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Friday, November 22, 2013

12 Thoughts on Bigger Picture

The guy asked this: http://evilspeculator.com/?p=39382
...you repeatedly carry the banner saying we're all screwed....  there are some good minds here & I'd like to see a little discussion on the matter sporadically about long term methods to prepare...

This is a bait I can't refuse...lol
Here are some thoughts generally, and also about finances and investments.

Saturday, November 16, 2013


Holly Shit !  1800!
This thing is going parabolic, full retard to upside.


I've been looking at this Weekly Nasdaq A/D line for months. Its kinda different from other internal indicators, because it shows a cash build-up phase for all of 2011-2012, with low on Nov 12, 2012 and high on Feb 14, 2011. Projected peak end of July 2014. Reliability of this analysis is questionable, T-Theory had alot of misses lately, it may be unsuitable for run-away bull market conditions.

Of note (and may-be more actionable) is a negative divergence in oscillators between July and October peaks of A/D line. Daily version of  Nas A/D Cumulative plot also shows this divergence.
It's been my (non-scientific...lol) observation - this rally sucks.
Nasdaq A/D T 11/2012




Update 11/26/2013
Just to illustrate how illiquid this market has become, here is a 5 minute chart of E-mini S&P contract ESZ13. Overnight markets are notoriously illiquid, as seen 10pm to 2am. Surprisingly similar price action clearly visible during previous day session - between 10am and 2pm, and especially so around  after 12pm and again around 1pm.

And again, even worse, on 12/10/2013

I have another personal observation. I've been watching ES streaming live chart for years. Its a lively, active contract, and machines loved it. You can still see them working at open and close, when candle starts jumping at incredible rate, bid/ask size fluctuates greatly, and trades come in 1000's of contracts. Other than that, I have not seen bot activity in Months!

 I am sure they are still there, executing strategies for arbitrage and working large orders in a way that it doesn't move markets much. I just don't see them the way I used to. Did machines walked away, or did they kill each other off, or may be they just waiting for command? That I don't know. For better or worse, the nature of this market has changed. I don't know what it means to me and my own Systems. That's all.

Tuesday, November 12, 2013

Spring to Action

Spring of 2014.
New action plan calls for a major change less than half a year from now.

This day-time job of mine is killing me. Makes me afraid of change, unable to act, old. Sometime during this past year I started feeling stuck, drowning in endless routine, scared of the world and very pessimistic. This must change, otherwise nothing better will ever happen.

The side-gig has been a great financial help this year. So much so, it almost doubled my income. If it will continue next year, I will be able to make ends meet during the busy season April thru October. This is my window of opportunity. Although it remains to be seen, I am fairly confident that jobs will come thru. I should know more sometime in February. Then I can give a generous notice at work, train a replacement, maybe stay part time for few weeks. I want to leave on a high note, just like I did in a past.

Timely quote I found on http://blog.stocktradersalmanac.com/ (Thanks Jeff)
"Self-discipline is a form of freedom. Freedom from laziness and lethargy, freedom from expectations and demands of others, freedom from weakness and fear, and doubt."
—Harvey A. Dorfman (Sports psychologist, The Mental ABC's of Pitching, b. 1935)
 I am going to need that 'self-discipline'. The time freed-up from dead end day-time job will have to be used productively. 

UPDATE 1/19/2014
Time flies. Over past two months I was able to formulate a pretty good game plan and set things into motion.
I gave notice at work last week. Surprisingly, my bosses seems a little panicked, but didn't offer me pay-raise as an incentive to stay. Guess I am not as valuable, as I thought... he-he. They promised to find a replacement by mid-February. I figure it will take a month or two to train, so I am looking at April. Freedom is so close, I can almost taste it.

But first things first. As one of my favorite 'Characters', Captain Vrungel pointed out: "How you name a boat, is how it will sail." So here it is:
Bergamot Capital Management
I like it!

The mission of BCM is to create and manage a life-changing generational wealth.
Nothing less will do.
There is an important condition, that may be an impediment to fast success. No partners, no outside investors. I put in all the labor, I will reap all rewards. May take me a bit longer, but 'overnight success' always requires years of hard work anyway. I experienced that before, at the height of  MSPV, it was very rewarding both financially and emotionally.

