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Wednesday, August 26, 2009

08/26/2009 Pre-Market Briefing

Finally, a gap down open would be. A tiny little bit gap down within a recent trading range means it will be filled and the day tends to be flat.

A mail from uempel as some of you know that I respect his opinion. Well again, like all the posts here in this blog, it’s just an opinion I’d like to share (which makes me very happy), but it desn’t mean I agree or disagree.

I believe that one of the most important keys to success is an abundance of patience. Sometimes the charts are contradictory and then it might be just that – to be in cash and to wait for a new short- or long-term trend to establish itself.

I can tell you the story of an American guy I knew who sold all his NASDAQ positions in 1999 and waited 8 months before he went short in March and April 2000. But he’s a well-read savvy investor. He was about 65 years old at the time and he knew he could easily make a few hundred percent by shorting the NASDAQ – and he had the necessary patience to wait for the right moment. His moment to pounce was the drying up of all the liquidity Greenspan had put into the markets (in order to avoid the markets from faltering because of computer glitches at the transition 1999/2000). When the Fed started to close the liquidity taps in January/Februar 2000 the guy knew it was time to act.

Well, this guy prepared his moves very, very carefully. I did not quite understand him at the time. But in the end his handling of the situation was absolutely superb. His trading also impressed other people, and some hedge fund wanted him as an advisor, but I think he was not interested. I have lost track of him now, because a mutual friend is no longer in business and lives elsewhere.

Bottom line: I guess the key to making money on the stock-market is to know when to be out of the market. You might miss a move of 10% or even 20%, but you can be pretty sure to catch the next move...


  1. The Big money is made by the sittin' and waitin'-- not the thinking". Jesse Livermore.

  2. You should take some time and read some of the Taleb books Black Swan and Fooled by randomness. You could also take some time and take a statistics class.

  3. Hi

    It's time to short now or no ?

  4. I appreciate your hard work on this excellent blog.

  5. This comment has been removed by a blog administrator.

  6. Thanks for posting the email from Uempel,...I hope he is doing well, and look forward to his return. His posts here in your comment section were always very worthwhile. Regards, Jim P.

  7. Anony at 2:38pm, maybe because of different culture so actually you mean that but I think I better remove this. Thanks for understanding.

  8. It's 2:50 pm,..lots of PUTS being bought today,..
    lots of predictions of imminent top, etc. Maybe an UP day on Thurs? Regards, Jim P.

  9. CPCI = 2.33, well, could be an up day tomorrow.

  10. Love your blog...Nice call on flat day Cobra.

  11. Cobra,

    Your Blog is really helping for a beginner trader like me. Thank you very much for your good work.

  12. Thanks for your work Cobra! I thoroughly enjoy it. Also, thanks for starting to whip out the banhammer on douchebag trolls.

    How much of a gap down or up on open of the s&p would be required for you to conclude the continuation or reversal had likely resumed/begun?

  13. Cobra,

    Just want to let you know that your blog is one of the best ones( free or not) out there. I have been reading for the past four months and I saw your missed prediction, but, honestly, who would it be 100% right and free simultaneously. Anyway, I see that everyday you are getting more and more "annony" critics and I do not understand why are they so aggressive. You do not ask them to make any moves, you are just posting your believes, FOR FREE!!!. And as you said, 70% of the time you are right. Please keep up the good work, and in a market like this every one could be right and/or wrong in the same day. Thanks a million

  14. AK, close above/below the current range will convince me that the trend resumes/reverses.

    JBR, thanks! I've sacrificed a lot for nothing, just cannot understand why people are so harsh.



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