Frank Palmieri's Daily Ramblings

Finally got a co-op job! To top it off, it was by far the best position and company I applied for. It fit perfectly with what I'm looking to do in the future. It really is amazing when you have an interview and get a call back in the same day.

Just wanted to show you one chart from today - /ES - I am fully short this. The breaking of 820 today signals to me that we're going lower. At least to 800, which is our next psychological support. And I think you should see it.

FAZ also shot up at the end of the day today. The final move is starting and I'm on the right side of it.

No position changes from the last post.

Jeez, so I haven't posted here in a while. Been busy on the job hunt and with school. I am now writing at Above Average America which is a site where I'll be posting my t/a, but mostly more econ related articles and such.

BTW: Note to self - Listen when you speak, because you might say something important. Like being short term bullish. I should have heeded my own advice. I was stupid, stayed short, and got bit in the ass for it. I'm down a hell of a lot in my paper trades, but such is life. You win some, you loose some, and I lost big time. Next time I'll go with the charts.

Anyway -
Right now I'm still short. The gap up on FAZ today is basically confirming my suspicions. No one actually thought the banks were doing well. And people still think Geithner's plan is a pile of crap. The suspension of M2M might turn out to be inconsequential, but I think it has other ramifications outside of the technical aspect with regards to the psyche of wall street.

Either way, I have a near term target of 750 on the SPX, which is going to have to bounce up slightly in a rally, and then I think we'll see the final drop I've been expecting. It isn't over till the fat lady sings, and she has to sing damn loud.

No charts for today, but my current positions are as follows -
Long FAZ
Short /ES
Short GHL
Short ARNA

Long RHT

Another aside here, if I might - Red hat (who my brother works for, full disclosure) is doing extremely well despite the economy. I'm up roughly 9% already and I am holding for a long-term trade. I really like the company, and I think they have plenty of growth potential. Whether or not they live up to the hype is up to my brother and his colleagues. Either way, I think they're good for 20-25 at least, so I'm a buyer until I see a reversal, and even then I'll probably just keep holding.

I believe this will be the move downward that we've been waiting for. The final high volatility, *capitulation* as Atilla Demiray on xtrends calls it.

For it I've loaded up on puts, Calls on the inverse ETFs, a few straddles, and some straight up shorts on the asset.

VIX bounced directly off the bottom of its channel and is heading on its way up. We're going to need to see a spike just like the november lows before I'll be convinced.

Everyone should watch these videos - Ben Bernanke on CBS' 60 Minutes (Part 1&2)

: - O!!

The new E-coupe is too sexy... Must have...now...

Well, that or a C6 Vette w/ a Manual Transmission.

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Interviewing with IPS Worldwide on thursday, March 17th. Really excited. They're a 3PL based out of Ft. Meyers Florida. It's not a finance position, but I really do enjoy supply chain mgmt so I'm still happy to have the chance to interview. I think I'd take the job if I was offered one.

Need to study excel summore...and study for my classes a little more too.

CNBC has become a cesspool for self-proclaimed MOTU's to bicker endlessly. Maybe it's always been that way, but the economic downturn has brought out the worst in these people.

We have people espousing the treasury view, that idiot Rick Santelli screaming about helping your fellow man, and a whole host of other ridiculous ideas that only idiots jaded by their socio-economic status could come up with.

People say we should stop demonizing the rich, but they make it awful hard not to.

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BTW: Is the bounce coming? I hope so. I'm buying into this one (BGU). So far I'm up around 62% in just over a month, which means I've netted about 40% so far.

Watching Jim Cramer is like pulling teeth... I can't stand it...I just don't understand why anyone would listen to him.

Anyway, I digress...

I've switched to the S&P500 as my primary index indicator. The DJI doesn't have any real support levels in the 6k level. Either way, I'm short term bullish (<1 week) as the price seems to have hit the bottom of the channel. Today there was fairly heavy volume we didn't have much of a move. We event had a bit of a bullish rally mid-way through the day. The bulls are starting to push back.

When comparing SPX to VIX, one can see the reduction in volatility. It seems as if the bottoming process is finally starting. We're seeing a reduction in volatility, and prices are at 12 year historical lows. The bad news seems to have been priced into the market.

Interestingly enough, based on fundementals, Econbrowser had a post recently showing that stock prices are right around their fundemental levels right now.

So, short term, I'm a buyer, medium term, I believe this is a trading range market, and long term, I'm still very bullish. It's going to take many years to get back to where we were previously, but this is a great buying market right now.

Options pricing and black-scholes book came in. It's not as good as I thought it would be. The format is meh, and it's almost overly basic. Pretty much exactly what I'm learning in my corporate finance class as far as volatility and std. deviation goes. I'll keep reading through it though. Still waiting on the Excel book.

Anyway I'd really like to take a minute to talk about fiscal stimulus...

It seems evident to me that republicans have dove off the deep end. And Paul Krugman agrees in his Blog post - The Crazy 36.

It's a shame really, that the party lines are being towed, and even State Governors are following suit by rejecting funds. It's political grandstanding, considering it would only be a 20% increase in funds already provided by the government. But I suppose being politically savvy means doing things at the expense of your constituency in order to take some sort of "moral high ground."

Brad DeLong makes a compelling argument and reasoning for why fiscal stimulus will work. I highly recommend reading his and Paul Krugman's blog, as well as Matthew Yglesias, and Econbrowser.

That's all for today.

So the dow rebounded late in the day around 2:43, was up about 1%, and then ended down 80 pts at 7270.89. This essentially confirms the pennant I drew earlier. I think I'm going to position myself according, long BGZ, and long FAZ. The 3x large cap and 3x Financials.

Ended the day up a total of 50%.

Waiting for my two books from Barnes & Noble. Should be here tomorrow -
Microsoft Excel Data Analysis and Business Modeling
and
Option Pricing: Black-Scholes Made Easy

Going to teach myself Excel, as well as options trading. I figure it can't hurt to know this stuff when I interview with PAR Capital, if I get an interview at all.

Well, it's pretty much a given now. Dow 6000 is in our sights and it's not letting go. One can see the bearish pennant forming...

For now I'm staying short with BGZ, a 3x ETF, for the Stock market competition. Up 43% give or take .5 right now.

My personal opinion - We're going to see 6000, and we'll linger in the 6000 range for a while, maybe a few weeks, then the rest of the year is going to be trading in the 7000's. We'll see if I'm right. Best case scenario is 9000, worst is 5000. I don't think we'll see lower than 6000 though. At least...I hope not...

Yup... finally decided to start a blog. I'll be posting here periodically, voicing my views, doing whatever.

Hopefully I'll get some technical analysis up here, some new photography etc... This will be interesting.