It’s increasingly clear, isn’t it, that our supposed leaders in DC are incompetent, craven, and compromised. The debt deal, which they did with as much drama and little intelligence as possible, is just more evasion and kicking the can down the road. But no one is buying their pretend and extend game any more. In a time when we need real and actual leaders, instead we have pathetic poodles. We need a change. Now.
Italy is imploding too, with apparent runs on their banks. This after Berlusconi was able to tear himself away from teenage hookers long enough to tell the nation everything was fine, just fine. No one believes or trusts him either. (That last link is from Zero Hedge, which has melted down under the onslaught of today’s trading. So, the link may be dead for a bit. Their RSS feed works though)
The widely watched S&P 500 index not only failed to hold the 900 level yesterday, it also closed below its 50 and 200 moving averages, a highly bearish signal. The Dow and Nasdaq also got whacked.
Trader Mike reads the tea leaves. I once asked a friend who has traded futures successfully if technical analysis worked. He thought it did, then said besides, it can be a self-fulfilling prophecy. If everyone thinks it’s bearish when an index breaks its 200 ma, then they start selling, and that drives the index down even more.
The party on Wall Street appears to be over. It never did have much relationship to reality anyway.
Final-hour surges and air pockets, common lately, unnerve the methodical investor.
The apparent gaming of newly popular leveraged exchange-traded funds late in the day is another wrinkle… These funds always need to trade in the same direction of that day’s move. Knowing this, traders attempt to quantify and front-run this action.
The market feels uneasy to many because the market currently appears rigged and manipulated. So why bother?
Yet, they indisputably are. According to a study prepared for Bloomberg by Washington Service, a research outfit, directors, officers and the like have sold $353 million worth of stock in this fading month, or 8.3 times the total bought.
It all boils down to this: Nobody ever sold a stock because they thought it would go up. And as a group, corporate insiders obviously are scarcely enthusiastic about the prospects for a genuine bull market.
Insiders are the top management and major shareholders of a publicly-traded company.