link to Comment Sambo
Sambo's picture

Stock markets are rigged. No matter where you place your bets in the short term there is a big chance that you'll lose big. 1300 or 900 with equal probability is like tossing the coin.

But my take is that our fiat dominated world economy is going down and fast. Buffet's WMD is about to go off. So SPX is hitting levels far below 900. That is my opinion. Feel free to disagree.

 

Tue, 10/04/2011 - 14:22 | Link to Comment anony
anony's picture

Consider yourself disagreed.   Like you, the markets are rigged, but my take is that I don't know nothin' about where it's headed.

Tue, 10/04/2011 - 15:09 | Link to Comment clones2
clones2's picture

2 major Fibonacci retracement levels from the 2009 lows to the 2011 highs.

38% retracement - 1100 = the exact level we bounced on the first major pullback 2 months ago....

50% retracement - 1015 = the exact level of the 2010 lows...

That could very well give you some idea...

Tue, 10/04/2011 - 14:10 | Link to Comment Dick Darlington
Dick Darlington's picture

Apparently Greece just went long on tanks for their army. I'm sure the european tax payers are VERY delighted to hear where their hard earned tax euros are going...

http://www.defencegreece.com/index.php/2011/10/the-u-s-approved-to-grant...

Tue, 10/04/2011 - 14:12 | Link to Comment warchopper
warchopper's picture

So...anyone going to buy-on-close.

Tue, 10/04/2011 - 14:20 | Link to Comment anony
anony's picture

Yup.  Buying TZA with both fists.  This is the time of the  Hunter-gatherer.

Tue, 10/04/2011 - 14:13 | Link to Comment Cone of Uncertainty
Cone of Uncertainty's picture

Shit bitch, wait for 3:45pm when we replay yesterday's bid-less market action in financials and every other dog shit company that deserves to be fucking sold into complete and utter oblivion.

 

Tue, 10/04/2011 - 14:19 | Link to Comment anony
anony's picture

So you wouldn't buy CMG 500 January 13 calls, is that what you're telling us?

Tue, 10/04/2011 - 15:22 | Link to Comment Cone of Uncertainty
Cone of Uncertainty's picture

Ariba!!

Tue, 10/04/2011 - 14:17 | Link to Comment virgilcaine
virgilcaine's picture

The Vix needs to get going.. get going vixie,  Needs to be Up on this Down day in Stocks.

Tue, 10/04/2011 - 14:20 | Link to Comment virgilcaine
virgilcaine's picture

Either major selloff this afternoon or reversal!

Tue, 10/04/2011 - 14:21 | Link to Comment wiscofund
wiscofund's picture

First post on here...hello ZH world

Tue, 10/04/2011 - 14:48 | Link to Comment vincent
vincent's picture

Anonymous attacking NYSE is apparently a misinformation ploy to discredit movement

http://pastebin.com/MCT1L3Kf

Tue, 10/04/2011 - 14:33 | Link to Comment alien-IQ
alien-IQ's picture

the volume on the MS Oct 5 puts sure looks like some people are looking for this thing to go a lot lower.

Or maybe it's just somebody playing one BIG ASS LOTTO TICKET.

Tue, 10/04/2011 - 14:34 | Link to Comment HANKREARDON
HANKREARDON's picture

Peter, if I read your opinion correctly, you rode the mkt down to here and now you are shorting? Genius.

Tue, 10/04/2011 - 14:38 | Link to Comment ivars
ivars's picture

Most likely only by the end of October DJIA will be stable under 10000. It is not a collapse that is happening today, just the unwinding of effects of QE2. Predictable since beginning of QE2:

http://saposjoint.net/Forum/viewtopic.php?f=14&t=2626&start=0#p30485

The mistake in this February 6th chart today is 0%. Its spot on within the thicknes of the line I used to draw it.

However, long term picture with deflationary recession in the USA does not look good for DJIA stocks nor recession:

http://saposjoint.net/Forum/viewtopic.php?f=14&t=2626&st=0&sk=t&sd=a&sta...

So its deflationary recession  till end of 2014 ( I have longer term predictions, just finetuning them, up to 2015).

After that , in 2015 the USA default on debt, and inflation. That might help to go out of recession, might cause ( even before the default) some wars.

The interesting thing now for me is to predict how much and when vs, what currencies USD will appreciate, meaning that those currencies will buy less and less oil. Will they tolerate it or try to increase the values of  their currencies somehow (e.g. China moving to silver standard?)

More on currency rate forecats  later. Clearly , USD will appreciate almost against every currency in 2012-2014, being a reserve currency and mother of the USA debt that pays for everything.  It has already started.

Tue, 10/04/2011 - 14:50 | Link to Comment jmcadg
jmcadg's picture


Sorry

This market may not be sold to open due to stock borrowing restrictions in the underlying market. Please call in if you require an explanation.

Tried to short Morgan Stanley!

Tue, 10/04/2011 - 15:32 | Link to Comment youngandhealthy
youngandhealthy's picture

Peter says it all....

 

"...It would also appease a lot of Americans if some other country was feeling pressure on its ratings due to politics....."

 

 

Tue, 10/04/2011 - 15:53 | Link to Comment Randall Cabot
Randall Cabot's picture

So much for this thread...

Tue, 10/04/2011 - 16:04 | Link to Comment Zonker
Zonker's picture

LMFAO - you Moron!

Tue, 10/04/2011 - 16:11 | Link to Comment Randall Cabot
Randall Cabot's picture

REVERSE INDICATOR:  Peter Tchir

Tue, 10/04/2011 - 16:14 | Link to Comment Joe Shmoe
Joe Shmoe's picture

So much for those longs... eh?  

Tue, 10/04/2011 - 17:22 | Link to Comment totem
totem's picture

So the big question is: did Peter switch back to long before EOD?

He was just a little early on his call.  This market felt like a spring that was wound too tight... either a bank or sovereign had to fail fast or it was gonna bounce.

I started flipping to long 20 minutes to close.

I'm thinking that releasing that FT story will soften the Moody's downgrade blow ... people will ignore bad news for a day or two now, right?

Eh, we'll see!

Tue, 10/04/2011 - 21:42 | Link to Comment rhinotrader
rhinotrader's picture

How is your ass Peter?

Do NOT follow this link or you will be banned from the site!