Kudos to MMs

[nitro]

"Boehner: Bernanke's Fed to Blame for Sell-Off"

http://www.cnbc.com/id/100831352

What an idiot. Where were these guys when the market came off 677 and nearly trippled? Whose "fault" was that?

 

[nitro]

1572 support, but should skew it higher to about 1576. If 1572 goes, 1550 and 1542 come pronto, imo.

 

[nitro]

Quote from nitro:

Fall 50 handles in one day, then correct 10% over the next month or so. How it does that I don't know. [up down down up up, or up up down down down down etc]

Was off by a while.

 

[nitro]

Holding 2 units short from 1642 and 2 units short, 1@1572 and 1@1567.

 

[Nine_Ender]

Quote from nitro:

The reality is that markets trade often 1 to 1.5 standard deviation from where they should. That equates to about $1 to $1.5 Trillion dollars. So if your FV models says 1542, add 1.5 standard deviation and keep size small and hit hard at 1.5 stddev from FV. Size should go up at 3 std, and it should be max size at > 5 stddev. Crashes can wipe you out on the downside [the crash of 1987 was a 20 stdev event!!! The Flash Crash was a 10 stddev event] so have to skew downside risk.

That is the lesson I have learned over 30 years. Trade small size all you want, wait to hit hard or accumulate a decent position only at substantial stddev from FV.

So many people make calls. The calls should be stated in relation to the position size they are taking. That tells you their actual conviction. People tend to size based on volatility but that is only half the right equation imo.

All sounds good except for the fact you repeatably break one of the golden rules of trading, adding to your losers. So everyone could see when the bull market picked up steam you leaned far too heavily on your "models" that mispriced SPX valuations immensely, and when the market said you were wrong you refused to accept what the market was telling you.

 

[nitro]

1572 to 1575 ish is now imminent.

 

[dont]

Oh God you back what using those Clifford algebras to calibrate now😱

 

[nitro]

Bond Losses of $1 Trillion if Yields Spike, BIS Says

http://www.cnbc.com/id/100836919

It's a mess. Everyone says the US [FED] did the right thing by interfering and Europe did not by not interfering. I wonder what history will say.

 

[nitro]

[pre]Market at short term support. Next target 1542.

 

[nitro]

The question now is where it finds its resting place. History and statistics say most of these pullbacks are 8-15%, so 1480 is a very strong possibility.

However, we know that markets regularly trade 1 to 1.5 standard deviation from FV. So if FV is say 1500 (a guess) the market at current VIX can easily trade anywhere between 1350 and 1650. A HUGE range.