I don't want to dwell upon rise and fall of MSPV. I am at fault as much as my partner, who neglected his duties for years, leaving me with abnormal share of work, yet collecting equal compensation. It was I, who failed to recognize importance of  technological changes in early 2000's. Social and economic changes that followed kinda destroyed that industry anyway. In hindsight, I could have done something about it..., but I didn't. MSPV closed its doors almost 5 years ago, to my credit it was a graceful exit. No bankruptcy, no debt, no stiffed creditors. I did waited until "fat lady sings", so I have nothing to show for a 20+ years career.

Two recent experiences with 'investors' made me change my mind about outside money. Especially liquidation of Flagship account in October 2012, which was a very dramatic experience. It took me months to recover psychologically. I don't really care that the guy lost money, as it was entirely his doing. He decided to pull money during less than 15% drawdown, and as I later find out - he didn't really even needed that money, just didn't want to 'play' any more. Obviously, I can't tell what would happen to that account otherwise. But here is what happened to LB account (which I traded almost in parallel to Flagship) - by beginning of 2013 it not only recovered all losses, but was already in profit. LB became my main account and been pushing new equity highs ever since.
Muppets always manage to shoot themselves in a foot.
I don't want any part of it.
And that's that.



Top shippers:

Wednesday, November 6, 2013

Twiter IPO

Finally, this day has come!
Actually its getting 'priced' today, but will start trading tomorrow.


IPO market is super hot. Companies coming in droves, with no revenues or profits, and surely double on a day of IPO. If I was ever looking for an event that could mark the top of this bull market... TWTR would do. What top? This is the 4th biggest bull market in modern history. Tulips, yep

Since before Gov shutdown, I am having a hard time catching any data releases. There is very little discussion on Bloomberg and NPR. Admittedly, I watch even less news than before, but not completely cut out, so something should have gotten to me. OTOH, ZH featuring articles about major misses and deterioration of all kinds of economic data, or at-least parts of it.

btw, I am reading ZeroHedge on purpose. There is no other website I know of, that offers real important news fast, plus analysis of economy and financial markets in real time. The only drawback is that Tyler offers it with a bit more hysteria than I would prefer, and with definite perma-bear bias that I share at this time (never mind that more than half of my portfolio is long at this time).

From ZH: here are dates of tops and bottoms of all bull and bear markets from 1929
Field of research is narrowing. Air is really thin up here
this the fourth biggest bull market in US history

There is going to be a 'scheduled' electric grid shut-down on November 13-14 to test US/Canada electric grid. info is very scarce, mostly rumors.
11-13-13 Another date too easy to remember (like 9/11, 7/7 etc)?
Also it seems too easy to make parallels to other false-flag events of recent past and how gov ... and bla-bla-bla
I asked an opinion of RedDragonLeo - a major doomsday expert, numerologist, Legatus watcher etc. Guy is very skilled and called in advance every major top over past couple of years, except none of that ever worked. So much so, he had to resort to penny stock pushing/pumping... very sad.
Red replied here: http://reddragonleo.com/2013/09/28/the-stage-is-being-set-for-a-possible-3000-point-drop-in-the-dow/#disqus_thread  
Here is an excerpt:
"I heard about that electric grid shutdown too but so far ever last thing predicted since about 2009 forward never happened. We all got scared with Planet Nibriu, Mayan Prophecy of "the end" in 2012, and dozens of other scary forecasts... but none of them happened.  I don't think this one will either...
 ...While a pullback is still likely to happen I'm starting to think that they are going to rally this up much higher then we believe possible next year, and maybe the year after that too? While you can't trade off what Lindsey Williams says I do believe his statement that the elite aren't done creating enough debt yet...
... The next meeting is Feb 6th-8th, 2014 but until we top 2000 SPX I wouldn't even think for a minute that the "real crash" is coming...."

 Like I said, Bears are Extinct.


I don't think i mentioned it before in this journal, but there seems to be an almost a determined effort to destroy financial industry. Knight, PFG, MF Global, SAC etc are gone; and numerous cut backs of trading desks across financial instruments. Not to mention S&P Chicago pit, now almost deserted.

Banks aren't helping themselves either, as widespread market manipulation scandals come to light.
Here is Matt Taibbi of Rolling Stones:
 "The only problem is that the scale of the misdeeds in these various markets is so enormous that even the most half-assed attempt at regulation will cause a million-car pileup...If they're guilty, they're done."


This is how this shit really works these days. The real pro's of Wall Street, the modern day market makers, 'specialists' - algorithm builders. Complex system of markets is more complex than ever.



ECRI's Lakshman Achuthan on Bloomberg
"we believe a US recession began in 2012"