Quick Update

So the lack of buying pressure i mentioned 2 weeks ago in GS was true. The big boys were staying away from buying the brokers because of concerns regarding their liquidity. A week after i said right here that GS lacked institutional buying support and i was going to bail out of my long position for a small loss (5% i think), Bear Sterns (BSC) announced a liquidity problem. The big boys (hedgies, mutual funds, etc) who execute margin trades with the desks at these brokers probably figured something was amis and stayed away. Friday turned out to be BSC's worst nightmare with 50% of the market cap being shaved right off the stock price. The news that JP morgan and the Fed might inject capital into BSC to alleviate the liquidity concerns did more harm that actually ease investor concerns. The main reason for this, i believe is, that investors are now starting to rethink how bad the subprime problem is, if Bear needs emergency liquidity injection. Ofcourse, these concerns spread across the other brokers (LEH,GS, MER, etc) and took them down too.

Also, the market has been very frustrating to trade lately. Earlier in the week we had the 415 Dow rally which automatically triggered my stop loss points for FSLR and MON and got me out. I usually use traling stop losses for exactly these types of instances where i can protect atleast some of my profits in a reverse move. I tooks off 75% of my DUG position too yesterday at a stop-limit order price of 39.7. My average price for the DUG position was 36.5.

Evene though i have barely made 2-3 trades in the last 2 weeks, just watching the market action is frustating me and i can imagine what its doing to people actually trading it. There just seems to be no follow through in either direction (>2-3 days) and i doubt anyone is really making any decent money in this market except intraday traders. If you are feeling just as frustrated with this market as i am, i think your best bet is to step back and do nothing until things calm down a little.